Alex van Someren: Satisfying revenue growth

Encryption hardware firm nCipher on Monday revealed that it gross margins for the third quarter of 2000 rose to 72% - more than double those it achieved in the same period last year.

The company's total revenues rose 11% from the second to the third quarter, to �3.6 m.

But, despite high earnings, nCipher, which is based in Cambridge, has yet to make a profit.

The company's operating loss nearly doubled during the third quarter, from �581,000 to �949,000.

During the same period last year, nCipher's revenues were �1.71m compared to �3.62m this year.

nCipher says the third quarter operating losses were caused by a sharp increase in its marketing and administrative expenses, as well as its research and development investments, following its launch, which raised �100m.

"Following our IPO we are in an extremely strong financial position and are comfortable with market expectations for the full year," chief executive Alex van Someren said on Monday.

nCipher shares closed 16p lower at 361.50p on Monday in London.