Shares in online market research agency YouGov fell 45% this morning, following its prediction that revenue for the six months to the end of January would fall short of expectations.
Its shares almost halved after the Board acknowledged that profitability for the current financial year will be 'significantly below market expectations' of around £10m, as financial services clients cut research budgets because of the credit crunch.
The firm says that this anticipated low growth rate is due to much weaker than expected new business in the UK, although there has been good growth in a number of markets such as Germany and the USA.
Yet despite these trading conditions, revenue for the first six months of the financial year is expected to be approximately 20% higher than in the same period last year.
'Online market research will continue to grow as a proportion of research spend and we believe that YouGov is uniquely positioned to meet the demand for accurate, high-quality real-time research,' stated co-founder and CEO Nadhim Zahawi. 'We see the recession as further disrupting this industry, which gives us an opportunity to build the leading market research company of tomorrow,' he added.
During 2008, the group invested heavily in new product development and increased headcount. Zahawi insisted that the company would continue to invest in developing new services despite the setback.
Yesterday, YouGov launched a platform to provide insight into how consumers are responding to the adverse economic conditions; while in January, it announced a report that tracks consumers' use of social networking sites.
Web site: www.yougov.com .
All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.