Iona Technologies has warned that its third-quarter results will not meet expectations, largely as a consequence of last month's US terrorist attacks. The company is forecasting revenues of approximately $41 million (€44.68 million), down $5 million on some analysts' predictions.

This translates into a pro-forma net loss for the third quarter of approximately $2.2 million, or eight US cents per share. Although the extent of the reduction in projected revenues was a surprise to some, most analysts had been expecting a dip in numbers.

In a briefing note last week, Merrion Capital pointed out that Iona sold around 50 per cent of its licence revenues in the last month of a quarter, most of this during the final two weeks, as customers waited for the best discounts.

This was especially true in the third quarter, as business resumed in September after the summer lull of July and August. With the US attacks falling in such a crucial month, a bad quarter suddenly became much worse.

Iona chief executive officer, Mr Barry Morris, yesterday admitted that the last three months had been difficult for the company, saying that the attention of senior decision-makers had been diverted by the World Trade Centre and Pentagon attacks. "Our entire sector is in pretty bad shape as a result of the September 11th events," he said.

Analysts were yesterday generally positive about the company: "We think it's very well-positioned," said Ms Velma Roberts in NCB.

Iona closed at €10 (£7.88) in Dublin yesterday, down 10.5 per cent on the day. Iona will issue final results for the third quarter on October 17th.