April 15 (Bloomberg) -- Micro Focus International Plc plunged the most in two months in London trading after Chief Executive Officer Nigel Clifford quit “with immediate effect” after less than a year in charge.
The software company, based in Newbury, southern England, said in a statement today that it’s sticking with previous guidance for trading in the financial year ending April 30.
Two months ago, Micro Focus lowered its forecasts for sales and adjusted earnings, saying performance since the start of the fiscal second half had been disappointing.
“If you need to change the leadership, there is no point in waiting around,” Tintin Stormont, an analyst at Singer Capital Markets with a “buy” rating on the stock, said in a telephone interview. “You need to crack on and this is a company that needs to crack on.”
Micro Focus fell as much as 17 percent, and closed 7.8 percent down to 291.8 pence, the biggest decline since Feb. 15.
Clifford, a former chief executive officer of Symbian Ltd., which supplies the software platform for Nokia OYJ mobile phones, took over as CEO of Micro Focus last May 1. The company also appointed Mike Phillips as finance chief last year.
Chairman Kevin Loosemore is assuming an executive role, the company said in the statement.
“My immediate priority is to deliver the year-end in line with shareholder expectations,” Loosemore said in the statement.
Software companies generate revenue from licencing sales that customers tend to agree toward the end of the final quarter of the fiscal year, Stormont said. “This is a very critical number they have to hit and they know that,” she said.
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