By Alex MacDonald
LONDON--Location-technology and tracking group Ubisense Group
PLC (UBI.LN) reported a wider net loss in the first half of the
year on Monday, with earnings hit hard by flagging sales as it
switches focus to supplying higher-value software programs and
exits lower-margin consulting services.
The U.K.-listed company reported a net loss of GBP7.33 million
($11.4 million) in the six months to end-June compared with a net
loss of GBP2.12 million in the same period a year before. This
included GBP1.9 million in non-recurring costs related to its
restructuring plans.
Revenue fell 40% to GBP10.4 million in the first half of the
year compared with the same period a year before.
The company has exited its consulting services business in
Europe and stopped investing in its unprofitable businesses in
South Korea and Philippines to focus on its two core divisions:
real-time location systems and geospatial systems.
Ubisense is eliminating jobs, with its headcount set to fall to
190 by the end of the year from 200 in June end and 250 at the end
of last year. This should reduce its operating costs by GBP2
million annually, the company said.
"The results for the first half are clearly disappointing. We
have continued to execute our shift to software solutions, by
exiting the consulting services business in Europe which combined
with customer order slippage resulted in a significant revenue
decrease in the first half," said Ubisense Chief Executive Richard
Green.
Mr. Green said he expects the second half of the year to be
better than the first half as the company benefits from cost
reductions and recoups software sales that slipped in the first
half of the year.
"Having made the investment in our two business lines and
developed next generation products over the past 3 years, whilst
building up a blue-chip customer base, the group is now better
positioned to scale with its strategic partner channels such as
Atlas Copco," said Mr. Green. Atlas Copco is a Swedish
industrial-equipment supplier.
The U.K. company said it had cash and cash equivalents of GBP7.8
million at June 30 and net funds of GBP2.5 million.
-Write to Alex MacDonald at alex.macdonald@wsj.com
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