Mobile Tornado Profit Hit By Hiring And Capital Investments
(Alliance News Via Acquire Media NewsEdge) LONDON (Alliance News) - Mobile Tornado Group PLC Wednesday said its losses widened in 2013, after an increase in activity levels "compelled" management to make significant human and capital investments.
The company, which provides communications software for mobile devices, posted pretax losses of GBP2.5 million for 2013, compared with losses of GBP1.8 million a year earlier.
Mobile Tornado said it hired staff and made significant capital investments in the business across its sales, technical and customer services operations. This investment for growth resulted in operating expenses increasing during the period to GBP3.1 million from GBP2.5 million. As a result, operating losses increased to GBP2.0 million from GBP1.3 million.
"We believe the current headcount and cost base is now at a suitable level to see the business develop over the medium-term," Mobile Tornado said.
Revenue, however, increased to GBP2.7 million in 2013 from GBP1.5 million in 2012, which the company attributed to an increase in income related to the major installation of its Tier 1 Mobile Network Operator (MNO) in Canada.
The firm said it made continued progress during 2013, with 29,000 billing licences signed at the period-end compared with 19,000 a year earlier, along with the commercial launch of TELUS Link - a Push To Talk service (PTT) - in Canada. Push-to-Talk services allows instant communication without the need to dial on a one-to-one or one-to-many basis.
Last month, the firm said it planned to create a separate division to target Israel, which is an established PTT market and one that it examined carefully during the second half of 2013. Since then, the firm had made a number of senior appointments to help launch the division. Mobile Tornado said it hopes to report a successful outcome in terms of commercial deployments in the second half of 2014.
"The period under review has also been characterised by a number of large installation projects and good progress on a number of continuing trials, which we expect to start generating recurring licence fee revenues in the near future," Chief Executive Jeremy Fenn said in a statement.
"We have prepared the company to deliver on further growth and remain confident that we will deliver significant shareholder value from our pipeline of opportunities," he added.
The company did not recommend payment of a dividend, unchanged from the previous period. Instead it said it plans to "reinvest future earnings to finance the growth of the business."
The stock was trading flat at 17.00 pence Wednesday morning.
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