Snakk boosts first quarter revenue, slows cash burn
Revenue lifted, spending down.
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Mobile advertisement developer Snakk Media [NZX: SNK] lifted first-quarter revenue 15 % while clamping down on spending.
Sales rose to $2.27 million in the three months ended June, from $1.9 million in the same period a year earlier,
On a year-on-year basis the rate of cash spent fell 83%, with $146,000 spent in the first quarter, the lowest for the company in a three-month period, it says.
Gross margin rose 70%, the company says, without providing a specific figure.
"Trading in the first half of the year is traditionally slower than the second half. There has been a focus on cost management, product pricing strategies and margin control in order to deliver a strong commercial performance for the financial year," chief executive Mark Ryan says.
"With revenues of about $10 million a year, Snakk has now reached a point of scale where each dollar of revenue is used far more efficiently than when it was a smaller company," he says.
Snakk founder and chairman Derek Handley, who still controls 15% of the company, announced earlier this week he will step down as a director by the end of the year in a wider boardroom shuffle.
Director Michelle Kong will also retire after the September 16 annual meeting as the company looks to rejuvenate the boardroom, installing Sydney-based Peter James, who is chairman of Australian cloud hosting business Macquarie Telecom, as executive chair.
The company reported a loss of $4.2 million in the 12 months to March 31, more than twice the loss of $1.8 million a year earlier. Annual sales rose 40% as the mobile advertiser entered new markets in Asia.
Snakk's 2015 annual report was tagged by auditor Staples Rodway, which cited a "material uncertainty" over the company's ability to meet revenue targets and reach a financing agreement, while keeping an unqualified opinion on the accounts.
Snakk later issued a statement saying it had sufficient cash reserves to enable future growth.
Snakk's shares on the NZAX last traded at 4.8c, and have declined 47% over the past 12 months.
(BusinessDesk)
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Suze Metherell
Thu, 03 Sep 2015
Thu, 03 Sep 2015
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Snakk boosts first quarter revenue, slows cash burn
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