FRANKFURT (Reuters) - German financial software group GFT Technologies (GFTG.DE) issued its second profit warning this year after Deutsche Bank (DBKGn.DE) and Barclays (BARC.L) cut spending on its products by almost a quarter, sending its shares down sharply on Monday.
Deutsche Bank and Barclays are restructuring their investment banks after a series of bets that went wrong in the wake of the financial crisis left them struggling to compete with Wall Street rivals.
"The temporary decrease in revenue with our two major customers is currently unavoidable due to the realignment of these financial institutions," said GFT, which helps banks to implement regulatory requirements and digitize processes.
A spokeswoman said the banks in question were the same two it had blamed for its last warning in March. Revenue from other customers is expected to grow by 13 percent this year, GFT added.
"Since the realignment of the two major customers is expected to extend into 2018 and GFT is assuming that the revenue with these two financial institutions will not pick up again until 2019, management has also adjusted the medium-term forecast," GFT added.
The company pushed back to 2022 from 2020 its targets for revenue of 800 million euros ($910.7 million) and a core profit margin of 12 percent.
GFT shares dropped to a two-year low and by 1145 GMT were down 10.7 percent at 16.40 euros.
The Stuttgart-based group said it now expects 2017 core earnings of 42 million euros, down from a previous forecast of 48 million euros and last year's 47 million euros. Full-year revenue is expected to be flat at 425 million euros, against previous guidance of 450 million euros.
GFT said that social security contributions in Brazil, restructuring costs and currency fluctuations would also weigh on this year's profit.
Reporting by Georgina Prodhan; Editing by David Goodman