Software heavyweight Aveva reveals drop in sales due to foreign exchange shifts and delayed contracts
Industrial software giant Aveva Group has said it predicts foreign exchange headwinds and the slippage of contracts to cause first-half revenues to be significantly lower.
The Cambridge-based company believes revenues will end up at around £333million in the six months to the end of September against £391million in the same period last year.
Shares fell 5.3 per cent to £45.23 after it revealed results were affected by two medium-sized subscription deals that were expected in the second quarter now sliding into the third quarter and harmful foreign exchange headwinds.
But Aveva still said that it managed to perform ‘creditably’ and has not altered its outlook for the 2021 financial year.
It wrote: ‘Notwithstanding Covid-19 related disruption, there has been solid demand for AVEVA’s software due to its ability to drive efficiency, flexibility and sustainability for customers across a wide range of industries.’
Orders and revenue growth for the remainder of the year are expected to be strong though thanks to contract slippage, as well as a higher level of renewed contracts, including large-scale global accounts.
In a separate announcement, the FTSE 100 firm revealed it had completed the syndication of a £250million revolving credit facility concerning its planned purchase of OSIsoft with numerous banks such as HSBC and J.P. Morgan.
Another $900million loan that was due to be provided by the banks will instead come straight from Schneider Electric, which controls around 60 per cent