Egg scales back international ambitions as French show resistance
24 April 2003 | 3702 views | 0
Internet bank Egg is to spend an additional EUR140 million on its French business after admitting that its first product, a credit card, got off to a sluggish start.
Egg has set back the break-even date for its French adventure by a year to 2005 and signalled that it will hold off on further overseas expansion.
The news is a setback to the UK direct bank, which has been bullish about its expansion into the French markets, and had commissioned market research into the possibility of establishing a foothold in North America.
Chief executive Paul Gratton says: "La Carte Egg, which we recently launched, has taken off more slowly than we had hoped for, but having achieved high levels of brand awareness we remain confident about Egg France's long-term prospects."
The revision in forecasts came as the company reported a first-quarter loss of £15.7 million, and forced a 9.5 percent mark-down in Egg's share price to 92.5 pence.
The bank's UK business remained solid, reporting £17.3 million of first-quarter operating profit.