Promethean revenues continue to shrink

Interim results for quarter to 31 March look disappointing

Turnover at interactive whiteboard vendor Promethean is accelerating its rate of shrinkage, as it posted revenue of £20.7m – 25.4 per cent lower in Q1 than in the same 2013 quarter.

That is 21 per cent lower when currency fluctuations are accounted for, according to the vendor's announcement to the London Stock Exchange on 8 May.

"Sales volumes of interactive display systems were 8.7 per cent lower than the prior period. The currency translation impact of a weaker US dollar has also adversely affected reported revenues and in addition, both lesson-content revenues and sales of other equipment, including LRS handsets, were lower than in the comparative period last year," Promethean admitted.

Last quarter saw turnover at the interactive whiteboard specialist reduce by 10 per cent.

Q1 of 2013 saw its revenue from lesson content boosted by its acquisition of interactive curriculum content resources from Houghton Mifflin Harcourt. The royalties from that will appear in results posted in Q3 of 2014, the manufacturer said.

But despite the increasing saturation of the IWB market in regions such as EMEA, the vendor remains positive about its prospects, especially as it works to diversify itself.

"[But] while market conditions remain challenging, we are seeing signs of increasing confidence from customers. Given the strength of our North American order book and our international region pipeline, our expectations for the first half and full year remain unchanged," it said.

"We continue to make good progress on the development and delivery of our software and hardware. Our widened range of hardware meets the needs for whole-class, small-group and individualised learning."

And the vendor will be "closely monitoring" the response to its new software and professional services.

"These products are proving to be an important differentiator for Promethean, although we do not expect them to generate material revenue this year," it said.

Outside the US, "a pipeline of significant tender opportunities" will present itself in the latter part of 2014, it added.

A US contract with Miami-Dade is expecting to see revenue follow through over time as well, as shipments will not be completed until the end of Q3.

The company's order book is fatter than it was in the year-ago quarter, insisted Promethean, with net cash up by £2m.