Q2 Trading statement

04 July 2003

Temenos announces new contract signings for Q2 2003

• EXCEEDS Q2 ILF SIGNINGS TARGETS BY 9.4%
• APPROXIMATELY 100% VISIBILITY ON 2003 TARGET REVENUES
• EXCEEDS Q2 REVENUES AND EARNINGS TARGETS
  

Geneva, Switzerland, July 4th, 2003. TEMENOS Group AG (SWX: TEMN), a global vendor of integrated banking software, today announced new contract signings for the second quarter of 2003.

The value of Initial Licence Fees (ILF) for new contracts signed during the second quarter of 2003 amounted to USD 14.0 million, 9.4% higher than our target of USD 12.8 million. We exceeded our target in Europe, CIS and in the Middle East; and were slightly below target in Asia Pacific and in America. ILF signings comprised 72% new licences and 28% upgrade sales to existing customers compared to 75% and 25% for the previous quarter.

During the quarter, new single and multiple sites licence contracts were signed with Standard Chartered Grindlays (Offshore) Ltd, Instituto per le Opere di Religione (Vatican State), Kuwait Investment Company in Kuwait, Post Bank of Iran in Iran as well as a European Government Agency which will be using our product in a debt collection department.

In addition to exceeding our target ILF signings, we exceeded our targeted revenues for the quarter while managing our cost base within our expectations, thus establishing the group back to growth and profitability. Furthermore we generated positive net cash flows for the quarter and for the half year.

“We are very pleased with our performance during the second quarter of this year. We exceeded our signing targets for the fourth quarter in a row, our visibility is improving. We are very focused and we are executing according to plan. The business climate continues to remain challenging in terms of spending amongst our client and prospect base. We have experienced pressure on pricing however, we believe that a level of stability is returning to the market” said George Koukis, Chairman and CEO.

2003 Guidance
Anticipated 2003 revenues originating from business closed to date represent approximately 100% of our target revenues of USD 130 million. Expected signings during the second half of the year, to the extent recognised in 2003, would represent an upside to our full year 2003 targeted revenues. Further guidance will be discussed during our Q2 presentation.

“We are delighted that our business outlook is good and we are well positioned to deliver an EBITDA of approximately USD 25 million”, said George Koukis, Chairman and CEO. Presentation of Q2 key financials and operational update will be released on Thursday July 31st, 2003.

-ENDS-

About Temenos
Founded in 1993, Temenos Group AG is a provider of integrated modular core banking systems to over 590 financial institutions in 110 countries worldwide. Temenos software provides banks with a single, real-time view of the client across the enterprise, enabling banks to maximize returns while streamlining costs. Whether providing 24/7 functionality to the wholesale, retail and private or universal banking sectors, partnering with central banks on core system replacement, or working with the World Bank on solutions for the emerging markets, Temenos knows banking. The company has a transparent approach to its operations and brings to bear its experience, expertise, commitment and professionalism on every project. Headquartered in Geneva, Switzerland, the company has 43 offices in 33 countries and is listed on the main segment of the SWX Swiss Exchange (TEMN). For more information please visit www.temenos.com

For more information, contact:

Max Chuard
Temenos Director
Corporate Finance & IR
Member of the Executive Board
Tel: +41 (0) 22 708 1157
Email: mchuard@temenos.com

Ben Robinson
Temenos Investor Relations Manager
Tel: +44 (0) 207 290 3012
Email: brobinson@temenos.com

Bianca Morgan
Temenos PR Manager
Tel: +44 (0) 207 423 3751
Email: bmorgan@temenos.com

Chris Patmore
Team 660
Metia for TEMENOS
Tel: +44 (0) 20 3100 3596
Email: chris.patmore@metia.com