Micro Focus shares crash as group warns over sales and boss resigns
Micro Focus sealed a £6.8 billion takeover of Hewlett Packard Enterprise’s software business in September.
Software group Micro Focus International has warned over sales and seen its chief executive resign, sending shares crashing 54% on the London Stock Exchange.
The FTSE 100 group said annual revenues were falling at a faster rate than previously expected after being confronted by lower licensing income.
Micro Focus, which sealed a £6.8 billion takeover of Hewlett Packard Enterprise’s software business in September, revised its annual revenue guidance to between minus 6% and minus 9%, compared with minus 2% and minus 4%.
The group also announced that chief executive Chris Hsu was quitting to “pursue another opportunity”, just six months after taking the role.
He will be replaced by chief operating office Stephen Murdoch, who will take up the position immediately.
Executive chairman Kevin Loosemore said: “We remain confident in Micro Focus’ strategy whilst recognising that operational issues have led to a disappointing short-term performance and outlook.”
Micro Focus said its sales teams had taken a hit as it grapples with the introduction of a new IT system, while former customer accounts of Hewlett Packard Enterprise were disrupted by its merger with the firm’s software arm.
However, it said its cost savings drive was ahead of schedule and net debt was expected to be in line with expectations.
Shares in Micro Focus have fallen more than 64% since the start of the year when the firm warned that its half-year results would miss expectations.
The group has already taken steps to shore up its fortunes by recruiting ex ARM Holdings and easyJet executive Chris Kennedy joining as chief financial officer.