Oxford Metrics warned its profits this year would be “materially lower” than expected, wiping out about a fifth of the share price.
Smart Sensing Software, whose products are used to create the digital avatars of Abba Voyage, the virtual reality pop show, reported that its customers were more cautious in their purchasing decisions in the second half. This has resulted in “extended purchase cycles” in all of its markets. The sales pipeline has been pushed forward to the next financial period as a result.
The Oxford-based software company was founded in 1984 and has offices in California and Colorado, as well as Auckland. It claims to develop software that “enables the interface between real life and its virtual counterpart”. The company’s tools are used to create visual effects and measure movement in Hollywood films, video games, and the healthcare industry. Abba Voyage and Hollywood visual effects are both used by its software.
The motion-capture Vicon Technology from Oxford Metrics is used by thousands of businesses and institutions. These include Imperial College London, Boeing, Epic Games, and Lux Machina Consulting.
The company has been listed in London’s Aim junior stock exchange since 2001. Its performance in engineering, Vicon, and life sciences is expected to be slightly below the previous year. Meanwhile, its entertainment segment will be affected by the “ongoing slowdown of the global games industry, and the subsequent contraction in content creation”.
Oxford Metrics informed shareholders that they now expect to report revenues between £40 and £42 for the fiscal year ending September 30. This is lower than the £44.2 generated last year, and below the consensus estimate of £48.6 millions.
The management expects that the adjusted profit before taxes will be “substantially below” the current market expectation of £7.8million.
Investors sold the stock after the cut in guidance. The shares fell by 16 1/2p or 21 percent to 62 1/2p.
Deutsche Numis analysts said that despite “forecasting downgrades being disappointing”, the group’s IP, positioning on the market and opportunities remain unaffected. The group’s bosses claimed that despite the revenue delay it still has a strong financial position and a “healthy pipeline”.
Oxford Metrics said that with a net cash balance of approximately £50 million, it is able “to continue its active pursuit of M&A within the smart manufacturing sector to enhance our recently acquired Industrial Vision Systems (IVS).
Oxford Metrics purchased IVS in November last year for £8.1million. IVS is a specialist of developing machine vision software, and automated quality control system used across different sectors.
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