Shares in Trafficmaster have slumped to their levels of 30 months ago after the motoring data firm revealed it would make a loss this year.

The stock fell by more than a third to 109.75p after the firm warned investors that it would fail to meet "aggressive" targets.

The firm, which installs and operates traffic monitoring equipment designed to help motorists avoid jams, blamed the shortfall on disappointing sales in Europe.

Delays in recruiting and training a European sales force have seen sales in the firm's key Fleetstar product, aimed at fleet managers, take "longer to start growing than we had expected".

"As a result of these timing differences, it is likely that losses in the first half [of 2001] will continue into the second half, resulting in an overall loss for the financial year," the company said.

Three weeks ago, chief executive David Martell assured investors that "the building blocks have been put in place to grow revenues from the second half".

Long-term growth

The firm remains confident, however, that it will be running at a profit by the end of the year.

And the briefing forecast rich long-term pickings as car manufacturers begin to fit Trafficmaster equipment to new vehicles.

"It is widely forecast that by 2005 possibly 50% of all new cars in Europe and the USA will be telematics-equipped, and therefore potential customers of Trafficmaster."

International ambitions

In the UK, the firm has fitted sensors to more than 8,000 miles of major roads.

The sensors collect information on traffic speeds for transmission to users, who can use it to help them avoid traffic jams.

On the Continent, the firm has installed networks in France, Italy, Benelux states and, notably, Germany, "Europe's largest and most influential automotive market".

Trafficmaster in February announced the purchase of California-based Teletrac to build a US presence.

Trafficmaster shares, whcih reached a closing high of 1155p in March last year, had recovered by 1410 GMTG to stand at 120p, down 51p on the day.

The shares have not closed below 120p since October 1998.