TechFinancials warns on profits as largest client leaves

7th Feb 2017 13:32

(ShareCast News) - Although it lifted profit guidance for last year, TechFinancials Inc has suspended its dividend as it warned that 2017 earnings would be hit as its largest software licensee Richfield Capital plans to leave.The AIM-listed company said it now expects to exceed market expectations with revenues of at least $21m and earnings before interest, tax, depreciation and amortisation not less than $2.8m.But management has been informed by its largest software licensee, Richfield Capital, owner of www.24option.com website, that it intends to end the current agreement with TechFinancials with effect from 1 April."The company is in discussions with Richfield in order to support the migration of trading activity to an in-house system during 2017, which may involve future services to be provided by the group."While first quarter profits are likely to be fine, management said it would "defer a decision on paying a dividend" as it was likely that the departure of Richfield will have an adverse impact for the rest of 2017's income and on EBITDA.