Mobile Streams Shares Drop As Annual Revenue Halves On Argentina Woe

LONDON (Alliance News) - Shares in Mobile Streams PLC plummeted a fifth on Friday after annual ...

Alliance News 9 November, 2018 | 9:13AM
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LONDON (Alliance News) - Shares in Mobile Streams PLC plummeted a fifth on Friday after annual revenue fell sharply amid a dire sales performance in its core Argentina business, despite losses narrowing as costs were trimmed.

Shares in mobile media firm Mobile Streams were 22% lower at 0.72 pence on Friday.

For the year ended June, pretax loss narrowed 39% to GBP931,000 from GBP1.5 million the year prior. This was despite revenue falling 47% to GBP3.0 million from GBP5.7 million a year before.

The sharp drop in revenue was primarily caused by "ongoing challenges" in its core Argentina business. This unit - which contributes 76% of total revenue - experienced a 37% drop in constant currency revenue during the year.

"We announced that trading conditions in Argentina were extremely challenging in the year under review as a result of macroeconomic conditions and regulation in the local market for mobile content subscriptions," Mobile Streams Chief Executive Officer Simon Buckingham said. "These conditions are continuing but we are confident that our strong relationship with our carrier billing partner, which remains very supportive of our business, will enable us to manage this."

Profit performance was helped by a steep fall in administrative costs to GBP1.7 million from GBP2.6 million the year prior. Marketing costs also dropped to GBP638,000 from GBP769,000 the year before.

With no debt, the firm continues to hold a net cash balance of GBP1.0 million. The firm does not pay a dividend.

Looking forward, Mobile Streams is looking to grow its revenue across it business and maintain "positive" margins in both its established, core Argentina market and growing business in India which it believes is its "largest" growth opportunity.

"In India, we announced that trading has been impacted by the further consolidation of the mobile operator market, in addition to downturn in revenues experienced by the operators since the launch of the newest entrant to the market," Buckingham explained. "In spite of the challenges posed by the current conditions, revenues continue to increase quarter by quarter, meanwhile margin has improved as our marketing strategy has aligned more with those of the key local competitors."

By Ahren Lester; ahrenlester@alliancenews.com

Copyright 2018 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article
Security Name Price Change (%) Morningstar
Rating
Mobile Streams PLC 0.73 GBX -6.45 -
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