K3 Business Technology Group PLC (LON:KBT) shares were on the slide on Tuesday after the group said Brexit-related disruption meant revenues in its current year would be more second-half weighted than usual.
In an update for the six months ended 31 May, the AIM-listed software group said the ongoing UK exit process from the EU had prolonged decision-making process among its customers, which had consequently affected their services activity and pushed the potential earnings further back in the year.
However, despite the rebalancing K3 said it remained on track to meet current market expectations for the full year and had closed a number of major deals at the end of its first half, while the ongoing pipeline looked “very healthy”.
The company also said its focus on cash generation was continuing, with its net debt in the six months having fallen 32% year-on-year to £5.8mln, with the trend expected to continue.
K3 said it will deliver its first half results and a trading update on 9 July.
In a note to clients, analysts at K3’s ‘house’ broker finnCap reiterated a 290p target price on the stock, saying the reduction in the company’s net debt over the first half demonstrated “ongoing progress against the strategic transformation of the business”.
K3 shares were down 2.7% at 214p in early deals.