Moneyweb hit by apps costs
Alt-X listed media group, Moneyweb Holdings, announced on Monday (17 September) a headline loss of R3.72 million for the 15 months ended 30 June 2012, from a prior loss of R2.91 million for the 12 months ending March 2011.
The group cited significant investment programmes over the past few years, including a substantial investment in applications, for the loss.
The group reported a basic and diluted headline loss per share of 3.49 cents for the 15 months ended 30 June 2012, from 3.06 cents for the 12 months ending March 2011.
Revenue for the reporting period improved to R44.851 million, from R35.367 million before, while Moneyweb reported a net loss for the period of R4.079 million, from a prior loss of R3.76 million for the 12 month period in 2011.
Moneyweb CEO, Alec Hogg said that the group’s significant investment programme is reflected in losses during the last two financial reporting periods.
“Together they exceed R9 million at an operating level, primarily as a result of building and rolling out the looklocal project, but also influenced by a substantial investment in Apps. The costs were expensed as they occurred. Both projects also absorbed considerable management time. Although neither is yet operating optimally, the potential is considerable.”
The group head said that, at a headline level, the loss of R3.7 million (3.5c a share) was a better result than had been expected. “It must also be seen in the context of a strong balance sheet and considerable opportunities available to internet-focused businesses right now,” he said.
Moneyweb had no debt at year end, and held cash or near-cash of R28 million, Hogg further pointed out. “This provides comfort in the current turbulent times, giving the company the ability to ride storms and take bets without threatening its underlying business. But it also puts a responsibility onto management to continuously explore ways to efficiently apply its resources.”
Operating level
For Moneyweb.co.za, Hogg highlighted an “exceptional run”, with its audience up by a third to over 200,000 unique users who, between them, downloaded two and a half million pages a month.
Mineweb.com, however, experienced a difficult period, reflecting a quieter resources market after a manic previous year. Monthly unique visitors fell by 25,000 to 135,000. “On the brighter side, although the community was smaller, they downloaded more pages than before, and stayed on the site for longer,” Hogg said.
Moneyweb said it continues to invest significantly in its provision of audio, primarily through podcasts (an integral part of the app strategy) and its long-standing relationship with the national broadcaster, the SABC.
However, a setback during the period under review was a shortening and a shift in the RSG Geldsake programme’s broadcast, from an hour in the heart of primetime (5pm to 6pm) to a more specialist slot (6:30pm to 7pm). “This triggered negotiations to find ways to deepen the relationship with the SABC, a process which is ongoing,” it said.
The way forward
Moneyweb said that with the considerable upfront investment in looklocal and apps behind it, the group is budgeting for better financial results during the year-to-end June 2013.
“Apart from new revenue streams, the company’s core offerings are benefitting from a continued switch in advertising spend from analogue (print) to digital (online) platforms,” Hogg said.
“Companies are clearly adapting to the change in the media consumption habits of their customers. Since the 2010 financial year, digital’s contribution has grown from just over half to more than two thirds of Moneyweb Holdings’ revenues. The momentum is expected to continue,” the group said.
Moneyweb said that the looklocal partnership with Caxton has progressed well, with the now 43 hyper-local sites attracting around 500,000 unique visitors a month. A recent management change at the Caxton-owned newspaper, The Citizen, has also introduced fresh opportunities, it said.
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