Integrated Research (ASX:IRI) share price jumps 5% on trading update

Better things to come for Integrated Research as it moves forward…

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The Integrated Research Limited (ASX: IRI) share price will be in investors sights this morning.

A trading update from the company regarding its FY21 second-half performance is the latest news from the provider of user experience and performance management solutions.

Prior to market open, the Integrated Research share price was sitting at $1.90. At the time of writing, the company’s shares are swapping hands at $2.02, up 5%.

For better and worse

According to the release, the company expects its second-half performance for FY21 to be significantly improved on the first half.

Integrated Research is anticipating second half revenue to fall between $40 million and $45 million. This would be higher than the $34.1 million in revenue reported during the front half of the financial year.

Likewise, profit after tax is expected to be somewhere in the ballpark of $4 million to $7 million, compared to $0.1 million in the first half.

However, it’s not all sunshine and rainbows for the company. While the updated revenue and earnings guidance is ahead of the first half, it remains lower than the prior corresponding period in FY20.

For that reason, despite the improvement in the last half of trading, Integrated Research reckons its full year performance will be down on the last year. On the top line, the range is $74.1 million to $79.1 million – compared to $110.9 million in FY20.

On the earnings side, the company is forecasting $4.1 million to $7.1 million – compared to $24.1 million in FY20.

Influencing the numbers

Integrated Research has experienced a few speed bumps recently that is slowing down the performance of its IT solutions business.

The uncertain environment created by COVID-19 has led to customers requiring shorter-term contracts, tight budget conditions and approval processes, and delays to purchasing decisions. These hurdles have stifled performance in recent trading.

However, on a positive note, the company stated, “License fee revenue recognised in 2H to date already exceeds 1H with June being the strongest revenue month for the company.”

Integrated Research share price recap

The last year has been a tough one for Integrated Research shareholders. After quickly rebounding out of its depressed COVID lull, the Integrated Research share price reversed again.

As of today, the Integrated Research share price is down 45% for the past 12 months. This compares to the S&P/ASX 200 Index (ASX: XJO), which has surged 23% during the same timeframe.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Integrated Research Limited. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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