Iona Technologies' share price appeared to have settled somewhat in trading yesterday, as the Irish software company released positive news about one of its software contracts. Last week, Iona lost half its share value when it warned investors it would not meet expectations for its first-quarter sales and profits.
Despite a comparatively large volume of trades of Iona stock, the company's share price fell slightly to finish down $0.125 at $14.125 (€13.11). Just weeks ago, Iona shares were changing hands at more than $50 each.
Last Thursday, the company said its net first-quarter profits would be "below the company's expectations . . . between a loss of three cents per share and breakeven". This compares with a net income of 10 cents a share for the first three months of 1998.
The company said it had failed to close several large sales contracts and had run up exceptionally high expenses due to aggressive hiring and product development.
On the Dublin and Nasdaq stock markets, investors reacted quickly, ditching shares. But most analysts said that while the news would damage Iona, it was unlikely to decimate the share price in a manner similar to that of the other leading Irish software company on the Nasdaq, CBT.
Some pointed to a broader base of investors, pointing out that 50 per cent of Iona is owned by its staff and a further 25 per cent controlled in Europe. CBT, which saw its share price drop from over $60 to around $6 last year, had more US-based "momentum investors" who dropped the stock at the first sign of trouble.
On Monday, Iona said the US National Quotation Bureau had chosen its products to help run the the Over The Counter service it provides for investors. Iona makes middle-ware, programmes that allow other software work together.
