Gentrack breaks silence on contracts
Gentrack says it was not aware of contract problems that prompted its profit downgrade last Friday until after the company had listed on the NZX.
The software firm last week attributed the lower profit forecast in part to a delay on "a major project" and to a delay in signing a substantial upgrade contract with a customer.
The company said it was in dispute with a customer over who should pay to complete the project, and it expected the dispute to go to mediation.
Spokesman Aaron Baker would not say on Monday whether the project was originally due to be completed before or after Gentrack's share offer closed on June 20.
After "media and third-party commentary", Gentrack said today that the likely financial impact of the delayed contracts was established "very shortly" before its revised forecast was released last Friday.
"The facts and circumstances that led the board to conclude that the FY14 forecasts should be revised down have arisen recently after Gentrack was listed on the NZX and ASX," chairman John Clifford said.
Gentrack said both delays involved "large utility customers" with whom the company had longstanding relationships, and it expected to do "significant additional work" with them.
In the case of the disputed payment, Gentrack said it was working with the customer towards a successful system implementation.
Despite the dispute, Gentrack "fully expects to have an ongoing long-term productive relationship with this customer".
Clifford said the Gentrack board "deeply regrets" that it had to revise its forecast downwards so soon after listing.
Shares in the Auckland-based developer of software for airports and energy and water companies, were down 4c or 1.8 per cent at $2.15 in afternoon trading.