Warning of ‘flat’ year at IT group SciSys triggers share price fall

March 27, 2015

Shares in specialist IT group SciSys continued to fall today after its chairman warned that its performance this year would be “flat”.

Dr Mike Love, pictured, who co-founded the group, which has a base in Bristol, admitted the business faced challenges last year but insisted its 2014 financial results, announced yesterday, had been solid.

Pre-tax profits doubled last year to £3m on sales down just over £2m at £40.3m at the group, which develops complex IT projects in sectors such as space, defence and media for clients spanning the European Space Agency, the BBC, Airbus and the Ministry of Defence.

However, shares fell by more than 10% in early trading yesterday and continued to come under pressure today, dipping another 1.76% by lunchtime.

In his comments accompanying the 2014 results, Dr Love said: “Our order book at the beginning of 2014 was £30m and remained consistent across the year. We continue to see a number of opportunities both in the UK and on mainland Europe which we are confident we can convert into contract wins.”

He also said the group, which employs 450 staff across its offices in Chippenham, Bristol, Leicester and Reading and two in Germany, would benefit from a full year’s contribution from recently acquired retail industry software application developer Xibis.

Dr Love added: “Whilst we face headwinds during the current year in the form of the continued strength of sterling and some concerns around public funding as we approach a General Election in the UK, we believe the continued margin improvement and the group’s cash performance to be indicative of a strong underlying business.

“We currently project that the second half of the year will be stronger than the first and overall anticipate a flat 2015 compared to 2014. Nevertheless, our longer term strategic aims have not changed; our target remains to achieve double digit margins by the end of 2018 underpinned by top line growth. At this juncture, we see no need to revise these goals.”

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