18 Jun 2010 15:53
18 June 2010 iPoint-media plc ("iPoint-media" or "the Company") Trading updateand strategic review
During the first six months of 2010 the Company has experienced significant slippage on tenders submitted in conjunction with its strategic partner Ericsson, to telecoms companies that were anticipated to be signed and delivered prior to 30 June 2010. As a consequence, the Company's revenues for the six months ending 30 June 2010 will be substantially below market expectations and the Company loss for that period is estimated to be in the order of £0.7 million.
This delay in revenues has impacted the Company's ability to meet its working capital requirements. As a consequence, the Company is taking immediate action in implementing a cost reduction programme to reduce operating costs in the order of 25%, including cuts in employee related expenses. However, unless the Company is able to generate increased revenues in the short-term it will require an injection of cash in order to continue operating as a going concern.
In addition to the review of its cost base, the Company's management, after conducting a strategic review, has determined to concentrate the Company's resources in pursuing opportunities in the media market, given the difficulties experienced in the Telecoms market. Accordingly, the Company announces that, while it will continue to support its strategic partnership with Ericsson, it will be focusing on expanding sales of its new products GOliveINTERVIEW and GOliveSTUDIO to the media market in China.
GOliveStudio is a WEB/Mobile TV production tool that provides new media connectivity and Internet content repurposing at a fraction of the cost of hardware-based solutions. In addition, the Company's "GOliveInterview" product enables broadcasters to conduct a live interview with a reporter equipped with no more than a standard computer laptop, camera, and iPoint-media reporter software. The target market for GOliveInterview will be Chinese media companies, and the target market for GOliveStudio will be Chinese Radio/Web/ Mobile TV stations. The Company estimates that there are over one thousand TV broadcasters in China, representing a very substantial market opportunity for iPoint-media.
Muki Geller, iPoint-media's CEO, commented:
The continuing slowdown in the Telecoms market has proved a major challenge to the Company's efforts to generate revenues through the Ericsson channel with a consequent negative impact on our cash flow.
On the other hand, the Chinese media market represents a significant opportunity for us and is attractive in that is has been less affected by the global economic slowdown. There is a real need for our products and solutions in this market place and we are working with significant channel partner in order to capitalize on these opportunities. We are seeing signs of strong demand and interest in these products and we are setting up a Chinese delivery entity to support our large Chinese partner, who acts as the sales channel, in fulfilling the market demand.
Further enquiries:iPoint-media plc +(0) 972 544 450 667Muki Geller
Libertas Capital Corporate Finance Limited +44 20 7569 9650
Thilo Hoffmann/ Andrew McLennan
vendor