Micro Focus warns on full-year adjusted EBITDA

20th Feb 2014 08:07

Micro Focus International, the FTSE 250-listed software product group, on Thursday warned its full-year adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) would be 6.7m dollars lower year-on-year. It said the decline was the result of an adverse currency impact totalling $3.3m, as well as net amortisation of development costs in the year to date, which came to $1.5m compared to net capitalisation of development costs of $1.9m last year. Together these had a $4.8m impact on adjusted EBITDA for the year-to-date and a $6.7m impact year-on-year. The group also reported a decline in organic revenues in its Consultancy business for the three months ended January 31st, while Maintenance was flat and licence fees grew. Revenues from the acquisitions of Iona, Soforte, OpenFusion and AccuRev Inc. were in line with its expectations. For the full-year, revenues at constant currency are still expected to show growth of between 3% and 6% and that underlying adjusted EBITDA will be in line with current market expectations.The group also updated on the mis-statement of revenue, saying: "The investigation into the mis-statement of revenue caused by invalid orders within our sales channel network in India detailed in the interim results has been completed and concluded that no further adjustment to revenues is required. "Settlement has been reached with the partners from whom cash had been received directly or indirectly and the cash received has now been returned."Net debt at January 31st totalled $307.4m, up from $164.5m at October 31st following the completion of a return of cash to shareholders, several acquisitions, and the dividend payment. NR