 have plunged following warnings of a sharper than expected fall in revenues and resignation of the chief executive. ){kind=link}
Shares in Micro Focus (LON: MCRO) have plunged following warnings of a sharper than expected fall in revenues and resignation of the chief executive.
Share in the UK’s biggest technology firm plummeted 46 percent to £10.11, with the firm losing almost half of its market value.
“We remain confident in Micro Focus’ strategy whilst recognising that operational issues have led to a disappointing short-term performance and outlook,” said the executive chairman, Kevin Loosemore.
“We believe that Micro Focus is well positioned to help our customers with the increasing pace of change across their Hybrid IT environments and to deliver customer centred innovation,” he added.
The chief executive, Chris Hsu, announced his resignation and said he was leaving “in order to spend more time with his family and pursue another opportunity”. He is to be replaced by the chief operating officer, Stephen Murdoch.
Performance for the group is not looking promising and they are expecting sales to fall between six and nine percent in the year to 31 October. This is compared the two – four percent in the year previously.
Russ Mould, an investment director at AJ Bell, said: “Micro Focus’s deal to buy HPE’s software business was huge and very complicated, not least because both firms had already done a lot of deals.
“Investors need to be wary of firms which make multiple acquisitions, especially if they are big and seen, or described, as transformational as the scope for something going wrong is considerable – as shareholders in Marconi, Royal Bank of Scotland or more recently Carillion will attest.”
Micro Focus is a multi-national software and information technology company and was founded back in 1976. A statement by the FTSE 100 listed company said that their cost savings drive is ahead of schedule and the net debt will be in line with expectations.