Datalex revenues up amidst return to profit

26 Aug 2004

Irish travel software company Datalex has reported a return to profitability for the first half of 2004, turning in a small profit of US$81,000 compared with losses of US$4.4m during the same period last year. The company warned of slow revenue growth in the second half of this year due to lengthy contract negotiations and sales lead times.

Revenues increased by 6pc to US$15.5m from US$14.6m in the first half of 2003. This reflected income from continuing contracts as well as new product wins with Malaysia Airlines and American Express UK.

The e-Business component of revenue (US$11.7m) increased by 8pc on the same period last year, while consulting revenues (US$3.8m) showed zero growth.

Datalex said that the travel software industry continues to suffer from long lead times between contract negotiations and revenue generation. The company warned that this situation and anticipated lower consulting revenues is likely to hold back revenue growth for the second half of 2004.

Despite the difficulties of previous years and its success in stemming losses, the company still has a significant war chest of US$35m in the bank.

By John Kennedy