Still reeling from the cost of moving its headquarters to Houston, Texas, from London, and having to pay an out-of-court settlement to the Performing Rights Society, software design and services company Learmonth & Burchett Management Systems Plc saw increased end of year losses. The deficit was up to ú5.3m from ú746,000 and the company was lucky to settle out of court for ú2.4m, which it gets to pay in installments over the next four years. Originally, the Performing Rights Society sued Learmonth for ú15.9m over alleged negligence and misrepresentation, relating to a failed project to migrate the society’s membership system to Unix (CI No 2,453). Although the company always maintained the case had no merit, chairman Rainer Burchett said the company was pleased to have settled, so removing the uncertainty and distraction it brought to our affairs. And the market seemed to agree; share price rose eightpence to 265 pence by early afternoon yesterday. The project that led to the lawsuit had been undertaken by the company’s general consulting division, which was sold last year to Parity Plc for ú1.75m (CI No 2,453). But putting the misery of the last year behind it, the company was upbeat in its end of year statement, saying that the second half had seen a steady rise in sales and it expected to return profits next year. Burchett said the reorganisation of the company, which has included a one-for-five rights issue in July 94 (CI No 2,453) that raised ú2.3m, the move to the US (CI No 2,605), the loss of the ‘Learmonth’ when chief executive Roger Learmonth stepped down (CI No 2,513), and the sale of the consultancy business, had been almost completed. All that remained was for the development team to move to Houston. As a result, LBMS faces the future in excellent shape, said Burchett, whose office will remain in the UK but the company does not appear committed to remaining quoted in the UK, although it gave no details of when it might move wholesale to the US. Its US operations, where the company’s emphasis now firmly lies, reported a rise in turnover of 13%; Asia-Pacific sales were up 16%; but the UK and European divisions let the company down, with sales down 15% because of falling service business, although there was a late rally in the second half. Also changes in the company’s structure and management had resulted in a 40% lift in average revenue per employee compared with the previous year, it said. Its Process Engineer Windows-based application development tool, revamped and relaunched last year, was the fastest-growing software product and accounted for 33% of licence revenue. But new products are planned for this year, including an object respository that will be part of a product family aimed at cashing in on object engineering.
