LONDON (ShareCast) - (Sharecast News) - Financial services provider STM Group said on Friday that the second half of the year to date had been "a frustrating period" for the company, with certain anticipated new business revenues being slower to materialise than expected.
STM stated that as a result of the delays, it now anticipates approximately £400,000 less in full-year revenues and underlying earnings than originally projected.

However, STM noted that a number of large pieces of business currently under negotiation were likely to generate "a material uplift" in revenue and profitability for 2021 but cautioned that as uncertainty remained as to whether these policies would be incepted before year-end, the group decided that they should not be reflected in its revised forecasts.

The AIM-listed group also highlighted that its EBITDA position had been further impacted by approximately £100,000 as a result of a slower than anticipated reduction in its cost base.

"Whilst the majority of the savings on software fees have come to fruition, the staff resource savings have yet to substantially materialise but are expected to do so moving into 2022," said STM.

"As a consequence of the above, the board now anticipates that the group will report revenue of £22.5m, EBITDA of £3.4m and statutory profit before tax of £1.5m for 2021."

As a result, STM now anticipates profitable growth next year, with the firm now targeting pre-tax profits of at least £2.0m, excluding any contribution from its London & Colonial annuity product, given the small volume of policies and uncertainty on timing.

As of 0945 GMT, STM shares were down 4.64% at 32.90p.

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