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Autonomy Corp posts record revenues in 2009, confident about 2010 outlook

Infrastructure software developer Autonomy Corporation (LSE: AU) reported a strong set of full year results, achieving a 47% increase in revenues to a record breaking US$740 million, while pre-tax profits jumped 55% to US$323 million, which was in line with expectations.

The company said that the growth was despite a tough economic environment and “an unhelpful FX (foreign exchange) headwind,” whilst most of its software peers saw small or negative growth.

The full year performance was helped by a strong Q4, when the company announced a string of new clients:  American Airlines, Amgen, AT&T, BAE Systems, Boeing, Charles Schwab, Citi, Ericsson, KPMG, McAfee, Merck, Peugeot Citroen, Qatar Airways, Santander, Whirlpool and Wolters Kluwer, as well as new and repeat licenses with multiple government, defence and intelligence agencies around the globe including in the US, the UK, NATO, Australia, Brazil, the Netherlands, Romania and Sweden.

The total number of OEM (original equipment manufacturer) agreements for 2009 amounted to 47.

The organic growth for the quarter and for the year amounted to 18% and 16% respectively, while quarterly revenues rose 53% year-on-year to US$223.1 million and pre-tax profits improved 51% to US$111 million.

The company said it has also prepared for a possible upturn in 2010 by developing its IDOL (Intelligent Data Operating Layer) software and expanding its hosted capabilities, after which Autonomy’s cost base returned to its traditional model with an operating margin of 50% in Q4. Autonomy now expects to see growth the Meaning Based Marketing applications of its technology alongside its resilient information governance applications.

“We continue to see our strongest growth in the new models of the software industry such as OEM and cloud computing.  Whilst it may still take a little time for people to understand how these models differ from traditional software businesses, we believe the momentum in these areas is accelerating,” said group chief executive Mike Lynch.

The company added that it saw indicators of an initial improvement in the macro environment, giving it confidence for 2010.

Disclosure: The author holds no positions in the company