Shares in Financial Objects dived in morning trading after the UK vendor warned that its financial performance in the first half of 2008 will be "significantly behind" that recorded in the same period last year.
After closing at 46.50 pence on Wednesday, Financial Objects stock fell to a 52-week low of 32.50 pence in Thursday morning trading on the back of the profit warning. The stock had recovered slightly by mid-morning but was still trading down 22.50%, or 10.5 pence, at 36.50 pence.
In a statement prepared for the vendor's annual general meeting, company chairman Paul Fullagar says despite a strong "pipeline of opportunities", the firm's financial performance for the full year is "dependent on closing one or two significant licence deals to make up for the lower than expected performance in the first half".
Financial Objects said in March that sales at its banking systems unit were down 17% in 2007. The vendor appointed John McKee as divisional director of its banking division last October and also moved to expand the sales team at the unit in a bid to increase revenue.
The firm also said it would grow its sales team at its wealth managment unit and would embark on direct sales campaigns with the banking team to cross sell software into the banking market, but the impact of these changes would not be fully felt until the second half of 200.
In today's statement Financial Objects says it has taken "longer than anticipated" to bring the sales force headcount up to planned levels and as a result, its first half result will fall short of that recorded last year.