LONDON (ShareCast) - (Sharecast News) - Pebble Beach Systems said it was considering acquisitions as the company reported a 25% drop in first-half earnings caused by the Covid-19 crisis.

The broadcast and streaming software company's adjusted earnings before interest, tax, depreciation and amortisation fell to £1.5m from £2m in the six months to the end of June.

Revenue dropped to £4.5m from £5.6m and orders received fell to £3.9m from £5.2m as customers delayed large projects, the company said. The company said it was confident in the outlook for the second half with a backlog of orders of £4.1m compared with £5.2m a year earlier.

The AIM-traded company's shares fell 18.5% to 10.8p at 10:32 BST. The shares have gained more than 50% since the start of 2020.

Pebble Beach said it would be hard to turn its pipeline of orders into firm commitments but that revenue was underpinned by service agreements, more recurring business and existing orders.

"Looking forward to the second half, there are indications that the market in which we operate is likely to remain flat but not decline," Chief Executive Peter Mayhead said. "Management continue to believe that the virus does not necessitate any change to our strategy for growth. However, the ongoing impact of Covid-19 on some segments of our market suggests this would be a good time to consider some M&A activity."

Mayhead did not go into detail about potential mergers and acquisitions. The company also said research spending as a percentage of revenue would be higher than normal but that the investment was needed to keep up innovation.

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