Shares in AFA Systems have dropped 18% on warnings of sluggish sales by the AIM-listed provider of software to the banking and asset management industry.
Speaking at the company's AGM, Mike Hart, AFA chairman and chief executive says revenue from existing customers is in line with expectations, but cautions that the pace of recovery of larger sales to new customers is slower than anticipated.
"Sales enquiry levels and pipelines, including those for the higher value products such as Musketeer and some of our asset management products, continue to improve, but we are finding that lead times for these higher value orders are lengthy and decision making is time consuming," he says.
As a result, the group - which posted an operating loss of £3.1 million last year - is likely to incur further losses for the half year to 30 June 2004.
"Despite new customer sales being slow in the first half, the sales enquiry levels and order pipelines for the year as a whole should benefit revenues incrementally in the second half of the year," says Hart.
He adds that the firm is well-placed to take advantage of any market upturn, without the need to increase its cost base materially.
Shares in the vendor slipped 4.25 pence to 19.25 pence from an overnight close of 23.50.