12th Oct 2015 08:35
LONDON (Alliance News) - eServGlobal Ltd, a mobile money payments business, on Monday said it now expects to record a loss before interest, tax, depreciation and amortisation for its current financial year, a result of delays in closing certain high-margin orders ahead of the year end.
Shares in eServGlobal were down 24% at 5.50 pence on Monday morning.
eServGlobal said its EBITDA loss, adjusted to exclude restructuring costs, equity accounted impact of investment in its HomeSend joint venture with MasterCard and BICS, and foreign exchange gains or losses, is expected to be in the range of EUR5 million to EUR6 million on revenue in the range of EUR17.5 million to EUR18.5 million.
"This is clearly a disappointing result. With the benefit of continued support from its shareholders, the company has taken significant strides in the second half to de-risk the business for 2016. We have exceeded our original cost reduction targets and focus on cost optimisation and re-organisation will continue in 2016," Chairman John Conoley said in a statement.
The company said the delayed orders remain "largely" in the pipeline. It is expected they will be booked in the first half of the next financial year.
In addition, the company said there have been "significant additional costs" in delivering prior-period projects, in turn causing further delay in recognising work in progress.
Total overheads for the year to October 31, 2016 are expected to be below EUR9 million, against EUR12.8 million expected for the current financial year. eServGlobal is targeting revenue of between EUR20 million and EUR22 million in the next financial year and expects to be EBITDA positive then.
By Samuel Agini; [email protected]; @samuelagini
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
eServGlobal