Pursuit shares in freefall after P&G fails to award it contract
PURSUIT Dynamics saw its shares nosedive yesterday after it announced that it had missed out on a key contract with consumer giant Procter & Gamble.
The loss-making technology company had pinned its hopes on P&G buying its technology – aimed at reducing costs for businesses.
Pursuit won extra funds from its shareholders in March. It said at the time that it was spending about £1m per month and that cash balances stood at £9.8m.
It was hoping to turn cash flow positive by September and deliver sales of at least £22m. Pursuit Dynamics said it now expected revenue for the year ending 30 September to be “materially below” its estimates.
The company has not reported a profit for at least the past five years, and posted a loss of £15.3m in the year to September 2011.
“The loss of Procter & Gamble today is a significant blow for them,” said Paul Kavanagh, chairman at Killick Capital.
“They’ve got a tough job in the next few weeks in establishing with their lead investors as to what the right route for the business going forward is and whether there is sufficient in the technology to push shareholder patience further.”