Tuesday wasn’t the best of days to drop bad news on an already unsteady ASX, but payments group EML Payments had no option but to.
Dribbling it out over time could end up causing even greater problems for the company.
And so the update was released and EML shares nosedived after the company cut its June 30 full year guidance for 2022 by about 8% to a range of $52 million to $55 million and revealed a number of challenges in its European business.
The shares were down 33% at 11.30 am at $1.80, the lowest they have been since the dark days of the first Covid pandemic and lockdowns in the first quarter of 2020.
The company said while its North American and Australian businesses were performing in line with expectations, it was facing “operational execution issues in Europe.”
It added that “a more risk averse approach to new programs impacted the launch of new programs,” and it expected continued challenges throughout its fourth quarter.
The company also pointed to a deterioration in foreign exchange forecast rates, and spending on overheads being towards the higher end of expectations.