SLI Systems shares drop to new low
SLI Systems shares dropped 4 percent, taking the stock to a new record low, as investors remain cool on the prospects for companies chasing rapid growth in foreign markets.
The shares fell 2 cents to 48 cents, and have slumped 44 percent since the e-commerce software seller reported a narrower annual loss in August as it overhauled its business in the wake of losing three major customers.
SLI has hired a new chief executive and appointed three other senior managers to address the decline in revenue with a view to getting the company back on track in the current financial year.
"With a new chief executive and changing a few things, that might take a bit more time to gain more direction for that company," said Grant Williamson, a director at Hamilton Hindin Greene in Christchurch.
"They lost a big customer or two as well, so investors are marking it down, but when you look at the volumes there's not much there."
SLI narrowed its annual loss to $162,000 for the year to June 30, from a $7.55 million loss in the previous year, and while revenue was up 25 percent to $35m, annualised recurring revenues - a key metric for software-as-a-service firms - fell to $31.2m from $34.6m as a result of the lost customers and the strength of the kiwi dollar.
Williamson said SLI was one of a number of companies seeking to rapidly growth the business at the expense of short-term profits that had fallen out of favour with investors in recent times, name-checking intelligence software developer Wynyard Group, whose shares have plunged to 18.5 cents from the $1.15 price in the 2013 initial public offering.