(Alliance News) - Iomart Group PLC on Friday said it expects its annual results to be below expectations, although it made positive progress on its "refreshed strategy" in the first half of the financial year.
AIM-listed Iomart shares were trading 16% lower in London on Friday morning at 181.79 pence each.
Iomart said the majority of the customer base has remained stable, however, the slightly higher-than-usual customer churn seen in the final months of its financial year ended March 31 continued into the first half of its current financial year.
In addition, non-recurring revenue, principally hardware reselling and one-off consultancy activity, was GBP2.0 million lower year-on-year in the first half, and the company does not expect this revenue to recover during the second half.
As a result, Iomart anticipates results for the full year to March 31, 2022, to be below current expectations.
For the six months ended Thursday, it expects to report revenue of GBP52.0 million, down 7.6% from GBP56.3 million posted a year ago. Adjusted pretax profit, meanwhile, is seen at GBP9.0 million, down 8.2% versus GBP9.8 million a year prior.
More positively, the Glasgow-based cloud computing company said it launched a new brand during the first half, released new products and won its first customer in the hybrid cloud market - in which a private and public data centre are combined.
"Being only a few months into the execution of the refreshed strategy the expected success of the transition of the business will take time to flow through into results, however, the progress being made provides the board with confidence that the group will return to growth in the medium term," the company noted in its statement Friday.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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Iomart (IOM)