Aveva announces further cost cuts, expects to meet full-year guidance

10th Nov 2014 07:07

Engineering data and design IT systems provider Aveva saw revenues decline 21% over the six months ended 30 September to reach £85.9m. That was in line with the revised guidance provided by the company in its mid-September trading update. The company attributed the decline to the "material strengthening" of sterling.At constant exchange rates sales dropped 15% to £92.3m.The company reported mixed trading conditions by regions, with areas of strength such as in China, India and parts of Europe, Middle East and Africa, but weakness in South Korea and Brazil.Profit margins before tax dropped to 19.9% from 29.8%. Together with the decrease in sales the above saw profits before tax decline 48% to £14.2m.Neverthless, the company said it anticipated a result in line with the Board's current expectations for the full year.Management highlighted that it had entered into new multi-year deals with global accounts at improved prices, thanks in large part to its new AVEVA E3D plant design software. It therefore considers that there is now increased business visibility, with an incremental revenue opportunity of £30m going forward.Aveva also unveiled a new cost eficiency programme which it expects will deliver an additional £10m in savings in the second half.Cash at period end was 22% higher at £116.4m and the final dividend increased by 10% to 5.5p.