Monitise shifts strategy as revenues dip
06 July 2015 | 4251 views | 0
Montise says it will attempt to steer its customer base away from customised mobile banking platforms to standardised deployment of cloud-based API and on-premises products as it bids to get the business back on an even keel.
The shift in strategy comes as the UK mobile banking firm issues a trading update for the full year to 30 June, which shows a dip in revenue year-on-year to £88-£90 million from £95.1 million in the previous period.
Despite the disappointing numbers the company - which recently took itself off the market following a failed search for a third-party suitor - reiterated its full year 2016 Ebitda profitability target.
CEO Elizabeth Buse says: “We have delivered a solid revenue performance in what has been a difficult year. Across the business, our cost disciplines have improved, we are taking the necessary tough decisions and our path to profitability is on track. Central to our growth plans is our new API-based platform launched in April, we have been delighted with its technical capability and the reception it has received from clients, which gives us confidence for the future.”
The majority of the company's existing customers operate on expensive-to-deploy purpose-built platforms customised to their particular needs.
Buse says that Monitise will work with its clients and partners to "improve and optimise the financial performance of this business line", by enabling existing customers to move to the the new cloud-based platform.
The company says it expects to report reduced losses for the full year, as operating and capital expenses are cut. Gross cash at 30 June 2015 of £88.6m shows a material reduction in H2 cash outflows over H1 and provides enough ballast to get the company to its breakeven target deadline.