Software group Lombard Risk Management (LSE:LRM) announced on January 10th that it had won a new contract to supply its REPORTER product to “one of the UK’s leading building societies” as a “consolidated regulatory and MIS reporting system”. Clearly winning a new contract with a firm which must have some size is good news rather than bad news. But….after all the blather about how the client looked long and hard and referenced REPORTER with other users, blah, blah, blah Lombard does not actually name the customer or the value of the contract.
I cannot see why the customer would want to remain anonymous. I would have thought that its customers would not be unhappy that it was investing in upgrading its compliance software. If indeed they cared at all. But clearly that is what the customer wants. But if you are an investor in Lombard, as a result of this statement you do not know how big this customer is, what this contract is worth, whether it will make any material difference to this year’s profits or next year’s bottom line. Lombard might as well have released pictures of a nearly naked Brittney Spears taking her clothes off for all the difference it would have made to my knowledge of Lombard. The whole thing is bloody annoying for investors. It is just a pointless exercise.
For what it is worth I am happy to stick with my forecasts and analysis published on October 24th after the interims. My target price then was 16.1p and you can see how I derived it, a discussion about R&D capitalisation and a few comments from the chairman here
Tom Winnifrith writes for 10 leading financial and political websites in the UK and US. You can get alerts on all of Tom’s articles and follow his thoughts by following him on twitter @tomwinnifrith.com and his work is aggregated at his own free to access blog www.TomWinnifrith.com
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