The Integrated Research Limited (ASX: IRI) share price is dropping lower on Friday morning.
At the time of writing, the user experience and performance management solutions provider's shares are down 2.5% to $2.42
Why is the Integrated Research share price dropping lower?
Investors have been selling the company's shares this morning following the release of an update on its guidance for the first half of FY 2021.
At the end of December, the Integrated Research share price crashed lower after it revealed that its trading performance had been below expectations due to a continuation of customers deferring purchasing decisions.
In light of this, it provided guidance for half year revenue in the range of $34 million to $37 million and profit after tax in the range of breakeven to $2 million. This compared to revenue of $53.2 million and profit of $11.8 million in the prior corresponding period.
This morning the company advised that it is in the early stages of preparing its interim financial results. Based on internal management accounts and subject to audit review, it anticipates both revenue and profit after tax to be at the lower end of its guidance range.
It notes that the AUD/USD exchange rate strengthened by another cent on the last day of the year, resulting in further unrealised exchange losses.
This means that Integrated Research is expecting revenue of ~$34 million and no profits for the half. This represents a 36% and 100% decline, respectively, on the prior corresponding period.
At the end of December, the company's cash balance (net of debt) stood at $1.7 million. This is down from $4.7 million at the end of June.
New product launch.
Management also advised that the company has expanded its Collaborate product line with the release of new cloud solutions for Microsoft Teams and Zoom.
A further update on its cloud-based solutions will be provided at the formal half year results announcement scheduled for 18 February 2021.
