Earthport Interim Loss Widens But Maintains Full-Year Expectations

27th Mar 2018 13:22

LONDON (Alliance News) - Earthport PLC said on Tuesday its interim loss widened as it encountered "clear challenges" though it remains confident in meeting expectations for the remainder of the year.

Revenue grew 8% to GBP15.4 million for the six months to December 31, from GBP14.3 million a year earlier "despite the challenges of delays in expected contracts, client implementations, and a change at one of our leading e-commerce clients". Its pretax loss widened to GBP4.7 million from GBP3.3 million.

The adjusted gross margin slipped to 64% from 70% a year prior, due to network delivery costs, the geographical mix of transactions, and the associated differences in transaction price per corridor, in-line with management expectations.

Administrative expenses increased by 10% to GBP14.3 million, mainly due to investment in "capturing the growing opportunities pipeline in existing clients and sales capacity, in the e-commerce vertical and in Asia".

"While there have been clear challenges as we announced in December 2017, Earthport's core offering and market positioning remains strong," said interim Chief Executive Phil Hickman.

"We currently have a strong pipeline with increasing opportunities within the banking and e-commerce sectors, as well as in new geographies. This, coupled with continued growth in our existing client base, gives us confidence in meeting our expectations for FY 2018 and becoming cash flow breakeven by the end of FY 2019," Hickman added.

Shares in Earthport were down 0.4% at 11.40 pence on Tuesday.

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