On Friday, iPoint Media Ltd. (AIM:IPNT) issued a profit warning for the first half of 2010, and it is getting close to the point where its auditor will append a going concern warning to the company's financial report.
iPoint's share price fell 20% today on London’s Alternative Investment Market (AIM) to ₤0.02, giving a market cap of ₤3 million.
iPoint said that it "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 £700,000."
iPoint added that the delay in revenue has affected its ability to meet its working capital requirements. It is therefore taking immediate action in implementing a cost reduction program to cut operating costs by 25%, including cuts in employee related expenses. It warned that unless it can boost revenue in the short-term, it will require capital injection to continue operating as a going concern.
iPoint added that, after conducting a strategic review, it will concentrate the company's resources in pursuing opportunities in the media market, given the difficulties experienced in the telecommunications market. Therefore, while it will continue the strategic partnership with Ericsson AB (SAX; Nasdaq: ERIC), it will be focusing on expanding sales of its new GOliveINTERVIEW and GOliveSTUDIO products 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. GOliveInterview 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.
iPoint will target Chinese media companies for the GOliveInterview solution and Chinese radio, web, and mobile TV stations for the GOliveStudio solution. The company estimates that there are over one thousand TV broadcasters in China, representing a very substantial market opportunity.
Published by Globes [online], Israel business news - www.globes-online.com - on June 21, 2010
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