The print shop, supplies and website designer said revenues for 2017/18 will be just under £15mln, 40% higher than the previous year but still below management forecasts.
Volumes and margins in trade business were below budget in December and January and fell away sharply last month.
As a result, losses for the year to March will be around £2.85mln, or similar to 2016/17.
Grafenia’s strategy has to be to shift away from the intensely competitive print shop business and regroup around Nettl, its web design operation, with add-on acquisitions such as signage to widen its offering.
Spending on the re-positioning may hit earning further in the short-term, Grafenia added, but is necessary for its long-term transformation.
Cash generation is healthy said Grafenia, a trend it expects to continue.
Shares eased 3% to 12p.