Engineering and industrial software firm AVEVA (AVV) gained 6.7% to £37.96, topping the list of FTSE 100 gainers on a strong third quarter performance.

The company said revenue increased about 1.5% in the nine months to 31 December 2020, underpinned by a contract renewals in the final quarter of the year.

Organic constant currency revenue growth in the three months to 31 December 2020 was over 26%, driven by a ‘significant number of scheduled subscription renewals, including a large three-year contract renewal in the food sector,’ the company said.

The early renewal of a large three-year EPC contract that had been scheduled for AVEVA’s Q4, and the conversion of two large contracts in the marine sector from annual fees to multi-year subscription, had also boosted revenue.

The order pipeline for the remainder of the financial year was solid, supported by efficient digital demand generation and several large contract renewals, albeit fewer than seen in the third quarter, it added.

The company said its acquisition of OSIsoft was expected to receive approval from the Committee on Foreign Investments in the United States in early February, with completion expected to occur shortly after.

OSIsoft continued to perform well and achieved billings growth of 8.5% in the financial year to 31 December 2020, in line with management plans.

Numis analyst Will Wallis said: ‘AVEVA has reported a strong Q3, which we think should dispel lingering concerns over the somewhat weaker Q2 reported earlier in the year.

‘While revenue in the quarter has been helped by a few large deals, we think that performance among the rest of the pipeline has been very solid.’

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Issue Date: 15 Jan 2021