23rd May 2018 12:53
LONDON (Alliance News) - Frontier Smart Technologies Group Ltd shares plunged Wednesday after the company lower its 2018 earnings guidance.
Shares were trading down 40% midday Wednesday at 90.25 pence.
"Trading in Q2-2018 has been difficult and the outlook for smart audio in 2018 is weaker than previously expected. As a result, the group is unlikely to achieve market expectations for the full year and we are therefore implementing a cost-reduction programme," Chief Executive Anthony Sethill said.
The digital radio and audio devices firm expects earnings before interest, taxes, depreciation and amortisation of around GBP800,000 for 2018, down 57% from GBP1.9 million reported in 2017 end.
For the first half of 2018, the company expects an Ebitda loss of GBP1.5 million, while for the second half it estimates Ebitda of around GBP2.3 million.
Frontier full-year sales are predicted to total GBP34.9 million, down 14% on 2017 revenue of GBP41.0 million.
In the company's digital radio division, sales and order book for 2018 were affected by stock surplus in Norway.
"The board expects Frontier's digital radio revenues to normalise in H2-2018 and return to growth in 2019 driven by the continued development of DAB markets in Germany, France, Italy and Benelux, and the forthcoming FM switch-off in Switzerland," the company said.
The group also expects revenue growth in its smart audio division to be slower than previously predicted, as US companies battle for market position within the voice assistant technology excluding third party brands.
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