Quixant shares sink on fresh profit warning
By Josh White
Date: Wednesday 29 Jan 2020
(Sharecast News) - Gaming and broadcast technology products provider Quixant updated the market on its trading for 2019 on Wednesday, saying it expected to report revenue of $92.3m (£70.94m), and adjusted profit before tax of $10.7m.
The AIM-traded firm said the majority of that shortfall against expected revenue had been experienced in the gaming division, which also had a consequential impact on profit.
Net cash at 31 December 2019 totalled $16.2m.
"The previously-announced softness in demand from several of our gaming customers has continued for a longer period and been slightly more pronounced than previously anticipated," said chief executive officer Jon Jayal.
"This has impacted our financial performance in the gaming division over the second half of the year.
"We are confident in delivering healthy growth in 2020, however, the recent softness has led to having a more conservative view on the level of growth and we are reviewing costs in line with this lower revenue expectation."
Jayal said the company had initial orders for "significant" new business, which the board believed would contribute to sustained growth into 2021.
"Within Densitron, our new product lines in the broadcast sector have replaced lost revenue in the core Densitron business as these lower margin products go end-of-life.
"We expect this to continue into 2020 and therefore revenue within Densitron to be broadly flat."
Jayal said the group remained profitable and cash generative, with a "strong" balance sheet.
"The long-term market fundamentals remain intact and we look forward to providing more detail at the time of results in March."
Quixant said its results for the full year ended 31 December were expected to be announced on 23 March.
At 0943 GMT, shares in Quixant were down 21.31% at 161.32p.
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