AIT, a supplier of customer relationship management software to the banking sector, is reporting a 51% drop in turnover for the year ending 31 March 2003, and operating losses of £16.7 million.
The company has endured a turbulent year after running into a severe liquidity crisis and issuing a shock profits warning in May 2002 that sent its shares into freefall.
AIT says the general downturn in the worldwide CRM software market was exacerbated by the financial uncertainty surrounding the group, impairing its ability to secure new contracts. This was manifested by the reduction in licence sales and related revenues during the year which fell to £8.4 million from £13.0 million in 2002, and professional services revenue which fell to £9.2 million from £23.2 million in 2002.
Pre-tax losses for 2003 rose to £41.2 million compared to a loss before tax of £9.3 million in 2002.
The new management installed at AIT says phase one of the planned turnaround in the company's fortunes has been completed, with financial stability restored and operating costs slashed from approximately £44 million per annum to £19 million, in line with core business levels. This has been achieved by a 66% reduction in headcount to 174 and the closure of six offices. The company secured £20.5m of new equity last year and a further £5m following the issue of a convertible loan note this month.
The next stage of the plan calls for a return to profitability within the current financial year.
CEO Nick Randall says: "I am encouraged by the progress achieved to date and the visibility of revenues that we are achieving in the software support and services areas. The year has started out well in terms of new licence wins and the prospects are continuing to build."
AIT customers include Alliance & Leicester, Bradford & Bingley, Britannic Money, First Data Europe, Lloyds TSB, Marks & Spencer Financial Services, Nationwide, NatWest, The Woolwich, Komercni Banka (Czech Republic), KeyCorp & Rainier Pacific Bank in the US and Benkar Advantage in Turkey.
The company has also recorded a new client win outside the financial sector, securing a deal for a contact handling system for a leading UK police force.