UK’s Micro Focus targets better revenue in two years on turnaround boost

(Reuters) -Britain’s Micro Focus International on Tuesday laid out a target to end 2023 with flat or slight revenue growth, compared with a provisional 5% decline in 2021, as the software firm benefits from a turnaround plan it launched last year.

The company, which helps customers maintain and integrate legacy IT technology, launched a three-year turnaround plan in 2020 to make up for very high costs related to its $8.8 billion acquisition of Hewlett Packard Enterprise’s software assets in 2017.

“Having now completed the HPE integration we can once again focus on our core objectives that we know deliver success,” Chief Executive Stephen Murdoch said in a statement.

Micro Focus does not expect any exceptional costs related to the deal beyond this year and said it was aiming for an equity free cash flow run rate of $500 million by 2023 end.

“We have robust, granular plans for the next 2 years that give us confidence to achieve our core financial objectives as we exit FY23, and a strong foundation from which to execute thereafter,” finance chief Matt Ashley said.

The company, which had also transitioned to a single IT platform to simplify its operations, is expected to host a briefing later in the day to detail its two-year plans.

(Reporting by Pushkala Aripaka in Bengaluru; Editing by Arun Koyyur)