Equiniti shares slump as earnings set for bottom end of guidance
Equiniti, the British-based financial services business, saw it shares fall over 10 per cent this morning after it announced that its full year earnings would be towards the lower end of market expectations.
Read more: FTSE 100 rallies on trader optimism over US China deal
In a trading update, the company said earnings for the year were estimated at between £136m and £142m, due to weaker higher margin UK corporate activity.
The company also said that its expectations for revenue would be at the upper end of its guidance of £550m to £567m.
Shares initially slumped 22 per cent before creeping back. They remained 11 per cent down at 10:30 am.
Despite the change in guidance, Equiniti said that the company’s performance had been reassuring.
It said that client retention remained strong across the group, and that it had secure new customers across all of its divisions.
Equiniti’s investment solutions division has continued to take market share, with new wins including Marshall and Vitec Group.
Growth in the intelligence solutions business was driven by a combination of remediation services and software sales.
Read more: Dame Jayne Anne Gadhia’s fintech start-up Snoop gets watchdog approval
After completing the separation of the US division in the first half of 2019, the company added that there would be no more non-operating charges in the second half of the year.
In a statement the company said:
“Whilst we expect the uncertainty in the macro environment to continue, Equiniti remains well positioned.
“We expect further organic growth in the UK as we build on our relationships with our exceptional client base.
“The US offers a platform for accelerated growth based on market opportunity, the potential to take market share and the opportunity to cross-sell digitised services into our blue-chip client base.”
Main image credit: Getty