KEY POINTS:
Eftpos company Provenco today warned its ebitda profit would be half what it had previously signalled.
That sent its shares spiralling down 25 per cent -- 22 cents to 68 cents. The stock has lost 43 per cent of its value since February.
It had forecast ebitda of $9.5 million-11.5 million for the June year but now says it will only be $4m-5m.
"This change reflects significant movements in both its domestic and international businesses which have only just become apparent," chairman David Wolfenden said in a statement to the stock exchange.
He said because a significant portion of the company's business was contract based, the timing of revenues and profits were difficult to project.
"Movement in contracts and the delays winning new projects has seen revenues lower than projected in April and May."
Mr Wolfenden said the high value of the New Zealand dollar was having a negative impact.
Provenco's international business had experienced "significant slippage" with contracts and prospects.
He said the directors had reluctantly accepted that these potential revenues would not occur in this financial year.
"This slippage is frustrating as it has materially contributed to a shortfall in expected earnings for the current financial year," Mr Wolfenden said.
He said Provenco had not lost any significant business through the delays and market opportunities remained in line with expectations.
The company had just completed a strategic pilot project in Hong Kong and now had a foothold in India, the Middle East and Europe including Britain.
The company it was dealing with in Hong Kong, Sinopec, had a small but significant petrol station network in Hong Kong but over 30,000 petrol stations in mainland China.
"We have a growing presence in India and our technology is the first to deliver pay-at-pump forecourt technology in this large market."
"We continue to receive approaches from an increasingly wide number of companies operating in the retail oil industry and this can be attributed to our growing presence in these markets. We remain committed to the longer term opportunities for this business," Mr Wolfenden said.
He said the purchase of Indentics Group in Asia had further strengthened the regionalisation of its Vantex business, but revenue growth had been slower than expected.
In New Zealand, the company had had lower than expected sales.
As well, Provenco Payments had been hit by over-valuation of outdated stock to the tune of $600,000.
Mr Wolfenden said costs were well controlled.
"The directors are mindful of the challenge to secure revenues within financial years and remain very positive about the company's prospects."
"The company's diverse mix of international and domestic operations exposes it to changeable environments and a long term view is therefore required."
In reported a net loss of $1.9m in the six months to December, compared with $2.9m profit in the year ago period.
Todd Capital, the investment arm of the Todd family, New Zealand's wealthiest, bought a 12.9 per cent stake in Provenco in November at 96 cents per share. It owns 15.8 per cent. Other major shareholders include The Warehouse founder, Stephen Tindall and entrepreneur Duncan Saville.
- NZPA
