The shares' 16 per cent fall doesn't entirely reflect a fourfold increase in expected losses, suggesting the shares have bottomed. A new chief executive, Chris Stone, took the helm yesterday after John Klein abruptly departed. Mr Stone says MDIS's problems in the US, where it acquired companies it couldn't control, led to management taking its eye off the ball in UK. Fixing the problem is a matter of better management and focusing on fewer products, he says.
Interim results show the extent of the problem. UK sales rose 8 per cent but profits fell 17 per cent. In the US, the Glovia and Pro IV ERP businesses also widened both sales and losses. MDIS hopes to secure a deal with Fujitsu, its partner in the US operations, to scale down its stake.
Taking MDIS back to its pounds 260m flotation value will take time. Mr Stone sees it breaking even at the operating level in 2000, though exceptional restructuring charges could keep it in the red.
Still, MDIS has retained a decent customer base in a market growing at 20 per cent annually. The shares, at 19.25p, are now worth a punt.