Online Resources Corp. is continuing the development of its new strategic plan, which it intends to detail next month.
When Joseph L. Cowan came on as Online Resources' chief executive in June, he explained that his approach was to spend three to five months studying the banking and bill-payment vendor and developing a new strategy. The company should know within six months whether the changes have improved its performance.
"Our planning process is well under way," Cowan said in a press release Nov. 2. The new plan should be submitted to the board in December, and "I look forward to sharing it … once we have finalized our course of action," he said.
In the meantime, Cowan praised the Chantilly, Va., company's performance and said payments and online banking adoption are growing.
Online Resources' revenue grew almost 1%, to $36.8 million, in the third quarter from a year earlier. It had a net loss of $711,000, compared with a profit of $388,000.
Thomas C. McCrohan, an analyst for Janney Capital Markets, wrote in a report published Friday that although Online Resources beat its revenue guidance of $36.6 million, the company has "an expectation for sluggish growth as client attrition continues to affect revenues."
However, McCrohan also stressed that Online Resources is winning new business, including a renewal of "its largest full-service online banking and bill-pay services client," which it did not name.
McCrohan stressed that Online Resources has been investing in its sales and retention efforts, which "will result in improved financial trends … over the longer term," McCrohan wrote. Even as some prospective customers remained unsigned at the end of the third quarter, Online Resources still had a strong quarter for sales, he wrote.
Cowan, who has a background in software, was hired by Online Resources as the permanent successor to its founder, Matthew P. Lawlor, who left last year. There were two interim CEOs before Cowan came on. Cowan has said his background as an outsider to the financial services industry could help Online Resources consider new approaches to its market.