ASX-listed network encryption vendor, Senetas, is expecting a record net loss before tax between $3 million and $4 million for the financial year ending June 30.
The net loss is being put down to difficult global economic conditions, ongoing delay of data security projects within Australian governments and Telstra’s decision to outsource and offshore a long standing contract with its consulting division.
The company experienced a net loss of $1.6 million in the first half of the 2011 financial year.
According to the statement on the ASX, directors also noted the company was impacted by the significant appreciation of the Australian- US dollar exchange rate and the poor performance of its key US distributor for its technology.
“During the current fiscal year we invested almost $2 million in new product development and enhancing our sales and distribution channels so we were positioned to take advantage of emerging markets and accelerate growth,” Senetas CEO and Chairman, John DuBois, said in a statement.
“Lingering effects of the GFC remain and the global economy is still in a challenging state, but we are confident that these investments will provide us returns in the next financial year and coming years.”
The company plans to continue its R&D efforts within its globally certified encryption platform, upgrading to full turn-key manufacture with lower cost of goods, smaller footprint, inbuilt redundancies and enhanced functionality.
Senetas also recently entered CAPs evaluation, which is a UK certification program that allows its encryption technology to be sold to Her Majesty’s Government and its agencies. Its products already feature two other international certifications including Common Criteria EAL4+ and FIPS 140-2 Level 3.
Directors expect the financial performance to improve as these opportunities come to fruition.