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UPDATE 2-Software firm Kewill warns on profit; shares fall
April 5, 2012 / 7:39 AM / 6 years ago

UPDATE 2-Software firm Kewill warns on profit; shares fall

* Sees FY rev, adj operating profit below market estimates

* Says hurt by tough conditions across its markets

By Karen Rebelo

April 5 (Reuters) - British software firm Kewill Plc said it could not complete two large contracts it had planned to secure in fiscal 2012 and warned that revenue and profit would remain flat.

“These deals would have accounted for about 4.4 percent of sales,” Charles Stanley Securities analyst Peter McNally said.

In January Kewill, which provides software to freight forwarders, distribution firms and express parcel groups, said it hoped to complete three large contracts and was confident of meeting its full-year expectations.

The company, whose clients include FedEx Corp, DHL and UPS, said it expected to report revenue and adjusted operating profit below market estimates due to longer sales cycles and tough economic conditions across its markets.

Analysts on average were expecting revenue of 61 million pounds and operating profit of 10 million pounds, according to Thomson Reuters I/B/E/S/.

The company posted revenue of 60 million pounds ($95.2 million) and adjusted operating profit 9.6 million pounds for the previous fiscal year.

Kewill also said it signed a large licence contract in its logistics business in the fourth quarter, which had made a significant contribution to the full year results.

“A late deal in Reverse Logistics (business) appears to have saved Kewill from a very large forecast miss, ”said Peel Hunt analyst Paul Morland.

Shares of the Surrey, England-based company were trading down 4 percent at 70 pence at 1045 GMT on the London Stock Exchange. It fell as much as 11 percent earlier on Thursday.

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