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Network Data issues profit warning ahead of results

Network Data Holdings has issued a profit warning to the stockmarket this morning ahead of its results due to be published on September 26.

This comes as the group also revealed it has reduced its staff numbers by 50 per cent since last September.

The group says it has been actively involved in reducing its cost base since last September and this program has been accelerated throughout 2008.

Despite these cost cuts, the group says the results for the full year to December 31st are likely to be below market expectations.

The group’s three subsidiaries, Network Data, Network Surveyors and Hipstar, are all reliant on the volume of transactions in the mortgage and property markets and have therefore found the first six months of 2008 to be a “challenging environment.”

Chairman Grenville Folwell says the group believes that the current conditions will favour then merger of networks. He says Network Data is currently evaluating acquisition opportunities that can be merged with its existing operation at very little cost.

Its says NSL managed to maintain its volume of business in quarter one, but the quarter two figures have reflected the lower transaction levels in the property market.

It admits that the operations of Hipstar have also been directly affected by the decline in property transactions.

Folwell adds: “Overall, while we expect 2008 to signal the bottom of our markets in terms of transaction levels, there are as yet no signs of recovery and the only rational course of action for the management of the group has been to cut our costs accordingly.”


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