GFT: Deferrals At Largest Investment Bank Customers
Edison | Jul 12, 2017 01:33AM ET
GFT Technologies AG (DE:GFTG) has lowered its FY17 guidance due to delayed decision making at its two largest investment banking customers – Deutsche Bank (DE:DBKGn) (DB) and Barclays (LON:BARC). GFT said that management changes at the banks have resulted in deferred orders. However, investment banking revenue outside these two customers has been guided upwards, as has the group’s retail banking segment. But these factors were outweighed by the revenue declines at the two investment banks, and management has cut its FY17 revenue guidance by 6% to €425m, while EBITDA comes back by 13% to €42m.
In order to explain the downgrades, GFT provided a table of revenues by client groups. This shows investment banking revenues from Barclays and DB coming back by 23% from the previous guidance to €126m while their retail banking revenues increase by 11% to €69m. The cuts in investment banking are mainly due to deferrals in regulatory projects. DB is expected to produce 39-40% of GFT’s FY17 revenues, down from 44-45% in FY18, while Barclays’ share is expected to fall to 4-5%, down from 7-8%. This is the first time that the two largest accounts have been cut back significantly simultaneously at GFT. Nevertheless, management believes its guidance is now conservative.
To read the entire report Please click on the pdf File Below:
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.