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Micro Focus shares tumble 30% after revenue warning

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FILE PHOTO: Signs outside the offices of British IT company Micro Focus International
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  • MFGP

LONDON (Reuters) - British IT group Micro Focus International will miss its full-year revenue target and accelerate a review of its operations, it said on Thursday, sending its shares plunging in early trade.

Shares in the group fell 30% to a 16-month low of 10.86 pounds after the unscheduled update, which the company blamed on weak sales execution and a deteriorating economic environment

The company downgraded its revenue forecast for the year to Oct. 31 to between minus 6% and minus 8%, compared with previous guidance of minus 4% to minus 6%.

"Following the recent disappointing trading performance, we have determined that it is appropriate to accelerate the undertaking of a strategic review of the group's operations with a view to determining where performance can be improved and how the business can be better positioned to optimise shareholder value," said Chief Executive Stephen Murdoch

The company, which maintains and upgrades the legacy software systems that underpin big businesses such as banks and airlines, had reiterated its guidance as recently as last month, when it reported a 5.3% fall in first-half revenue.

(Reporting by Paul Sandle; Editing by David Goodman)