Knock-on effects of banking crisis hit I-Design as it warns contract delays will lead to losses

Published on Friday 22 May 2009 21:52

I-DESIGN, which provides a platform for advertising on cash machines screens, has been dragged into the banking crisis, warning yesterday that delays to two key contracts would lead to a larger than expected loss.

Ana Stewart, chief executive of the company, headquartered in Newport-on-Tay, admitted that contracts it expected to sign with two "well-known UK banks" in the current financial year were taking much longer than expected to complete.

"They've obviously got things to think about and there's been a bit of a ripple effect," Stewart said.

She added: "With the challenges in the banking market we're just seeing delays to what we believed was going to be happening this year."

Because of the delays, I-Design, which is listed on Aim, warned that it expected to post a pre-tax loss of 1.2 million for the year to 30 September – more than double the 500,000 loss it reported in the previous year.

Although there was no certainty about when the deals with the two banks, which Stewart declined to name, would be completed, she maintained that contracts would be signed off eventually.

She said: "We've still got the interest, it's just the time it's taking."

Stewart added that the company should have the resources to see it through a period when banks are making little or no investments, with I-Design holding net cash of 1.7m at the end of April.

"We're quite robust and quite cautious about how we do things, and we've obviously got a strong cash position," she said.

"Strategically, we are confident that we can see ourselves through these issues."

I-Design offers a platform for banks to provide advertising on cash machines. It also procures the advertising, running campaigns for companies such as airlines, mobile phone providers and fast food outlets.

Its existing customers include Tesco, as well as some Royal Bank of Scotland and Alliance & Leicester machines. It also provides products to "a major Greek bank".

Shares in the company closed 2.5p lower at 14p last night.