ASX-listed technical consulting services provider, CPT Global (ASX:CGO), has posted a larger than expected net loss of $5.1 million.
The company had previously issued two profit warnings, in February and July, noting that it expected to post a $500,000 and $300,000 dollar net loss after tax in each half. That has now blown out to a full year loss of $5.1 million after tax, compared to a net profit after tax of $2.1 million in FY2014.
This follows a 27 per cent loss in revenue across the same period, which chairman Fred Grimwade attributed to struggles in Europe and North America.
"CPT Global's performance in the 2015 financial year fell well short of expectations recording an unacceptable loss. This was primarily as a result of the weaker performance of our international operations and in particular the European business which experienced lengthy delays in the commencement of a major new contract," he said in his chairman's statement.
He said the company is growing its IT service revenue in all regions, improving margins and costs. It has also signed up BMC Software and Compuware, which he believes will boost revenues in FY16.
Australian operations also suffered. Despite signing seven new clients, revenues and margins were down across all regions due to tough market conditions. Australian revenues were down 21 per cent on FY2014.
MD Gerry Tuddenham also blamed the Victorian election which saw several government projects 'shelved' until its conclusion. A significant contract remains on hold, he said.
As a result, the company will not be paying a dividend for the year. The company retains cash of $500,000 and net debt of $400,000.
Tuddenham said the company expects to return to profitability in FY2016, with boosts both locally and internationally.
At the time of writing, CPT Global's shareprice was $0.27, down from its pre GFC peak of $1.45 in 2008.
