Last checked at 16 Jan 2009 09:58
Upstream Marketing and Communications Inc.
("Upstream" or "the Company")
Trading Update
The Board of Directors (the "Board") announces an update on the Company's current trading and progress against its business plan.
Following the Company's Interim Results announced on 23 September 2008, which highlighted the uncertainty of the impact of the global economic slowdown, the Company has witnessed a further deterioration in market conditions and now expect operating profit to fall materially below internal management expectations.
In the results for the full year ended 31 December 2008, which are expected to be announced in June 2009, the Company anticipates reporting a profit before tax, partially attributable to non-recurring revenue from the sale of the Company's Media Services Asia subsidiary in May 2008. However, in the period since the interim results were announced, there has been a significant slowdown in revenue as existing clients and other prospects have held back or reduced their usual communications budgets for Q4 2008. Furthermore our current sales pipeline indicates that this trend will continue throughout 2009.
On this basis, the Board has commenced the implementation of a number of steps which it believes will enable the Company to deal with the challenging economic environment faced by the Group. These steps include a scaling back of the Company's topline business plan, and a reduction in the Company's cost base primarily through a decrease in headcount across the Group through attrition and the removal of replacements and future hires from the budget. In addition, management is stepping up marketing efforts with a view to improving revenue generation, reducing operational expenses, and monitoring closely the ongoing cashflow requirements of the Group.
Given these measures and based on the existing outlook for the Group, the directors believe the Company has sufficient working capital for the medium term.
Enquiries:
David Ketchum
+852 2973 0222
david@upstreamasia.com
www.aboutupstream.com
James Harris/Angela Peace
Strand Partners Limited
+44 (0)20 7409 3494
Claire Louise Noyce/Stephen Austin
Hybridan LLP
+44 (0)20 3159 5085