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04 October 2012 | Education | Promethean World plc

Promethean World Shares Drop 34% On Profits Warning

Promethean World reported revenues to September 30, 2012 of £123.2m, down 30.0% over the same period last year (2011: £175.9m) and now expects its full year results will be below current market expectations.

The Company says the trading environment in key markets during the third quarter continued to be challenging with third quarter revenues dropping by 41.2% to £40.0m versus the third quarter last year (Q3 2011: £68.0m). Demand during the key buying season in the US was lower than in recent years and was made worse by the delay in a large order, which the Company anticipates it will now receive in the fourth quarter.

As at 30 September 2012, Promethean reported a net cash position of £5.8m, down from £8.5m at the end of June. The Company has undrawn borrowing facilities and continues to anticipate a net cash balance at the year end.

The Company reports progress has been made on the cost reduction measures outlined in its interim announcement. It is now targeting cost reduction in 2013 at the higher end of the 20-25% range previously quoted. It expects operating costs for 2012 will be lower than previously expected with the full benefits being realised in 2013.

The Company also announced the first deliveries of ActivTable had been made during in Q3 2012 and initial customer feedback had been very positive. It also confirmed the rollout of its ActivProgress software to over 300,000 students in Mexico was ongoing and good progress had also been made on creating a Private Planet community for up to 100,000 Mexican teachers which the Company believes is early evidence vindicating its emerging software strategy. Promethean Planet continues to grow and now has over 1.45 million members, an increase of 33% over the last twelve months and in excess of 65,000 teaching resources.

The Company expects market conditions to remain difficult in 2013 but is aiming to remain an underlying profitable cash positive business.

 

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