Redcentric suspends share repurchase, unlikely to propose dividend
IT managed services outfit Redcentric said predicting future demand for its offerings was "difficult" due to the ongoing Covid-19 pandemic, leading the group to suspended its share repurchase programme and likely withhold any dividend payments.
Redcentric, which expects to have traded in line with expectations in its last full year, stated it was "highly unlikely" that it will recommend the payment of a final dividend for the recently wrapped up trading year.
However, on a slightly positive note, Redcentric actually witnessed a material increase in sales opportunities in March as a result of the pandemic.
The AIM-listed firm said the surge happened during the tail end of the month and meant that the volume of new recurring revenue contracts signed in March was materially above that seen in the past.
Looking forward, Redcentric cautioned that it looked set for a reduction in sales to new customers and a slowdown in major change projects from existing customers until the Covid-19 outbreak was brought under control.
Delayed customer receipts and increased business failures were also expected to weigh on revenues.
As of 1150 BST, Redcentric shares were up 6.60% at 105p.