Pebble Beach Systems (AIM:PEB) shares dropped in Tuesday’s early deals, as the media software business warned on profits and revealed it will go into cash conservation mode.
Spending on R&D for its PRIMA technology is to be scaled back “until such time as market demand warrants further investment” and the focus in the short term is on existing core capabilities as a broadcast solutions specialist.
It added that a ‘rebalancing’ of the business would create some £2 million of annualised cash savings, and, enable improved sustainable free cash inflows.
In Tuesday's trading update, the firm said it expected full-year revenue to be £11.5 million for 2024, down from £12.4 million a year before, while earnings (adjusted EDBITA) is expected at £3.3 million from £3.8 million in 2023.
“I have supreme confidence that PRIMA as an IP native product is perfectly positioned for when the market is ready to transition to IP technology,” non-executive chair John Varney said in a statement.
“Pebble's unique strength remains its long-standing position as a leading expert in delivering high-quality products and services within the broadcast industry."
In London, the share fell 21% to 7.66p in Tuesday morning’s trade.