Blinkx moves up after trading update
Nov 11, 2014 at 1:51 pm in AIM by contrarianuk
Online video ads specialist Blinkx like Quindell has been embroiled in a battle with short sellers and in the case of Blinkx its problems started with a negative report from Associate Professor Ben Edelman at Harvard University who alleged that the company was inflating its video click rates. The company was originally spun out of Autonomy, which after being acquired by Hewlett Packard had its value written down by billions due to alleged accounting fraud.
Today the company issued its result for the six months from April 1st 2014 to September 30th.
Revenue came in at $106 million, compared with $111 million in the same period in 2013 with loss before tax of $9.7 million compared with a profit of $10.78 million. Cash burn totalled $12 million but the company had $114.5 remaining following a placing in December. Adjusted EBITDA before acquisition and non-recurring costs and amortisation of purchased intangibles for H12015 was $1.0 million compared with adjusted EBITDA before acquisition and non-recurring costs and amortisation of purchased intangibles of $18.2 million for H12014.The company said that it expected similar results in the second half of the year due to mobile investment. Weaker results this time around were blamed on uncertainty amongst advertisers not helped by Edelman’s disputed report. Like many digital advertising platforms there has been a fundamental shift as users are increasingly using mobile rather than desktop and the advertising revenue per click tends to be lower on these devices. For Blinkx the company’s mobile revenues now represent 20% of the total. The shares are up today around 5% to 28.75p but are down nearly 90% in the last year.
You would think that Blinkx would sooner rather than later fall to a bid especially with the cash on the balance sheet as video ad serving still remains a sexy space for those with content like Yahoo or Google and eager digital advertisers .
Contrarian Investor UK
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