Fundtech Ltd. is ready to declare the financial crisis over, as it reported third-quarter results Monday that exceeded expectations.
"We started to see improvement in market conditions as we started to receive large orders from our high-end customers," said Reuven Ben-Menachem, the payments technology vendor's chairman and chief executive, on a conference call with analysts. "The one market segment that has yet to show meaningful recovery signs is the small- to medium-sized banks in the U.S., which represent less than 30% of our business."
Banks are picking up projects they had previously shelved, he said. "The deals that we did with our existing banks were deals that were on hold due to the crisis. And as banks started to feel the recovery, these orders were given to us."
He said a deal with Bank of America Corp., announced in September, to use Fundtech's technology in the Charlotte company's development of a "payment hub" is "a very important strategic transaction and potentially transformational" for his company.
Fundtech, a Jersey City maker of banking software for corporate cash management and foreign exchange, reported its net income grew 9%, to $1.6 million. Revenue was $30.6 million, a 3% drop from a year earlier, but up 8% from the second quarter.
Fundtech reported 18 cents of adjusted net income per share, the measure of operations that Wall Street follows, which beat the average estimate of analysts by a nickel.
Fundtech said it expects to earn 17 cents to 21 cents a share in the fourth quarter, excluding nonrecurring items, which also is above Wall Street's 16 cent average estimate.
