Business Weekly - Cambridge, UK

The record performance prompted UBS to trill about the Cambridge web software company’s "exciting" global growth prospects and upgrade its stock valuation to 380p.

The share price rose 5.7 per cent (17.95p) to 331.45p after the results to the end of September were posted.

Autonomy third quarter revenues were up 76 per cent year on year to £14.334m (Q3 2004: £8.157m) and pre tax profit was 300 per cent ahead at £2.805m (£701k).

Record nine month revenues were up 40 per cent and nearly equalled the whole of last year’s returns.

It was the company’s 23rd consecutive quarter of profitability. CEO Mike Lynch said the results were once again driven by the adoption of its new generation IDOL 5.0 product. "We’ve achieved these results despite Q3 seasonally being our quietest quarter," he said.

The upbeat broker’s note from UBS said there was much more to come from Autonomy. Not only were the results ahead of expectations but there was reason to expect fresh success.

It said: "We believe there may be some upside potential to sales forecasts. prospects for the group remain exciting. Technology integration is now complete with etalk’s Qfiniti ready to ship and overseas expansion planned.

"Autonomy’s IPTV technology has good potential with a sale already made to a major media group and its Joint Venture in China is already in test launch. Core sales, as seen in these results, also remain strong.

"Our PT of 380p is based on a 70p a share value assigned to the China Netcom JV and reflects our view of continued strong growth for the company."