Autonomy stock soars after record sales and profits

SOFTWARE specialist Autonomy’s shares gained more than six per cent to close at 1,590p yesterday after it reported record profits and revenues for 2010.

Double-digit sales rises for its key servers and cloud computing systems generated an 18 per cent growth in revenue to $870m (£547m), from $740m in 2009.

Full-year pre-tax profits of $379m were 17 per cent higher than the $323m recorded in 2009.

The results beat analysts’ forecasts after brokers downgraded their profit expectations from 21 per cent to 17 per cent last year in anticipation of poor fourth-quarter trading.

“There were a number of analysts who expected a profit warning prior to the results coming out so the headline numbers are reassuring,” said Singer Capital analyst Tintin Stormont.

Earnings per share rose 24 per cent on 2009’s level to $1.20, helped by a lower tax rate, while net cash generation also rose to $363m from $287m in 2009.

Autonomy chief executive Mike Lynch said 2010 was “a year of transition for us,” as customers moved to cloud computing systems faster than expected.

He also marked an end to the deferrals and delays in customer orders that caused it to issue a profit warning last October.

“In the third quarter of 2010, we also saw volatility in customer assessment of the macro environment, which now seems to have reduced,” he said.