August 7, 2018 / 1:24 AM / a year ago

UPDATE 1-Australia's Eclipx Group plunges 42 pct after profit guidance cut

(Updates with share movement)

Aug 7 (Reuters) - Shares in sales financing firm Eclipx Group Ltd plunged 42 percent on Tuesday after the company cut its full-year profit guidance, hurt by sluggish auction activity at its online brand GraysOnline.

The company said late on Monday it now expected to report fiscal year 2018 net profit after tax and amortisation (NPATA) in the range of A$77 million ($56.9 million) to A$80 million.

That represented growth of about 13 percent to 17 percent on the previous year, compared with the previous forecast of about 27 percent to 30 percent growth.

“GraysOnline auction activity is being affected both by a 10-year low in bank-initiated insolvencies in Australia and the current buoyant construction sector,” the company said in a statement.

Eclipx expects GraysOnline to report a 30 percent to 40 percent NPATA increase on its pre-acquisition full-year NPATA of about A$8 million.

The company also said accident management services brand Right2Drive’s result would miss previous expectations due to tougher competition.

Eclipx shares were down 41.9 percent at A$1.77 at 0119 GMT, compared with a 0.2 percent fall in the broader market.

The Sydney-based company expects to release its full-year results in early November.

$1 = 1.3545 Australian dollars Reporting by Aditya Soni in Bengaluru; Editing by Stephen Coates

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