Mood Media Expects Q4 Revenues Flat On 2012, Warns On Higher Costs

LONDON (Alliance News) - Mood Media PLC said Friday that it expects fourth-quarter revenues to be ...

Alliance News 28 February, 2014 | 2:09PM
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LONDON (Alliance News) - Mood Media PLC said Friday that it expects fourth-quarter revenues to be flat on the previous year, and cautioned on higher than expected expenses relating to the integration of acquisitions.

Mood Media provides products for retailers to create a particular ambience, such as scent, lighting, video and audio tools.

Mood Media expects revenues of around USD132 million for the fourth quarter ended December 31, 2013, in line with the previous year, and a 5% increase compared to the third quarter, when it posted revenues of USD126 million. Mood Media said that this was due to the improved performance of sales related to its new audio/visual systems.

The company expects fourth quarter earnings before interest, tax, depreciation and amortisation of around USD24 million, down from USD28.0 million in the previous year. This was the result of non-recurring expenses, Mood Media said, as well as lower equipment gross margins due to a high level of large-systems installations that had been sold in previous period and installed in the fourth quarter. Mood Media noted it had since shifted emphasis away from this equipment activity.

The company also noted that it would see higher-than-expected costs in the fourth quarter that would recur, due to the integration of Muzak Holdings and branding agency DMX Inc. It expects to see quarterly incremental expenses of around USD750,000 relating to the DMX account base that has now migrated to independent affiliates.

Mood Media acquired background music company Muzak in March 2011, and DMX a year later in March 2012.

"We strongly believe that Mood is making swift and important progress in implementing its operating strategy to better position the business for long-term growth and profitability," said Chief Executive Officer Steve Richards in a statement.

Mood Media sold its residential Latin American music operations for USD16.3 million to long-term independent affiliate and operating partner Stingray Digital Group in January. The sale was made as part of the company's strategy to simplify its portfolio, and integrate and streamline its operations.

Mood Media said it will announce its full-year results on March 6.

Shares in Mood Media were trading up 7.4% at 51.00 pence Friday afternoon.

By Hana Stewart-Smith;; @HanaSSAllNews

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