2ergo bullish despite surge in losses
MOBILE technology group 2ergo has reported a surge in half-year losses after what it described as a “transformational” period.
The Salford Quays-based company said it expects to continue to make losses while it rolls-out new products and technolgies.
After selling some of its loss-making international businesses the group’s revenue in the six months to the end of February was £4.7m, compared with £6.5m in the same period in 2011.
Losses leapt three-fold from £1m to £3.6m at an operating level and at pre-tex leve from £1.1m to £3.7m. Including discontinued operations the total bottom-line loss was £8.7m.
The company said that it had launched a strategic review in the second half of 2011 and having cut its cost base, is now in growth mode once more.
Chief executive Neale Graham, said: “”This has been a transformational period for the group, paving the way for the launch of our very exciting podifi technology. We now go forward with an extremely focused business model which is already surpassing our predictions.
“We are pleased to see the significant experience gained from our work with Orange Wednesdays, the PizzaExpress PayPal partnership and 3M and Wendy’s in the US manifesting itself in the launch of podifi our contactless couponing, loyalty and payment platform.”
2ergo said it is now focused on three business areas: podifi a contactless mobile technology aimed at large retailers and businesses; TikTap – a product based on the podifi platform, but aimed at SMEs, local commerce and hospitality outlets; and Customer Insight Services, which provides major brands with data and customer insights derived from consumer and retail activity.
It said management had made “made positive and significant change” in the last six months and the business now has clear focus and direction.
The TikTap product has already secured partnership agreements with local government, retailers, business forums and town and city centre management groups to create a network of local couponing and loyalty programmes.
This will become the first UK-wide network of independent retailers, bars and restaurants delivering sustainable mobile offers under a single brand.
The first programmes for TikTap will launch this month in Preston, Southport and Skegness, closely followed by Salford and Blackpool.
Visitors, residents and shoppers in these areas will benefit from redeeming highly targeted and valuable local offers and deals through an installed network of podifi pods in and around those towns and cities.
From a financial outlook ergo said its expects loss generation to continue in the second half of this year as podifi and TikTap are launched commercially.
“Revenue growth and a return to profitability are expected for FY13, with monthly EBITDA profits forecast from the end of 2012.”
