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Sheffield data specialist Cirata seals $2m deal to support major US bank

Sheffield data firm Cirata has announced a deal worth around $2m with IBM which will support a top three US bank – its biggest contract since the firm restructured last year.

The business – which also has offices in Newcastle, Belfast, California, China and Japan – said the live data migrator (LDM) contract is the biggest of its kind with IBM to date, and will start on December 31. Cirata said it sees the contract as the “next step” in its ability to provide long-term support to the banking customer as it builds out its data architecture and implements Cirata’s product “into one of the most demanding enterprise environments”.

The firm said: “The LDM contract also represents the first transaction completed under the terms of the new OEM agreement to integrate Cirata’s LDM technology inside IBM’s Big Replicate solution, previously announced on 2 October 2024. This will be the largest value contract for LDM since the restructuring of the company in March FY23, the largest LDM contract to date in financial services and the largest implementation through the IBM Big Replicate platform.

Following the deal announcement Cirata said it had withdrawn its financial year 2024 bookings guidance, due to some major customers opting for one-year terms rather than multi-year terms, as well as movement of pipeline opportunities and bookings from the end of this financial year into the first half of 2025. New guidance will be issued in its regular quarterly trading update.

Stephen Kelly, CEO of Cirata, said: “Cirata has set itself the challenge of delivering its LDM product to meet the needs of the most demanding enterprise technology environments. The announcement of the LDM contract through IBM Big Replicate proves Cirata is well positioned to meet those needs. We look forward to shaping a long-term relationship with this top 3 US bank as they build out their data architecture in response to the rapidly changing AI and Machine Learning landscape.

“The recent renewal of our OEM agreement with IBM set the stage for the closure of this LDM contract, and so the win itself is doubly important. It is not only the largest transaction in the Company’s history for LDM within financial services, it is also the largest implementation of LDM for Big Replicate through our highly valued partner IBM.

“While today’s announcement is a clear signal of our technology’s capabilities and our own ability to build commercial trust, it is also a reminder that large contracts can make our business lumpy and that forecasting has indeed proved challenging. In parallel with the announcement of this new contract, Cirata withdraws its FY24 bookings guidance. This is mainly due to the LDM contract and one other contract being of a one-year rather than a multi-year term and the movement of pipeline opportunities and bookings expectations from Q4 FY24 to H1 FY25, which has caused a sufficiently wide variation to expected outcomes for bookings. Our focus continues to be on the long-term potential of our support for this top US bank, our partner IBM and our other customers.

“I thank our colleagues for getting us towards the end of the recovery phase of the company. We inherited a broken business from a peak annualized cost base of $45m per annum to a company exiting FY24 with a cash overhead of circa $20m per annum. Our cash burn in Q1FY23 was an unsustainable $11m per quarter and as we exit Q4, Cirata will be on a path towards cash flow breakeven.

“That adjustment has involved more than halving the workforce, with all the trauma that entails. However, our colleagues are responding to that challenge by building and hardening a differentiated product and selling successfully into one of the most demanding environments in IT. The Data Integration product performance has improved from -87% decline in Q1FY23 to 180% growth in the last reported quarter, Q3FY24.

“Tomorrow, we roll up our sleeves and go again as we seek to close out further opportunities in Q4 and move into the Growth phase from FY25”.

Original artice – https://business-live.co.uk/all-about/yorkshire-humber