Seeing Machines scraps guidance as coronavirus hits transport sector

Seeing Machines shares fell heavily after the coronavirus pandemic forced the computer vision company to withdraw its guidance for the current financial year.

The AIM-traded company said government clampdowns on movement of people and goods to combat the COVID-19 virus were a big challenge to the transport sectors its products are designed for. Seeing Machines makes artificial intelligence-powered monitoring systems to improve transport safety.

Seeing Machines said the biggest impact would be at its fleet division. Though the company has enough stock of its Guardian accident prevention product to meet its annual connections target, customers are suffering business interruptions and are putting off capital spending. Along with potential supply chain problems these factors are reducing the number of vehicles for installations.

The company's contract manufacturer in China has restarted production but the amount of stock available for installations in the next financial year is not clear, the company said. Seeing Machines' automotive business is unlikely to take a big hit from the coronavirus and, though the disease has wreaked havoc on the airline industry, aviation is only a small part of the company's business, it said.

Seeing Machines' shares lost more than a quarter of their value in early trading and were down 15.4% to 1.65p at 08:18 GMT.

"As a consequence of the various factors outlined, the company believes it prudent to withdraw current guidance in respect of sales revenue, annualised recurring revenue and the number of connected Guardian units by 30 June 2020," the company said.

Seeing Machines said it was implementing contingency plans and cutting costs to preserve cash, which stood at A$47.3m (£23.7m) net on 31 December.