Worse-than-expected first-quarter results, with a 41 per cent slide in year-on-year revenue to $10.1 million (€10.8 million), hit Trintech shares which fell 35 cents to close at €1.65 on the German Neuer market.
On Nasdaq, the ADRs, bolstered this week through a reverse split to prevent delisting, dipped below their recent 52-week low in early trading, falling 13 per cent to $1.65. By the close on Nasdaq, the shares had reached $1.55, down 18.42 per cent.
The security software company reported a pro forma or cash loss of $4.5 million for the quarter, in line with Trintech's pre-results profits warning but higher than most forecasts. The cash loss was up from $2.5 million in the preceding quarter. But the reported net consolidated loss for the quarter was $11.5 million when restructuring charges for staff reductions and once-off write-downs are included.
Trintech shares are now just a fraction of the €75.25 reached at the height of the dotcom boom in early 2000 while the market capitalisation of the company once valued at €4.6 billion is now just €52.5 million.
Chairman and chief executive Mr Cyril McGuire said the IT spending environment remained soft over the quarter when his main priority was to take "the necessary actions to stabilise the business, accelerate our turnaround plan and right size the company for future profitable growth". Having brought costs down and anticipating a further 10 per cent reduction in the current quarter, Mr McGuire said Trintech had turned the corner.
He was determined to increase revenue but would only take on profitable business, he said, adding he was optimistic of a good recovery in the second half. Cash operating costs were down 14 per cent on the previous quarter while cash usage for the quarter was $7.1 million and the company ended the quarter with cash and near cash balances of $53 million.
Davy analyst Mr Paul Phelan said he expected to reduce his top and bottom line forecasts for this year and next year following the latest results. ABN Amro analyst Ms Jemma Houlihan commented: "There is nothing in these numbers to change our stance on the stock - there is no sign that the business is near stabilising while takeover predators are steering well clear."
Trintech shares were not particularly cheap for a company losing $4 million per quarter, she added.
Revenue in the quarter to end-April was affected by difficult market conditions and slower-than-anticipated new product launches, the company said. First-quarter revenue was down 35 per cent on the preceeding quarter.
Within the total revenue figure, product revenue was 70 per cent lower at $1.8 million on the previous first quarter and 73 per cent down on the preceeding quarter.
The fall was attributed by the company to a general weakness in its point-of-sale business line, particularly in the German market.
Software licence revenue at $5.2 million was 31 per cent lower than the pervious first quarter and 14 per cent down on the preceeding quarter. Trintech said this fall reflected softness in the global information technology market. Service revenue was flat at $3.1 million on a year-on-year basis but up 19 per cent on the three months to end-January.
