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Micro Focus jumps as says new US$40mln licensing deal will help bolster first-half revenue

The FTSE 100-listed firm said that the earlier than expected signing of a new contract meant its first-half revenue would be better than the guidance it gave of minus 9% to minus 12% on a constant currency basis
Micro Focus office
Stripping out the impact of the new contract, Micro Focus said its underlying revenue was still towards the “better end” of that guidance range

Micro Focus International PLC (LON:MCRO) shares jumped higher on Wednesday after the software group, which issued a profit warning back in March, said a new US$40mln licensing deal will help bolster its first-half revenue.

In a pre-close season trading update, the FTSE 100-listed firm said that the earlier than expected signing of a new contract meant its first-half revenue would be better than the guidance it gave of minus 9% to minus 12% on a constant currency basis.

READ: Micro Focus spikes higher on report activist investor Elliott has built up stake

Stripping out the impact of the new contract, Micro Focus said its underlying revenue was still towards the “better end” of that guidance range For the full-year, the company reiterated its revenue and margin guidance.

Back in March, Micro Focus announced the departure of its chief executive as it cut its revenue outlook due to problems integrating assets acquired from Hewlett Packard Enterprise last year.

New chief executive Stephen Murdoch said in the latest statement that the group is “making encouraging progress on improving both the discipline and speed of execution within the business."

Micro Focus shares dropped 46% on the day of its profit warning in March but have rallied by over 25% since then.

In early morning trading. Micro Focus shares were up 8.5% to 1,377p.

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