(Alliance News) - NCC Group PLC on Friday lowered its annual guidance for the year to May 31, as it faces a "further deterioration in the macro-economic and market environment", citing layoffs in the US technology sector.
NCC shares slumped 35% to 100.00 pence each in London on Friday morning.
The Manchester-based cybersecurity company reduced its anticipated annual adjusted operating profit to a range of GBP28 million to GBP32 million, having previously expected GBP47 million. The new estimate would be at least 33% lower than the GBP48.1 million it posted for financial 2022.
NCC said market volatility was hitting its near-term revenue and profit, particularly in the North American tech sector. It said buying decisions delays and cancellations were being exacerbated by tech sector lay-offs, and the recent turmoil in the banking sector has hit market confidence, resulting in "reduced appetite" for spending on technology.
Interest rate challenges are also causing further inflationary challenges in the US and UK, NCC noted.
"These economic headwinds and current challenges to the group's cybersecurity revenues, which the board expects will persist into the next financial year, reinforce the need to implement the next chapter of the NCC group strategy," the firm said, adding it will look to cut costs.
Chief Executive Officer Mike Maddison said: "While we cannot control demand in the short term, the conditions we now face reinforce the rationale for our strategy, which I outlined in February. We remain confident that the group's strategy will deliver a more resilient business that is positioned to fully capitalise on opportunities to meet changing client needs in a dynamic cyber market."
By Tom Budszus, Alliance News reporter
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