London fintech firm Monitise issues profit warning as turnaround continues
The UK firm said that revenues for 2015 will be between £88-90 million. It had previously forecast sales of between £90-100 million, in its half year statement in January.
The company has endured a difficult year. In March it launched a 'strategic review' of its operations, briefly putting the firm up for sale, as well as replacing founder Alistair Lukies with new CEO Elizabeth Buse.
However, there was also evidence of progress towards business transformation goals, with costs during the second half of 2015 said to be significantly lower than the previous six months. It remains on track to meet its goal of a return to profitability by 2016, the company said.
It benefited from a recent joint venture with Santader, which involved a 'multi-million pound' upfront payment, and it is confident of having enough cash in the bank - currently £88.6 million - to see it through to an expected return to profitability.
The fintech firm has been struggling to complete a transformation of its business, after declaring last year that it would move to a subscription-based selling model.
Monitise has previously relied solely on providing bespoke mobile services for its clients, but recently announced that Socit Gnrale would be one of the early customers of its standardised cloud platform. This part of its business is expected to be a key driver of growth in future, it said. Previous Monitise customers include Lloyds Bank, Santander and Virgin Money.
Monitise CEO Elizabeth Buse said: "We have delivered a solid revenue performance in what has been a difficult year.
"Across the business, our cost disciplines have improved, we are taking the necessary tough decisions and our path to profitability is on track.
She added: "Central to our growth plans is our new API-based platform launched in April, we have been delighted with its technical capability and the reception it has received from clients, which gives us confidence for the future."
TechMarketView analysts Peter Roe commented: "Progress depends on the wide acceptance and high volume use of its standardised platform, broadening the revenue base across m-commerce.
"The platform was launched in April and has been well-received, capturing a major new US logo, but Monitise must ensure momentum in this increasingly competitive market."