Companies: STR   

A turnaround is in train at Strategic Thought, the risk management software provider to many of the globe’s biggest organisations.

Floated on AIM at 120p in 2005, Strategic Thought’s shares peaked at 290p in 2006 before the business encountered short-term difficulties. However, a recent trading update covering the six months to September chronicled the strong progress made under Martin Metcalf, who took over as chief executive in June 2007.

Strategic Thought expects to report interim sales of £6.8m, up from £6.1m year-on-year and improved losses (before interest, tax, share-based payments, amortisation and exceptionals) of around £200,000. Healthy half-time cash balances of around £2.8m were also flagged up.

Driving growth was a 106% surge in licence sales for risk management software solution Active Risk Manager (ARM), with a strong performance from Europe offsetting US weakness. ARM, which ensures the right risk information reaches the right people at the right time, helps companies make ‘the right decisions, more often’ and is growing in relevance.

Metcalf, who has previously held senior roles with SAP, has restructured Strategic Thought and honed its sales focus, as evidenced by the recent clinching of a £1m plus contract for ARM with Rio Tinto, as well as work won with further divisions of aerospace and defence giant EADS.

Strategic Thought, which grew its top line by 16% to £13m during the year to March 2008, with losses widened to £2m (2007: £1.4m), is forecast to make a very modest loss from expanded sales of £14.3m this year and looks a savvy long-term recovery bet.

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Strategic Thought Group	AIM	£12.37m	47.00p	0.50p
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