2nd Apr 2014 09:28
LONDON (Alliance News) - Shares in Cupid PLC tumbled Wednesday as the online dating operator said it swung to a loss in 2013.
Cupid said revenues dropped significantly as a result of selling of its casual businesses, which represented 70% of its overall revenue. The casual businesses were aimed at people who want to flirt and included the sites BeNaughty.com, Flirt.com and CheekyLovers.com.
Cupid shares dropped 12% Wednesday morning to trade at 61.16 pence.
The company maintained its total dividend for the year at 3.00 pence per share. It said it swung to a pretax loss of GBP7.9 million in the year ended December 31, 2013, compared with a pretax profit of GBP9.2 million in 2012.
Revenues for the year from continuing operations was GBP26.6 million, similar to the level reported in 2012. However total revenues for the year, including discontinued operations, came to GBP56.1 million, significantly lower than the GBP80.9 million in total revenues the prior year.
The internet dating company recently commenced plans to restructure the business.
Cupid said that it has several product launches in the first quarter of its current financial year, as part of its three-year strategic plan, and said it expects a positive run rate for profits when it enters 2015.
"Though it is still early in the financial year and the full effects of our new product launches have yet to be seen, we are already seeing improvements in our key metrics. We have also been re-addressing the marketing mix to ensure we can continue to raise the quality of traffic," said Chief Executive Officer Phil Gripton in a statement.
"We have a big year ahead of us, and there are on-going challenges that we are addressing, but the early positive signs are that we are on track," Gripton added.
During the year the company sold its casual business in order to focus on building an international portfolio of niche and mainstream dating website such as UniformDating.com and Cupid.com, where it said it sees the biggest growth opportunities.
Former Chief Executive Bill Dobbie told Alliance News last year the casual dating sites were driving up male and female imbalances, meaning too many men.
It said its recorded a pretax gain of GBP23.4 million during the year, reflecting both the sale of its assets to Grendall in July, as well as the disposal of its German business.
The internet dating company became involved in a scandal in July last year, regarding whether the company was using improper methods to encourage people to move from free to paid subscriptions.
Cupid categorically denied all the accusations, but said it booked GBP1.3 million in legal and other costs during the year, associated with investigating and addressing the accusations, as well as a provision for patent infringement costs and employee tribunal costs.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
Copyright © 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
CUP.L