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Customer communications management system developer Solution Dynamics (SDL) has requested a halt to trading in its shares on the New Zealand Stock Exchange after the apparent loss of its major customer.
The company had previously advised investors that its largest customer was undertaking a tender [or RFP] covering the communications services it provided.
“During the weekend, SDL was advised that it had not been successful in the RFP process,” chair John McMahon announced today.
“However, a number of issues remain unclear, particularly whether this decision applies to all or only part of SDL’s services to the customer; furthermore, SDL currently has no information about the timing of the hand over process.”
In its 2024 annual report, released in August, SDL said the customer’s tender covered a SaaS software platform to create highly personalised sponsor communications at scale, technically complex data management, digital document management, and global distributed print requirements.
“Responding to the formal RFP and subsequent data requests involved significant staff time and effort over FY2024,” the company told shareholders.
“SDL is pleased with our progress to date, having driven substantial and ongoing cost savings for the client, through a global distributed print model.”
However, the higher support costs and “somewhat” lower revenue impacted the company’s results.
“We continue to be awarded new work by the client on key programmes,” SDL noted. “Nevertheless, uncertainty will remain until the customer concludes its process; SDL reiterates this customer provides a very material contribution to the company’s financial outcomes.”
SDL said today it had a debriefing call with the customer’s procurement team scheduled overnight night and would consider and review the information received tomorrow before making a formal announcement.
Customers noted on the company’s website include Worldvision International and Auckland Council, which went to tender in July for “digital print room” technologies.
In September, SDL was the target of an unsuccessful buyout by NZX-listed Being AI.