Wynyard warns revenue may miss annual forecast as contracts lag, shares fall

Wynyard Group, the security software firm, warned annual revenue may come in lower than its forecast $29 million as negotiations with some of its larger customers lag. The shares fell.

The Auckland-based company said sales may fall below that range if larger contract negotiations extend into the new year, having previously flagged annual revenue to be between $29 million and $32 million. It also announced a new contract with a European-based justice agency, which will see $700,000 in software and services recognised in the 2014 year, with more than $1.4 million over the initial term.

“Wynyard currently has a number of large software licence agreements in the contracting phase with customers and new system integrator partners,” chief executive Craig Richardson said in a statement. “The company has previously highlighted this important transition to larger deals would result in lumpy revenue and contract execution timing risk as the company expanded into new markets and increased its government sector business.”

Wynyard, which was spun out of Jade Software, debuted on the NZX in July last year raising $65 million in capital to fund its international growth plans. The crime analytics and risk assessment software is in use by the London Metropolitan Police and the New Zealand and Australian police forces, global banks and corporations, and is making inroads into the huge US market.

In August, the company reported a first-half loss of $10.2 million compared to a loss of $3.1 million a year earlier, as it spent more on its expansion plans.

Shares of Wynyard fell 2 percent to $1.98 and have climbed 74 percent since the start of the year. The stock is rated an average of ‘hold’ based on the consensus of two analysts surveyed by Reuters, with a median price target of $2.33.

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