TIDMAFRN
RNS Number : 5107S
Aferian PLC
10 March 2023
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated by the
Market Abuse Regulation (EU) No.596/2014, as it forms part of UK
law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").
Upon the publication of this announcement, this inside information
is now considered to be in the public domain.
10 March 2023
AFERIAN PLC
("Aferian", the "Company" or the "Group")
Trading Update, FY22 Results Delay & Board Update
Aferian plc (LSE AIM: AFRN), the B2B video streaming solutions
company, today provides an update on current trading and its impact
on the outlook for the financial year ending 30 November 2023.
H1 FY23 current trading
The 24i business (which focuses on streaming video services) won
six customers in the final quarter of 2022 and this momentum has
continued in the first quarter of 2023. Trading continues in line
with expectations. The focus for 24i in 2023 is to continue to grow
revenue and ARR at double digit percentages whilst also increasing
profit margins.
For our Amino business (which connects Pay TV to streaming
services), as previously communicated, the wider macro-economic
situation resulted in a decline of revenues in the second half of
2022 as some customers delayed their orders of new streaming
devices, preferring to run down their existing inventory. This
trend has continued longer than we expected and device sales in the
first half have been materially lower than anticipated. While Amino
continues to have a strong sales pipeline for second half of 2023,
the recovery is now not expected until later in the financial year.
As a result, management now expect Amino's outturn for the full
year ending 30 November 2023 to be substantially lower than
originally anticipated.
Actions to reduce the Group's cost base
The management team has already taken significant steps to
identify and deliver efficiencies in the Group's cost base. These
steps have already reduced the Group's annualised cost base by
c.$5m. These cost reductions were underpinned by efficiencies
identified in the operations and research & development teams
of both our 24i and Amino divisions.
FY23 Outlook
Whilst it is early in the new financial year, in light of the
above performance from the Amino division, the Board now expects
Group revenue and adjusted EBITDA for the year ending 30 November
2023 to be substantially below its original expectations. Whilst
device revenues continue to be negatively impacted by the current
market environment, the Board has confidence in the growth drivers
of the video streaming market as well as Aferian's ability to
address that market. Notwithstanding the difficult trading
conditions of the Amino business in the first half of the year, the
Company is still expected to generate a positive material adjusted
EBITDA for the full year.
Publication of audited results for the year ended 30 November
2022
The Company has already announced that it expects to report
revenue and adjusted operating profit for the year ended 30
November 2022 in line with the trading update published on 8
December 2022.
The Company is in compliance with its banking covenants and is
in discussions with its banks to ensure future covenant compliance.
This will delay the announcement of the full year audited results
for the year ended 30 November 2022. A further announcement will be
made as and when practicable.
Intended Board Change
Subject to the satisfactory completion of the necessary NOMAD
enquiry & due diligence process, the Board intend to appoint
Max Royde to the Board as a Non-executive Director.
Max Royde is a managing partner at Kestrel Partners, an
investment management company specialising in business-critical
software companies, which has a beneficial holding in Aferian of
22,781,891 shares or 26.12% of the issued share capital of the
Company.
The person responsible for the release of this announcement on
behalf of the Company for the purposes of MAR is Mark Carlisle.
For further information please contact:
Aferian plc +44 (0)1223 598197
Donald McGarva, Chief Executive Officer
Mark Carlisle, Chief Financial Officer
Investec plc (NOMAD and Broker) +44 (0)20 7597 5970
David Anderson / Patrick Robb / Nick Prowting / Cameron MacRitchie
FTI Consulting LLP (Financial communications) +44 (0)20 3727 1000
Matt Dixon / Emma Hall / Tom Blundell
About Aferian plc
Aferian plc (AIM: AFRN) is a B2B video streaming solutions
company. Our end-to-end solutions bring live and on-demand video to
every kind of screen. We create the forward-thinking solutions that
our customers need to drive subscriber engagement, audience
satisfaction, and revenue growth.
It is our belief that successful media companies and services
will be those that are most consumer-centric, data driven and
flexible to change. We focus on innovating technologies that enable
our customers to stay ahead of evolving viewer demand by providing
smarter, more cost-effective ways of delivering end-to-end modern
TV and video experiences to consumers. By anticipating
technological and behavioural audience trends, our software
solutions empower our customers to heighten viewer enjoyment, drive
growth in audience share and ultimately their profitability.
Aferian plc has two operating companies: 24i, which focusses on
streaming video experiences, and Amino, which connects Pay TV to
streaming services. Our two complementary companies combine their
products and services to create solutions which ensure that people
can consume TV and video how and when they want it. Our solutions
deliver modern TV and video experiences every day to millions of
viewers globally, via our growing global customer base of over 500
service providers.
Aferian plc is traded on the London Stock Exchange's AIM stock
market (AIM: symbol AFRN). Headquartered in Cambridge, UK, the
Company has over 350 staff located in 11 offices, including in such
major European cities as Amsterdam, Helsinki, Copenhagen and Brno,
as well as in San Francisco and Hong Kong. For more information,
please visit www.aferian.com .
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