Feeds

UK IT firms make fewer profit warnings

Realism, not recovery

  • alert
  • submit to reddit

Gartner critical capabilities for enterprise endpoint backup

ComputerWire: IT Industry Intelligence

UK Software and computer service companies made far fewer profit warnings in the last three months of 2002, according to a study by accountants Ernst & Young. It said this suggests that companies' forecasting may increasingly be coming into line with "the external reality rather than internal aspirations."

Ernst & Young said there were only 12 warnings issued by 169 listed companies in the sector in the last quarter of 2002, compared to 16 in the previous three months, and 19 a year earlier. This meant that software and services was no longer the sector issuing the highest number of warnings.

Warnings also had a less dramatic impact on share prices than in earlier periods. In the third quarter, profit warnings led to an average 32% fall in the share price of software and service companies compared to 23% for the market as a whole. By the fourth quarter, profit warnings produced an average share price fall of 24.25%, in line with the drop of 24.03% for the market as a whole.

Nick Powell, a partner in Ernst & Young's technology, communications and entertainment practice, said that further restructuring of the sector is inevitable. With delays to contracts and negotiations still being cited as the most common reason for warnings in the fourth quarter, followed by difficult market and trading conditions, he said that it is clear that corporate IT spending remains tight.

© ComputerWire

The essential guide to IT transformation

More from The Register

next story
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Premier League wants to PURGE ALL FOOTIE GIFs from social media
Not paying Murdoch? You're gonna get a right LEGALLING - thanks to automated software
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Ballmer quits Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Online tat bazaar eBay coughs to YET ANOTHER outage
Web-based flea market struck dumb by size and scale of fail
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
US regulators OK sale of IBM's x86 server biz to Lenovo
Now all that remains is for gov't offices to ban the boxes
prev story

Whitepapers

5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.