LONDON (Alliance News) - Shares in Forbidden Technologies PLC are trading down 22% Thursday after it posted a widened pretax loss for 2014, mostly as a result of significant investments it made during the year including a thwarted attempt to expand into the US.
Forbidden Technologies owns and operates cloud video editing platform Forscene.
The company had hoped to break into the post-production market in North America, which is valued at around ten times that of the UK, and established a US subsidiary in March of last year. However, it said that by last December it was clear that this opportunity was taking "much longer" to be captured than expected and the "cash risk to the business was too high to continue".
As a result, it disbanded its management team in California, although modest resources in Canada and the eastern US were maintained. Forbidden said that after the year end the West Coast management team concluded an agreement with Forbidden to become resellers of Forscene on a revenue share basis under their new company, Technicalogy.
Additionally, Forbidden invested heavily in updating its technology, to develop a new interface for the Forscene brand and creating a media asset management system, which required a "significant increase" in research and development resources, and it worked on the development on a new video social network called 'eva'.
Forbidden posted a pretax loss of GBP3.6 million in 2013, from a pretax loss of GBP802,778 in 2013, as revenue declined to GBP689,222 from GBP772,180, and administrative expenses nearly tripled to GBP4.2 million from GBP1.5 million.
The company has cut costs by reducing a layer of its senior management, and said that this will help lead to a total reduction in annual costs of GBP1.0 million.
Forbidden attributed the drop in revenue predominantly to a reduction from a single North American client.
"The investment in the platform over the years, including the record investment in 2014, makes this coming year an attractive challenge," said Chief Executive Stephen Streater in a statement.
Shares in Forbidden are trading down 22.2% at 7.00 pence Thursday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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Forbidden (FBT)