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Contract Delays Bring Down eServGlobal's Full-Year Revenue

Wed, 24th Jan 2018 11:18

LONDON (Alliance News) - Digital transactions company eServGlobal Ltd said Wednesday revenue is expected to fall short of previous expectations due to delays in the signing of certain significant orders.

Revenue for the 14 months to the end of December is now expected in the range of EUR8.3 million to EUR8.5 million, down from AUD21.6 million - EUR14.1 million at Wednesday's exchange rate - for the 12 months ended October 31, 2016.

In February, eServGlobal changed its financial year end from the end of October to the end of December. It also changed its reporting currency from Australian dollars to the euro.

Signed agreements worth EUR3.0 million in revenue expected in the fourth quarter of 2017 has been signed in January, with the full value recognisable over a three-year period.

eServGlobal reported good progress in its planned cost reductions in its core business, using proceeds from fundraising to remove EUR2.0 million in costs from the second half of 2017. The company expects to starts 2018 with a total cost base on an adjusted like-for-like basis of EUR12.8 million, expected to reduce further across the year to at least EUR12.0 million.

"Forecasting of precise order timing remains a difficult discipline in the markets in which the core business operates, and yet the shortfall of revenue is still in play for 2018. eServGlobal is pleased to have started 2018 with two significant orders in the core business that were delayed from 2017," said Executive Chairman John Conoley.

"I am further satisfied that we achieved our initial goals on cost reductions which helps us maintain our aim of reaching operational Ebitda breakeven during 2018. As was planned we now start the new financial year in a stronger position than the comparative period 2017. Furthermore the board remains confident in the immediate and longer term opportunities presented by the HomeSend Joint Venture," Conoley added.

Shares in eServGlobal were down 7.0% at 11.62 pence on Wednesday.

By Dayo Laniyan;

Copyright 2018 Alliance News Limited. All Rights Reserved.

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