Shares of Infocrossing (IFOX) were among technology's losers Monday, falling 26% after the company cut its second-quarter outlook and withdrew its 2005 guidance.
The technology services company now expects second-quarter earnings of $200,000, or 1 cent a share, on sales of $35.2 million. Previously, the company expected earnings of $2.4 million, or 11 cents a share, on sales of $37.5 million. Analysts polled by Thomson First Call had been expecting earnings of 11 cents a share on sales of $37.6 million. Infocrossing blamed the reduced second-quarter guidance on a shortfall of about $2.3 million in projected sales, $1.8 million of which was attributed to lower-than-anticipated usage-based billings and delays in the start of new contracts. In addition, the company added $1 million to its allowance for doubtful accounts for incremental usage-billing charges that were billed to a customer during prior periods. "We have established this allowance while we are negotiating vigorously to resolve this matter," the company said.
As for the withdrawal of its 2005 guidance, the company said that the uncertainty of new customer contracts has made it difficult to predict its results for the remainder of 2005. The company had been expecting earnings of $18.2 million to $18.8 million, or 72 cents to 74 cents a share, on sales of $167 million to $170 million. Shares were trading down $3.32 to $9.33.
Helix Technology (HELX) rose 14% after the company agreed to be acquired by Brooks Automation (BRKS - Get Report) for $454 million in stock. Helix shareholders will receive 1.11 shares of Brooks for each share of Helix they hold. The deal is expected to be accretive to earnings within the first year. After the deal closes -- during the fourth quarter of 2005 -- shareholders of Brooks will own 61% of the combined company, with Helix shareholders owning the rest. Shares were trading up $2 to $15.89.