FTSE 100 has listed IT company Aveva (LON:AVV) and saw the stock slide on Monday morning.
The company said it was “widely inline” with the group’s plans, with the exception of Forex-related headwinds and two medium-sized subscription transactions from the second to third to second quarter, saying it is expected to close revenues at £333 million for the first half.
One of these agreements was the renewal of “significant” global accounts. Unadjusted revenue fell 12% in H1 2020 as revenue from this agreement was drawn in September 2019. Earnings fell 7% in the first half, taking into account contract renewals.
Speaking of its availability and confidence in the future, Aveva’s statement said, “Despite Covid-19-related disruption, there has been a robust demand for Aveva’s software due to its ability to promote efficiency, flexibility and sustainability for its customers across a wide range of industries. Aveva performed credibly against this background in the first half, and its outlook for the whole year remains unchanged.”
“The remaining order pipeline for the fiscal year is backed by a large number of contract renewals, including large global account agreements, as well as contracts that have been slipped since the second quarter. As a result, the board is hoping for solid revenue growth in the second half and is confident in its full-year outlook.”
After the update, Aveva will share 4.79% or 227.00p slides to 4,499.00p 21/10/20 11:45 GMT. This is more than 6% above the consensus target price of 4,209p, but is well below 5,290p since the start of the year.
The company currently has a consensus “hold” rating and has a “low-performance” stance of 63.49% from the market beat community. Its P/E ratio is 43.57, below IT, with a technical average of 65.37.
