25th Sep 2014 11:33
(An item published 1124 BST misstated the direction of revenue in the first paragraph. The corrected version follows.)
LONDON (Alliance News) - Cellcast PLC Thursday said it swung to a pretax profit in the first-half of the year, as it cut costs and booked a one-off payment of nearly GBP3.0 million from Sony subsidiary Entertainment Networks after it agreed the early termination of Cellcast's rights to manage the Freeview channel Movie Mix.
However, the chat and adult interactive channel operator said demand for its products in the UK continued to fall.
Cellcast posted a pretax profit of GBP2.0 million in the six months to June 30, compared with a pretax loss of GBP914,824 a year earlier, as revenue rose to GBP9.3 million, from GBP8.3 million, thanks to the one-off payment, and as cost of sales fell and administrative expenses almost halved.
The company said it had continued to see a decline in demand for its core products and services in the UK, although this had been offset by restructuring, including moving its operations to Milton Keynes.
Cellcast said that it has reduced its costs "significantly" over the last two years, and is continually looking at ways to reduce costs further, specifically through renegotiating bandwidth commitments.
As its traditional UK market continues to decline, it is investing in new genres of multi-platform TV, primarily focused on gambling and gaming. It expects these new businesses to begin operations in the first quarter of 2015.
Shares in Cellcast were trading up 18% at 1.06 pence per share Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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