Shares in mobile phone company Getmobile Europe lost a third of their value yesterday after the company warned that profits would be hit by the postponement of the start-up of a key sales channel and tough conditions in the German market.
The company, which is chaired by entrepreneur Pierce Casey, said that it had closed the acquisition of three sales channels since its flotation in August, but the start-up of a further substantial channel had been indefinitely postponed.
Getmobile, an online and direct seller of post-paid mobile phone contracts in the German market, reached deals with ADAC, Germany's largest automobile club, as well as with German rail network Deutsche Bahn and Siemens, to offer its mobile phone contracts.
However, it failed to clinch a deal with German media company Axel Springer, which was postponed at a late stage due to Springer's planned takeover of Germany's biggest commercial television broadcaster, ProSiebenSat.1.
The company also blamed disruption in the German market following the recent entry of a number of mobile virtual network operators (MVNOs), which has created some consumer confusion.
"While Getmobile believes that the impact of these factors is likely to be short-lived, these factors will impact on sales for the period from acquisition to December 31st," the company said. The profit warning comes less than three months after the company took a dual listing on the Irish Enterprise Exchange and London's Alternative Investment Market (AIM) as Fitzwilliam Capital.
Shares in Getmobile, the name that it subsequently adopted after the acquisition of the German company of that name, lost 19 pence (€0.28) or nearly 32 per cent, to 41 pence on AIM yesterday.
In Dublin they closed 34 cent, or 38 per cent, lower at €0.55.
Company broker Davy has cut its earnings before interest and taxation forecast for the group this year to around €4.5 million from €6 million.
However, Getmobile said that it remained "highly profitable and cash generative".
The company, which has begun selling in the Dutch market and plans to expand into the French market in November, also expressed confidence that it will see renewed growth in the German market in 2006.
