LONDON (dpa-AFX) - Software product group Micro Focus International plc (MCFUF.PK, MCRO.L) Monday announced weak revenues for first half, and a cut in its fiscal 2018 revenue forecast, citing that the rate of year-on-year revenue decline has been greater than anticipated since January.
In addition, the company announced that Chris Hsu has submitted his resignation in order to spend more time with his family and pursue another opportunity. He will step down immediately as the CEO of the company. Stephen Murdoch, currently Micro Focus COO, becomes CEO and rejoins the Board with immediate effect.
In its trading update, the company said it expects six-month revenues to decline on a constant currency basis at minus 9% to minus 12% compared with the proforma comparable prior period and DSOs to remain at a temporarily elevated level.
The company said it now expects constant currency revenue for the twelve months ending October 31 to be minus 6% to minus 9% compared to last year's proforma revenues. The company previously expected revenue of minus 2% to minus 4%.
The impact of this on adjusted EBITDA margin percentage for the period is expected to be mitigated by the progress made in the cost reduction programme which is currently tracking ahead of schedule.
At the midpoint of the revenue guidance range, the cost reductions will enable the company to achieve Adjusted EBITDA margin percentage of approximately 37% for the year,.
The Board expects for the Group's net debt position at October 31 to be broadly in line with market expectations.
The weakness in revenues was primarily due to lower than expected licence income and is a result of a number of factors, which management believe to be largely one-off transitional effects of the combination with HPE software, rather than underlying issues with the end market or the product portfolios.
Copyright RTT News/dpa-AFX