Altra Reports Revenues, Trades Up in 2000
Bucking the tech trend, five-year-old electronic trader Altra Energy Technologies Inc., coming off a year of trading and revenue increases, expects to make it into the black in this first quarter of 2001.
"We were here before the Internet, we lived through the Internet browser-based tech explosion, and we're still here at the back end," said Altra CEO Paul Bourke.
"Despite an increase in competition from significant industry players, we experienced our best year ever throughout all divisions of the company." Both trading exchange volumes and software sales were up significantly in 2000, he added. While not divulging overall trade volumes, Bourke said natural gas volumes traded on Altra Market Place (formerly Altrade) were up by more than 35% in 2000 over 1999. The company set an all-time monthly record for the platform in December with more than 8,000 natural gas trades.
Among the "many-to-many" platforms (as opposed to the one-to-many, i.e. EnronOnline), Altra estimates it had about 90% of the electronic natural gas business, 100% of the natural gas liquids online trades and 60% of power trades. Bourke noted that some of his new competition, ICE, TradeSpark and TrueQuote, had only come online in the fourth quarter. "Over the first six months of this year, we'll get a better feel for the growth of the online market share and how it will be distributed among the different systems."
As for the overall market share of online trading (including EnronOnline) vs. voice/broker deals in 2000, Bourke said he believed about 30% of natural gas trading, over 50% of gas liquids trading and 6% to 8% of power trading occurred online. He believes those percentages will increase and also that more financial trading instruments will move into the online market.
The next movement will be toward integrated and back office products, an area where Altra claims to be the "only energy technology company that provides both an independent online trading exchange and software products to help process the deal from trading to scheduling to risk management to accounting." The company said its revenue from software increased 15% year over year as it picked up new customers from among major trading companies.
NGL trading on Altra continues to be strong, with more than 250 million bbl traded in 2000.
While its Altra ePower gained 725% in one year of trading and set a company record last October of 21.4 million MWh traded, the numbers should increase after the launch of a fully web-based power platform in 1Q 2001, the company said.
While its venture capital backers, Battery Ventures and Austin Ventures, remain firmly committed to Altra, the company will be working to strengthen its bottom line, looking toward an eventual initial public offering. "The view of the capital market has changed radically in the last six months. Before there was very little regard for the bottom line. They now are looking for businesses more in line with traditional companies. The good news is we will be profitable this quarter and expect to remain profitable. This is in line with the public company mindset," Bourke said. There could be a window of opportunity for an IPO either in the second half of this year or the first half of next year. "We will be concentrating on growing and increasing our profits to be in a position to have that alternative when the markets open up."
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