UPDATE 2-Misys back to growth as new products deliver in Q3

* Q3 revenue up 7 percent to 85 million pounds

* Q3 order intake up 34 percent to 49 million pounds

* Says on track for medium-term targets

* Shares up 4.2 percent

(Adds CEO comment, analyst reaction, shares)

By Paul Sandle

LONDON, April 6 (Reuters) – British software company Misys
(MSY.L: Quote, Profile, Research) posted a 7 percent rise in third-quarter revenue, helped
by new products serving banks and financial markets.

Misys, which sold most of its stake in its Allscripts-Misys
joint venture last year, said on Wednesday revenue in the three
months to February was 85 million pounds ($137 million), taking
revenue growth into positive territory in its 2010/11 year.

“We have made a big investment over the last several years
to get new products into the market and those investments are
really paying off,” chief executive Mike Lawrie said.

Misys shares, which had outperformed European peers (.SX8P: Quote, Profile, Research)
by 32 percent in the past 12 months, rose 4.2 percent to a
six-week high of 341 pence.

Matrix analyst Rajeev Bahl the Treasury and Capital Markets
(TCM) business was pretty solid, helped by deals that slipped
from the end of Misys’s second quarter. “In the core banking
business it is nice to see orders in growth territory — they
had declines in the first half — so the new products there seem
to be starting to do the business for them.”

Misys said TCM orders rose 50 percent, while banking orders
were up 17 percent. It became TCM sector leader, with about a
third of the market, when it bought Dublin-based Sophis for 375
million pounds in November. [ID:nLDE6AB08L]

Misys, which competes with Swiss company Temenos (TEMN.S: Quote, Profile, Research) in
banking, said it won six new customers for its Bankfusion retail
banking platform, taking the total to 19 in the year to date.

“We are getting some traction (in Bankfusion),” Lawrie said.
“This is a long-term product programme but we are certainly
pleased with the first year.”

However, maintenance revenue for both divisions was lower.

Lawrie said that was due to sector consolidation — the
group has only recently stopped supporting legacy systems for
failed investment bank Lehman Brothers — and new customers that
had not opted for maintenance until new products were live.

“I think as we exit this year we should see some growth in
maintenance and certainly some growth as we get into our next
fiscal year,” he said.

The company said it was on track for its medium-term target
of 5-8 percent annual revenue growth and adjusted operating
margins of 20-23 percent, unchanged from its first half.
(Editing by Dan Lalor)
($1 = 0.6204 pound)

UPDATE 2-Misys back to growth as new products deliver in Q3