Micro Focus expects lower FY revenues in 2021

Micro Focus expects to report a revenue decline of 5% on a constant currency basis but said it "remains on track" to achieve its stated goal of revenue stabilisation towards the end of the 2023 trading year.

License revenues were expected to increase by approximately 6% when compared to 2020, driven by continued improvement in sales execution and the benefits of investments in its growth portfolios, but maintenance revenues were seen falling 9%, software-as-a-service and other recurring revenues were expected to drop 4% and consulting revenues were projected to have slipped 8%.

The FTSE 250-listed group's adjusted underlying earnings margin was expected to be approximately 36%, reflecting the revenue decline, targeted investments and the impact of its transition to a single enterprise-wide platform.

Micro Focus ended the period with cash balances of approximately $560.0m and net debt of approximately $4.2bn.

As of 0915 GMT, Micro Focus shares were down 2.54% at 402.20p.