Publishing Technology plc (AIM: PTO.L), the leading provider of world-class software and services to the global publishing industry, announces that it expects its results for the year ending 31 December 2014 to be below market expectations and broadly in line with the full year results for 2013 . In particular, the first half results for the 6 months ending 30 June 2014 are likely to show a loss due to recent actions taken by the Company to rectify implementation problems on some current contracts, resulting in additional product development expense and deferral of revenue which was expected to be recognised in the period.
When in March 2014, the Company appointed Michael Cairns as its CEO with effect from 1 April 2014, the Board charged him with conducting a strategic review to identify areas where the Group could improve its performance and ensure that as a business it is easily scalable and optimised for rapid growth.
Michael’s review is due to be concluded shortly and the full findings are expected to be announced at the same time as the Company’s interim results for the six months ending 30 June 2014. In the short term, Michael has reported his interim conclusions to the Board and he has taken some immediate actions that he, with the full backing of the Board, believed were necessary to improve the Company’s business performance.
Overall, Michael’s initial conclusions endorse the Board’s view that the Group is now poised to capitalise on the significant research and development investment of well over £10m which has been made in recent years, which has embedded considerable value in its products and services. The Company’s future revenue is underpinned by some substantial new contract wins, including £4m of new business in the last few months, and it is benefiting from supportive sector trends, as publishers increasingly seek partners to help them commercialise their content digitally. As a result the Board believes the outlook for the business remains positive.
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