Dutch analytics vendor Brainpower is exploring additional funding options as it reports a 23% slide in sequential revenues for the first three months of 2003.
Revenues for the quarter ended 31 March, 2003 equaled €1.4 million, down from €1.8 million in the previous quarter. This reduction was largely attributable to a number of contracts that expired in the second half of last year and were not renewed, particularly from clients in the e-brokerage sector, says Rocco Pellegrinelli, chairman and chief executive officer of Brainpower.
"Going forward the weakness from this customer segment will have minimal impact on our revenues, as our exposure to e-brokerage business is now very small," he adds. "Most new customers acquired in the first quarter were buy-side institutions, and in total, new business represented annual contract value of €445,000."
EBITDA losses before restructuring costs were €1.59 million in the first quarter, showing an improvement of 10% from the corresponding period in 2002. Net losses were €1.9 million for the quarter, of which €65,000 were related to restructuring costs. This compares to net losses of €1.6 million in the fourth quarter, of which €170,000 related to restructuring costs.
During the quarter Brainpower implemented a new plan to further develop third party sales and marketing channels and recruited Hammad Nasar from Booz Allen Hamilton to lead the initiative.
The company burned through €1.2 million cash in Q1, ending the quarter with cash and cash equivalents of €3.9 million. Brainpower says this should be sufficient to fund operations until the company reaches EBITDA breakeven. The company is, however, exploring additional funding options "in case business opportunities should require additional capital".