LONDON (ShareCast) - Starcom, which supplies wireless technology for remote tracking, said it has to defer the recognition of revenues on orders due to the affects the Crimea crisis has had on a distributor in Ukraine.

The distributor, which entered into purchase orders in December 2013 to purchase 4,000 WatchLock units for $1m, told the company that it will be unable to honour the orders due to the political and economic upheaval in Ukraine.

Tensions in Crimea remain high after Moscow finalised a treaty annexing Crimea from Ukraine to re-join Russia as a sovereign state.

“Therefore, due to the uncertainty of the situation, and following consultation with its auditor, the company has taken the prudent accounting measure of deferring recognition of these revenues from the 2013 accounts,” Starcom said.

“The WatchLock units are still residing in a warehouse in Israel, allowing the company to hold them for the customer until a later date, or to sell them to another customer.”

Shares fell 5.48% to 17.25p at 15:04 on Friday.

RD

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