InterX future in the air after 73% slump
The future of the West London-based software company InterX was up in the air last night after it issued a devastating warning which knocked 73 per cent off its share price.
Worryingly, the company confessed that potential customers were increasingly buying the sort of software it sells from the major players in the industry instead.
InterX blamed yesterday's warning on customers delaying making decisions to buy its software. Its results for the year to end June are now expected to be "substantially" below market expectations.
Shares in InterX closed down 49.5p at 18p yesterday. Two years ago, at the peak of the internet boom, the stock had hit almost £40.
"Its options are really threefold. It could licence its software to one of the larger players or it could sell the [software] business or the intellectual property rights. If it's unable to do either of those things, they could close the business," said one banking source.
The company, which has about 100 staff, is expected to indicate which strategy it might follow next Tuesday when it publishes its half-year results.
It will also detail then whether it stands any chance of recovering any of the cash it lent to Diligenti, a company in which it has a 34 per cent stake.
InterX said Diligenti could not pay off the £16.4m loan, or the £1.6m of interest due, because it had failed to get its own fund raising off the ground.
At the end of December, InterX had just £6.2m of cash left and was burning about £1m a month – implying it has just half a year's cash.
ING Barings, its broker, was forecasting the company to turn out a pre-tax loss, before goodwill amortisation, of £14.6m for the current year on sales of £5m.
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies