EarningsAVEVA issues periodic trading updates in between the more formal and detailed announcements every six months. These interim press releases typically don’t say much — but every so often something interesting slips through. This time, the nuggets aren’t joyous.

In the 12 September 2014 update, AVEVA said that it expects to take a £14 million hit in H1 2015 because of unfavorable currencies and the fact that its license renewals are weighted towards the end of the year. Add in a sales force reorganization, and revenue expectations fall. But that’s not all. The company reports “a reduction in demand in South America and parts of Asia, set against double-digit growth in China … [lead us to expect] reported first half revenue in the range of £84-90 million, dependent on the timing of contract signings.”

That’s a 20%ish decline from H1 2014 revenue of £109 million, itself an 11% increase over H1 2013. AVEVA had warned of currency issues, and had made public the sales reorg, but the news was worse than expected and sent shares down nearly 25% in Friday.

I’ve heard rumblings that there is a slowdown in offshore platform work going to shipyards in Korea; it’s possible that this is part of the problem AVEVA ran into. AVEVA also indicated that it has seen no change in the competitive environment. That’s investor-speak for “these problems are macro-economic or of our own making; a competitor isn’t taking deals away”. That, at least, is good news since it means AVEVA may be able to fix some of the underlying problems.

H1 ends on September 30, so we won’t know exactly what happened in H1 until mid-November. In the meantime, AVEVA is hosting an investor day on Wednesday and we should learn more about the problems in Asia and South America and AVEVA’s response.