MR warns of poorer than expected results

Click to follow
DELAYED orders would affect results for the year to 30 June, MR Data Management warned yesterday. Shares in the data processing and computer services group closed 33p lower at 144p.

Memex, a subsidiary that has developed text retrieval software for police forces and lawyers, had expected significant orders in Britain and the US before the year end. These included a pounds 360,000 order from Grampian Police.

John Redmond, group chairman, said part of the Grampian order had come in and he hoped Memex would receive the remainder this week. He said that the group had made a significant investment in Memex, and that a report by independent consultants backed its confidence in the prospects of the business.

Yesterday's trading statement also said reorganisation costs for the year would be higher than anticipated. In its interim results, MR Data Management reported reorganisation costs of pounds 382,000. It predicted the resulting annual savings would be pounds 710,000.

Mr Redmond said he had not realised at that stage how much reorganisation was needed at MR Data Graphics, a specialist scanning company bought from Taylor Woodrow in January 1993. The closure of one of the subsidiary's two locations was expected to create substantial cost savings.

'Because of the delay in receiving orders at Memex and the higher than expected reorganisation costs, MR Data's profit before taxation will not meet expectations for the year, although the second half will show an improvement over the first half,' the company said.

First-half profits were pounds 2.7m, down from pounds 4.0m in the first half of the previous year. Analysts had forecast full-year profits at pounds 9-10m.