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- Sales in 2002 were €128.8m, including €3.3m from the former CGI Japan acquired in April 2002.
- Q4 sales were €35.1m, an increase of 14% on the same period in 2001, despite the fact that sales in Q4 2001 were exceptionally high due to nonrecurrent revenues. Adverse exchange rate movements reduced the rate of growth in the quarter by around 2 percentage points. Against a background of market conditions, which led brokers to exercise considerable caution in making investment decisions - particularly in the second half of the year, GL TRADE was able to draw strength from the market positioning of its products and a business model based largely on recurrent revenues:
- GL TRADE's product range remains highly competitive against internal projects by banks and the products of rival providers;
- GL TRADE continues to benefit from the growing use of electronic trading platforms on financial markets, particularly in Asia, and the growing success of standardised solutions at the expense of in-house development;
- GL TRADE continuously adapts to a changing market - offering clients innovative solutions which reduce costs or allow the expansion of new business areas that offset declining profitability in traditional ones, eg: addedvalue view-only products like GL WINSIGHT, Order Management Systems and STP (Straight Through Processing) suites.
GL TRADE continued its international expansion: sales generated outside France accounted for 67% of the 2002 total, against 60% in 2001 and 52% in 2000.
Asia, where GL TRADE's position was strengthened by the acquisition of CGI in Japan, now accounts for 8% of total sales, with the US and Canada accounting for 10%.
This increased international coverage has increased GL TRADE's exposure to currency fluctuations, with 42% of sales coming from subsidiaries outside the euro zone (57% of this in sterling, 22% in US dollars and 19% from Asia ). Exchange rate movements between 2001 and 2002 reduced GL TRADE's sales by €1.5m, cutting 1.4 points off the growth rate. As there was an equivalent effect on costs, the impact on margin levels was limited.
Sales by product line
Over the year, growth was fairly evenly spread over the product lines, with the exception of on-line and view-only solutions, which were hardest hit by weak market conditions and saw only limited growth.
The STP range integrates the Order Management Systems based on Finsoft products, for which five sales had been made by the end of 2002. Although sales in 2002 remained marginal, this was a highly encouraging performance in a poor economic climate which did little to encourage clients to make this type of long-term investment.
Outlook
- The early part of 2003 will show a clearer picture of the impact of the current economic conditions on brokers' budgets worldwide. It seems unlikely, given the number of cancellations / activity closures to date, that the impact will be greater for GL TRADE than for 2002.
- Against this background, GL TRADE will focus its marketing on solutions offering clients a rapid ROI, either in terms of increased business levels (GL Net linked to new market access) or improved productivity and lower costs (STP, GL WINSIGHT). To this end, the STP range will be strengthened from March by the launch of an entry-level service bureau solution (ASP model) for order intake. Lastly, a Matching Engine solution, offering brokers full functionality for real time off-market order matching, will be launched with a pilot client in April.
- Looking beyond these projects, GL TRADE is actively building partnerships with various niche solution providers in complementary business areas seeking to benefit from the leverage that GL TRADE's global network can offer them. 2003 will be a year of partnership agreements and acquisitions which allow us to strengthen our strategy in a significant way.
- GL TRADE forecasts growth of around 15% in 2003, at constant exchange rates, with a net margin (before amortisation of goodwill) of around 13 %.
