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Inside Secure shares plunge as loss widens, plans staff cuts
March 7, 2013 / 12:26 PM / 5 years ago

Inside Secure shares plunge as loss widens, plans staff cuts

* Sales down 19 pct to $122 million in 2012

* Adjusted net loss of $30.3 million

* Company had floated shares a year ago

* Blames problems on main client Blackberry

* Shares drop 30 percent

PARIS, March 7 (Reuters) - French mobile chip company Inside Secure has abandoned its sales target and could cut about a fifth of its staff after a “disappointing” year in which its net loss doubled.

Shares in the company, which were floated on the stock market only a year ago, were down 28 percent at 2.19 euros by 12.16 GMT on Thursday, by far the biggest losers on France’s CAC mid and small index.

The shares had been issued at 8.30 euros apiece in an offering led by BNP Paribas and Natixis.

Inside Secure blamed its problems on “great upheavals” in its business environment, particularly the difficulties experienced by its main client BlackBerry , which has lost market share to smart phone rivals in recent years and recently delayed the launch of a new range.

Inside Secure dropped the target it set at its February 2012 flotation for consolidated sales of $400 million in 2014, saying it was now “obsolete”.

Its adjusted net loss widened to $30.3 million in 2012 from $14.6 million the year before.

“This bad news ... is leading us to refocus our business and adapt our organisation model and our cost structure,” Chief Executive Remy de Tonnac said in a release.

The company said the reorganisation might lead to a cut of around 20 percent of its global staff, which totalled 470 according to the company’s website, and will cost $7 million while targeting operating savings of $13 million per year.

“Honestly, there really is nothing good in this publication ... everyone is trying to get out as fast as possible of a stock that is increasingly causing concerns,” a Paris-based trader said.

In the French group’s main business of mobile near-field communication (NFC), sales fell 10 percent due to a drop in mobile phone sales by Blackberry and the postponement of its Blackberry 10 range, the company said. (Reporting by Alice Cannet and Alexandre Boksenbaum-Granier; Editing by David Holmes)

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