Seeing Machines Limited (LON:SEE) says it is implementing several contingency plans and cost containment initiatives which it says leave it in “a strong position” to mitigate the impact of the coronavirus outbreak on its business.
The AIM-listed firm, which develops driver monitoring technology, said that while the short to medium-term outlook was “uncertain” and that it may be impacted by current market conditions, there was “positive momentum” across all transport sectors and the company had “significant confirmed order books for both its fleet and automotive divisions".
READ: Seeing Machines reports double-digit revenue growth in first half
Seeing Machines said it was likely that its automotive business will see “no material impact” as a result of the outbreak, and while its fleet division was predicted to experience an impact on installations of its Guardian driver monitoring system, the firm still expected the segment to achieve “significant growth year-on-year”.
For the aviation business, Seeing Machines said there had been “a significant impact” on airline operators as a result of the outbreak, however, the division only represented a small proportion of the company’s 2020 revenue forecast and was not expected to have “any material impact” on the segment in the near term.
However, as a result of these factors, Seeing Machines said it will withdraw its current guidance in respect of sales revenue, annualised recurring revenue and the number of connected Guardian units by 30 June.
The firm added that its contingency plans alongside its previously announced net cash balance of A$47.3mln as at 31 December will maximise its cash runway.
“These measures leave Seeing Machines in a strong position and aim to ensure its ability to finance ongoing operations”, the company said.
The shares were down 14.1% at 1.7p in early deals on Tuesday.