6th Apr 2016 07:55
LONDON (Alliance News) - Specialist information business Electric Word PLC on Wednesday reported a widened pretax loss for its most recently ended financial year, as it continued to make progress with simplifying and streamlining its business.
The company reported a pretax loss of GBP2.9 million for the year to end-November, widened from a pretax loss of GBP1.9 million a year before, as a slip in revenue to GBP6.9 million from GBP7.1 million was compounded by a GBP1.0 million impairment charge related to its Optimus business.
Electric Word attributed the lower revenue to reduced sales in its Education division, which offset growth in its Sport division and higher revenue from subscriptions.
During the year the company sold Radcliffe Solutions Ltd, which provided IT services to the health sector, and also Radcliffe Publishing, which produced books for medical and other health professionals. Following the year end the company also exited from the online gaming sector, selling its 70% interest in its iGaming Business for GBP13.8 million.
Following the sale of the iGaming business, Electric Word said it is undertaking a comprehensive review of its infrastructure, systems and processes, to ensure its central costs are appropriate given its smaller size. Although it expects to reduce central costs where it can, it noted that its likely its central costs will be higher in its current year as a result of higher property costs and costs previously allocated to businesses which it has sold.
Towards the end of 2015, the company had indicated it was considering a capital return to shareholders after the sale of the iGaming stake. However, it noted that it is mindful that the timing of its return to profitability is uncertain. Electric Word said is continuing to review its options and said it doesn't consider a capital return to be appropriate whilst this review is ongoing.
"We made progress in 2015 in simplifying the group and have transformed our balance sheet through the sale of iGaming Business, which demonstrated the group's ability to add value to its businesses," said Chief Executive Julian Turner in a statement.
"Trading in 2016 will be affected by higher unallocated central costs than in 2015 but net margins in both Sport and Education are currently running slightly ahead of board expectations as a result of tighter cost control," Turner added.
Shares in Electric Word were down 4.9% at 3.85 pence Wednesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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