SRT Marine warns of contract delays due to coronavirus

(Sharecast News) - Maritime surveillance provider SRT Marine Systems warned on Tuesday that contracts scheduled for signature and commencement during March would now be delayed in response to the Wuhan coronavirus outbreak.
SRT said ?65m-worth of Middle East system contracts will likely be delayed, with its customers citing their own governments' response to the coronavirus outbreak, which was requiring them to "immediately and unexpectedly reprioritise their short-term operational focus".

The AIM-listed firm said the initial contractual milestone deliverables relevant to the current financial year were the GeoVS data centre systems, which would be required to be delivered within the first few weeks of the contract signings and generate approximately ?14m of revenues.

However, because of the expected delay, the first milestones were now expected to be completed in the financial year beginning 1 April.

SRT said the change would reduce expected year-end revenues to ?17.5m, leaving the group with a pre-tax loss of approximately ?3.8m for the year.

Chief executive Simon Tucker said: "The timing and nature of this delay is unexpected and very disappointing, and I apologise to my colleagues and shareholders for the angst this unexpected delay will no doubt cause.

"However, I hope it is of some reassurance to note that after many years of diligent work we have reached the point of contract signature and that once we are past this short delay the contracts will proceed and the significant revenue lost in the current financial year added to the next."

As of 0910 GMT, SRT shares were down 2.31% at 31.75p.