MobileActive revenues on the slide

EBITDA steady, but company took a “cautionary” approach to market expenditure

Independent mobile phone content and services company, MobileActive (ASX:MBA) has seen a 9.1 per cent drop in revenue for the year to 30 June 2010, resulting from a “cautionary” approach to market expenditure.

The company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) remained fairly steady dropping to $1.4 million for the year to 30 June 2010, a decrease of 4 per cent on FY09 results.

Net profits after tax also fell from $263,326 in the year to 30 June 2009, to $81,556 in FY10.

Cash and cash equivalent assets were posted as $829,511 down from $1.2 million in the precious financial year.

In a statement to the ASX, MobileActive chief executive, Chris Thorpe said his company had performed well against the sizable change and difficult trading environment of the Australian mobile industry, while maintaining and developing growth opportunities.

“Through transformation and diversification, the asset base of the company has been substantially strengthened to scale and deliver across multiple product and service markets,” Thorpe said. “In the coming year we expect this to deliver strong growth and in following industry forecasts, see substantial increases year on year.”

According to the statement, the company spent the FY10 focusing on the development of scalable assets in all three of its divisions, Mobile Entertainment Retail (MER), Mobile Embrace and RingRing Studios.

“MER still provides the majority of the company’s revenue and is the division that has been most impacted by the challenging market conditions,” the ASX statement read.

“During the financial year, in assessing the impact of new and increased regulation in the market place the company has taken a cautionary approach to marketing expenditure, decreasing it by 29% and has carefully managed the cost of customer acquisitions.”

The company acquired a 50.1 per cent majority shareholding in online racing and tournament businesses 12Follow and TopBetta, in April this year, to add diversity to the MER branch and ensure the potential for future growth.

Mobile Embrace also saw expansion, entering into licensing agreements with the UK’s 2sms.com and Mobile Interactive Group, to increase its offering in the Australia and New Zealand market.

Mobile Embrace launched mobile internet and applications publishing platform, Kilrush, for Australia and New Zealand in August this year.

The third sector, RingRing Studios, has been described by the company as “still fledging”, however it did record a global sales increase for mobile applications of 50 per cent in four months from April 2010, to August 2010.

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