21st Jan 2019 10:16
LONDON (Alliance News) - Dods Group PLC issued a profit warning on Monday after lacklustre December trading and a likely increase in delivery costs for its final quarter.
Shares in Dods were down 31% at 6.40 pence on Monday morning.
The business intelligence and publishing firm said while October and November trading was broadly in line with its expectations, December "closed significantly behind". This was attributed to "unprecedented business uncertainty".
Dods also anticipates fourth-quarter revenue will be hindered by increased costs of delivery as a result of long lead time contracts.
The combination of these factors means in its year ending March 31 Dods expects to post a loss before tax, excluding non-cash impairments. This compares to a GBP1.3 million pretax profit the year before.
Dods also expects "significantly lower than forecasted" adjusted earnings before interest, taxation, depreciation, and amortization for its 2019 financial year.
Both new product revenue and the contribution from its 30% associate investment of GBP1.7 million the previous year were "lower than expected".
As a result, Dods is "undertaking a review of the software, infrastructure, product offering, investments and intangibles to assess any further impairment impact for the year".
Dods's cash at bank on December 31 stood at GBP7.3 million, including GBP1.3 million of restricted cash.
Looking ahead, Dods is focused on generating growth via a possible merger or through acquisitions.
"Whilst the market is challenging, the board remains confident that, in conjunction with potential investments, the group is capable of sustainable profit streams in the longer term," Dods said.
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