20th Mar 2019 10:04
LONDON (Alliance News) - Frontier Smart Technologies Group Ltd on Wednesday said its loss widened in 2018 due to the weak performance of its Digital Radio business.
The audio and smart home software provider reported a pretax loss of USD3.3 million in 2018 compared to USD2.1 million a year earlier, as revenue dipped 21% to USD41.8 million from USD53.0 million.
The drop in revenue is largely due to the completion of FM switch-off in Norway in 2017, which hurt the performance of the company's Digital Radio unit.
The Smart Audio division also failed to grow in line with expectations due to intense price pressure, Frontier said.
Research & development spend in 2018 was USD7.5 million, down from USD8.5 million the year before. The company expects research & development expenses to decrease further in 2019 as a part of a cost reduction plan.
Looking ahead, Frontier said Digital Radio volumes are expected to return to modest growth, resulting in an improvement in earnings before interest, taxes, depreciation, and amortization.
"Frontier is in a transitional phase. The group's Digital Radio business continues to deliver strong positive cash flows. Having seen a dip in sales in the first half of 2018 following the completion of digital switchover in Norway in 2017, Digital Radio sales stabilised in the second half of the year," said Chief Executive Anthony Sethill.
"Our multi-ecosystem software platform is now largely complete which has allowed us to reduce our research & development expenditure," added Sethill.
Frontier shares were trading 0.7% higher on Wednesday at 34.75 pence each.
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