Smart Technologies shares slump on weak forecast

Fri May 16, 2014 11:17am EDT
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May 16 (Reuters) - Shares of Smart Technologies Inc , which makes electronic whiteboards, fell as much as 34 percent on Friday after the company warned of a fall in full-year results, hurt by lower demand and higher investments.

Smart is investing in new technology to make products beyond its electronic whiteboards. However, the lower demand from education institutes and businesses would weigh on the company's results, RBC Capital Markets analyst Paul Treiber said.

"Constrained spending in education and unforeseen delays in enterprise deployments have reduced visibility, pushed out revenue growth and is a headwind to margins," Treiber wrote in a note to clients.

The company said on Thursday it expected adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to fall to $40-$50 million in fiscal 2015, from $74.5 million in the year ended March 31.

"Smart is facing headwinds in the early stages of a transition from an interactive whiteboard education company in decline, to a growing business with a broad product line and strong presence in both the education and enterprise markets," Chief Executive Neil Gaydon said in a statement.

The company's shares were trading down 29 percent at C$3.05 in late morning trading on the Toronto Stock Exchange. The stock hit a low of C$2.97 earlier. Smart's U.S.-listed shares were down 34 percent. (Reporting By Shubhankar Chakravorty in Bangalore; Editing by Savio D'Souza)