Second profits alert posted by Tadpole
Tadpole Technology, a computer hardware and software company, yesterday issued its second profit warning this year but said it has enough cash for its "immediate purposes".
Bernard Hulme, the chief executive, said the company's £4m cash balance, including a £0.5m loan facility, might not seem like a huge amount but it had "managed on lesser numbers in the past".
"The company has been in tough situations in the past," he said. "The difference now is a few years ago Tadpole had run out of steam, it was in the wrong place. Now we have got some trading issues but I think we are in the right place. This business has got potential."
The house broker, Beeson Gregory, confirmed that full-year losses before exchange adjustments and goodwill amortisation are expected to widen from the £4.8m it had predicted to around £7m, on revenues down from £31.2m to around £23.5m. Mr Hulme said: "It is regrettable. We had predicted a loss but because hardware suffered due to the US slowdown the loss will be greater." But he said the hardware division was now focused in a growth area and on the software side, Tadpole's Endeavors technology looked promising.
Julian Tolley, an analyst from Williams de Broe, said he thought the company had enough cash to survive but was not out of the woods yet and was a "gamble for the longer term. We believe the key attraction of Tadpole Technology is Endeavors technology, which takes them to the forefront of peer to peer computing," he said. "But it will be a long struggle to profitability and with the technology sector in its current state it will be even longer." The shares fell 34 per cent to 10p yesterday.
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