CS Holdings has warned that it will report a R15 million attributable loss and a headline loss of 6.5c a share for the year to 30 June.
The group warned previously that slower than expected third-quarter sales would affect earnings, but it expected at the time that it would be profitable for the year overall.
The main culprit behind the loss is the cancellation of the sale of the rights to a software product, which CS Holdings says will have a negative effect on earnings of about R10.5 million after tax.
The company says it remains entitled to the underlying revenue stream from the use of the product by its clients.
Other factors include impairment of certain assets and debtors, higher interest charges and a less than expected positive effect from new committed orders in the fourth quarter.
The results are expected to be announced early next month.
The group has issued a notice warning shareholders to exercise caution in their share dealings since the results are still in the process of being audited.
The CS Holdings share was trading at 50c on the JSE this morning, down 7c or 12% from yesterday`s close.
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CS Holdings warns of lower earnings
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