Patsystems slumps on profit warning

Patsystems slumps on profit warning

Shares in London-based Patsystems dived after the trading technology vendor warned of a profit shortfall in the first half of the year, which will not be recovered in H2.

Patsystems stock fell almost 30% to 19.25 pence in morning trading on the AIM after the vendor released a trading update saying existing and new customers are delaying expenditure on new technology projects due to the "disruption in the banking sector".

The vendor warned in April that major buying decisions by clients "are concluding more slowly than usual", but in today's statement the firm says sales it expected to conclude in the first half will slip to the second half, and a number of second half opportunities may be delayed until 2009.

"We now expect our profit for the first six months of 2008 to be lower than that reported in 2007 and we do not expect the profit shortfall in the first half of the year to be recovered in the second half of the financial year," says the statement.

But Patsystems maintains that a number of new sales are "close to completion" and that its sales pipeline for new business is "strong". The firm says it is confident of achieving sales targets for the second half of the year.

The vendor expects full year profit for 2008 to be at a similar level to the adjusted operating profit of £3.0 million reported in 2007.

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