Redstone chops profit forecast

Review of annual accounts leads VAR to slash adjusted EBITDA forecast to between £5m and £6m

Redstone said it is exploring ways to further reduce debt

VAR Redstone has slashed its full-year adjusted profit forecast and revealed it is in talks regarding a loan facility held by its Symphony Telecom subsidiary.

The firm, which recently sold its telecoms unit to Daisy Group for £17m, now expects adjusted EBITDA for the year ended 31 March 2009 to be between £5m to £6m.

The revision, which is significantly below its previous forecast of £7.5m to £8m, follows a review of its annual accounts with its auditors.

In a stock exchange announcement this morning, Redstone said it is also exploring ways to reduce its debt further, including asset disposals, cost reduction and raising new funds.

As part of that, Redstone is in talks with Eckho Technologies regarding the loan facility it has with its subsidiary Symphony Telecom (Eckho was Symphony’s former owner). Some £1m of the outstanding £2.7m loan was due to be paid on 28 August and although Redstone opened the discussions before that date, a successful outcome is yet to be reached.