Tuesday 9 July 2019 8:36 am

British IT firm Micro Focus ups profit margin but revenue stalls

Micro Focus saw revenue slip in the first half of its financial year, it said today, although earnings rose 1.8 per cent to $662.3m (£530.6m), boosted by a wider profit margin.

The figures

Adjusted revenue shrank 5.3 per cent year on year to $1.7bn (£1.3bn) in the six months to the end of April, the British IT company said, within guidance of a full-year drop of between four per cent and six per cent.

Revenue fell 7.5 per cent to $1.65bn on a statutory basis.

The drop in sales sent shares down almost two per cent in early morning trading to 2,056p.

However, adjusted earnings before tax, interest, depreciation and amortisation (Ebitda) climbed to $662.3m compared to the same period of 2018.

Micro Focus managed to derive more profit from its legacy software business in the first half of the year, rising 2.8 percentage points to 40 per cent on constant currency basis.

Adjusted net debt fell 12.2 per cent to $3.8bn while diluted earnings per share climbed 8.4 per cent to $0.86 per share.

What Micro Focus said

Chief executive Stephen Murdoch said: “We have made steady progress this half year, delivering against our financial and operational commitments and doing what the company does best: making, selling and supporting infrastructure software solutions that customers value and rely on.

“Micro Focus helps customers around the world to drive further returns from their existing investments while also taking advantage of new technologies and innovations to support their digital transformation.

“We have continued to make progress on our significant program of work to fully integrate the HPE Software business through the sustained application of the Micro Focus business model. As a result, we are pleased to reiterate full-year guidance.”

Main image credit: Getty