Starcom warns of earnings miss amid African order delay
Source - SMW
Remote tracking technology company Starcom said it now expected to break even at the earnings level in 2018 following a delay to a key order in Africa.
Revenue for the year through December was still expected to slightly exceed current market expectations of $5.9m, the company said.
However, Ebitda was expected to be around breakeven, below market expectations of around $485k.
Starcom had announced in November a contract win from a distributor in a North African country, which included an initial order of Helios Advanced units plus related software worth around $1.1m.
Delivery of the order was expected to be made by the end of December but the distributor was subsequently informed by the end user -- a government department -- that there could be a delay in processing the payment.
Local conditions appear to have since exacerbated the delay, with payment now committed for the end of January, Starcom said.
As a result, the hardware component of the order value would now be recognised in 2019 first-half results, though the related software component, worth around $0.2m, was still expected to be recognised in the 2018 financial statements.
'Notwithstanding the issues concerning the North African order, the company's other business is progressing well, and the company expects continued growth in 2019,' Starcom said.
At 8:07am: (LON:STAR) Starcom PLC share price was -0.4p at 1.13p