It had already been a disappointing year for Blancco Technology’s (BLTG) shareholders before the shares tumbled a further 26 per cent on the day of its latest profit warning. Management plans to reverse £2.9m of sales booked for two contracts during the 12 months to 30 June this year and has revised down its sales expectations for that year.
Sales are now expected to be 15 per cent ahead of the prior year at constant currency, down from the 30 per cent gain announced in July. That’s resulted in a 41 per cent cut to adjusted cash profit expectations, to £4.1m. On the back of this announcement, chief executive Pat Clawson has resigned, with interim chief financial officer Simon Herrick temporarily stepping in to the top job.
Management said cash flow had not been affected by the reversal of the revenue for the two contracts. That’s just as well, since it had already been forced to conduct a review of its cash flow following the release of its half-year results in March. Costs from previous acquisitions, plus a large government contract delay during its final quarter, meant it needed to raise an additional £4m in cash.
