Sirius shares crash 18% after profits and revenue targets are missed
IT provider Sirius Financial Solutions will report lower than expected results for the year to 31 December 2003 after delays in closing "a couple of large corporate contracts."
In a statement updating its trading performance for the year to 31 December 2003 the company said that "whilst expecting to report a profit" it did "not expect to meet market expectations for profit and revenue for 2003."
This admission saw its share price fall 18% to close at 74.5p on 22 December, the day the announcement was released. It is currently trading at similar levels.
The statement said that "some unexpected delays and the increasingly lengthy period of time taken in completing contract paperwork" were the reasons for its failure to meet financial expectations.
Sirius chief executive Steve Verrall said that the drop in profits was due to "a couple of large corporate contracts taking longer to finalise than anticipated".
The update said that in order to attain a more predictable, sustainable and profitable revenue model in future, the company planned to introduce a "more contemporary licence pricing strategy" in 2004, which would see it "move away from higher value initial licence fees to an annually renewable fee."
Verrall said the change would only affect large corporate buyers, and the company had started to put forward proposals that charge on an annualised basis. "It doesn't really affect the smaller brokers because virtually every broker we sell to in the UK buys it on a rental basis," he said.