Shares in Horizon Technology fell by over 14% today after the internet services company reported a pre-tax loss after exceptional items and said it would cut more jobs as part of a review of its overall cost base.
Horizon shares ended down 11 cents at 65 cents in Dublin.
Horizon had warned last May that its earnings would be hit by lower margins and announced job cuts. Today it said it had made a pre-tax loss of 16.5 million euro in the year to June 30 compared to a pre-tax profit of 11.4 million in 2000. The company said that the figure was hit by one-off restructuring costs and a goodwill write down.
Adjusted earnings per share fell to 9.7 cents from 15.35 cents the previous year. This was slightly higher than market forecasts after May's profit warning.
Horizon's revenues for the year to the end of June jumped by 38% and it said it was well positioned for growth despite difficult trading conditions. Revenues rose from 296.4 million euro in 2000 to 409.5 million euro, while underlying profit rose to 13.86 million euro from 13.62 million the previous year. Earnings per share rose by 5% to 17.5 cents.
The company said in its results statement, that the year to the end of June 2001 was made up of two different trading environments. During the first half, the company continued to perform in line with expectations. Midway though the second half of the year however, the company experienced a downturn as IT markets worldwide began to weaken.
Chief Executive Charles Garvey said the company had responded aggressively to changes in the market and carried out a comprehensive restructuring, including cutting 122 jobs from its workforce of 720. Another 60 lay-offs were planned, he added. Most of the cuts are taking place in Britain.
Looking ahead, Horizon Chairman Samir Naji said that despite the current difficult trading conditions, the group has moved rapidly and decisively to bring its cost structure into line with this new environment.
'The group has implemented very significant headcount reductions, has closed three offices through consolidation and has discontinued a number of loss making operations. In addition, the board has implemented further cost reductions during the first quarter of the current financial year. The board is confident that the group is well positioned to deliver good earnings going forward, even in difficult market conditions', he said.
