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Misys, the software and services group, is discussing compensation with the chief executive of its banking division after unexpectedly announcing that he would be leaving at the end of 2005.
Kevin Lomax, the group’s chief executive, refused to give reasons for Ivan Martin’s abrupt departure.
Mr Martin was on a one-year contract. Last year, he received a total package of £615,000 including a bonus of £256,000. Mr Lomax will run the banking division for the immediate future.
Analysts at Cazenove said the departure may be linked to the profit warning Misys issued in September, which was caused by delays in implementing contracts.
It was followed by a shareholder revolt before the group’s annual meeting.
The group subsequently abandoned a retention bonus scheme for two directors and Mr Lomax relinquished his second role as chairman.
But Misys was yesterday able to release a better-than-expected trading update, which showed first-half banking revenues up 10 per cent and healthcare revenues up 5 per cent.
Mr Lomax said the statement was “at the top end of our expectations”.
Misys shares closed up 16¾p to 230¾p yesterday, even though operating margin in the banking division is expected to be about 12 per cent for the first half compared with last year’s first half of 17 per cent.
“In margin terms, we are where the market expected us,” Mr Lomax added.
Order intake in the banking division for the first half was up 27 per cent and the order book of £31m was up 9 per cent on the same period last year.
In the trading update, Mr Lomax said that, while its lead businesses were showing encouraging progress, “we recognise that there is more to do to deliver increased value to our shareholders”.
Revenues and operating margin in its general insurance division were in line with last year while revenues in the Sesame division, which supports financial advisers, were 13 per cent higher than last year’s first half.
Misys said it expected earnings per share in the range of 6p to 6.5p in the first half compared with 6.8p last year.
Kevin Ashton, analyst at Bridgewell, said the trading update dispelled fears that Misys’ problems went beyond contract delays into more fundamental problems with its products.
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