ECSC falls behind the curve on sales, shares plummet
ECSC Group
52.50p
16:39 22/06/23
ECSC, the cyber security specialist, warned on full-year sales and profits due to delays in closing new deals.
FTSE AIM All-Share
745.65
17:14 27/09/24
Software & Computer Services
2,510.45
17:10 27/09/24
Cyber security continued to rank high on company boards' list of priorities thanks to the recent recent proliferation of high profile incidents, the company said in a statement.
Plans to hire new staff, including a sales team, and open new operating locations were all on track as well.
Its pipeline of deals was also developing as foreseen, but "conversion of sales pipeline into reported revenue is taking longer than anticipated," management said.
Hence, revenues from consulting and managed services were running six weeks behind the originally expected growth curve.
So the AIM-listed company now expected full-year sales and operating profits on an EBITDA basis to come in lower than it had previously anticipated.
Nonetheless, the board kept the faith, saying organic growth was still the best track to follow for the firm, telling markets the long-term outlook for ECSC continued to be "encouraging".
Company boos Ian Mann commented: "The scale-up of the operations has progressed well so far. Whilst the new sales team is bedding-in, we are experiencing a delay in revenue growth that will directly impact FY17 results. However, we are seeing encouraging sales pipeline growth and the management team remains focussed on harnessing the market backdrop for the longer-term benefit of the Company."
As of 1431 BST shares in ECSC were plummeting 30.0% to 315.0p.