On Monday, shares of software development firm Crimson Tide fell by 15% in early trading hours, following the announcement that one of its clients is entering administration. The news has raised concerns about the company's performance in the second half of the year. Despite this, Crimson Tide's shares were valued at 1.85 pence each as of (03:16 ET) 07:16 GMT, down by 0.35 pence from the previous trading day.
The company reported a pretax loss of £471,000 ($576,551) for the first half of the year ending June 30, showing an improvement from the £860,000 loss recorded during the same period in the previous year. Crimson Tide's revenue also displayed a significant increase, rising by 31% to £3.0 million from £2.3 million.
Alongside this, annual recurring revenue grew by 35% to reach £5.9 million. The company's financial performance showed signs of improvement when measured using earnings before interest, taxes, depreciation, and amortization (EBITDA). It reported EBITDA earnings of £106,000, compared to a loss of £344,000 in the previous year.
Despite the client's administration crisis impacting its share price, Crimson Tide remains optimistic about its future prospects. The company expects its financial indicators to grow approximately 20% during the second half of the year.
Founder and Chairman Barrie Whipp highlighted that annual recurring revenue has seen significant growth and hinted at promising opportunities within their pipeline.
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