Shares in Getmobile lost more than 7 per cent in London yesterday as the company's first-half operating loss widened to €550,000 from €70,000 a year earlier.
The group, which adopted the name Getmobile following the acquisition of the company in August 2005, racked up a pretax loss of €54.4 million following a review of goodwill relating to the deal.
Due to the disappointing performance of Getmobile, which is not now expected to achieve the levels of growth and profitability expected at its acquisition, the group has written down its goodwill to €9.2 million. This resulted in a non-cash charge of €53.97 million, driving the company's after-tax loss to €54.8 million.
Shares in the company, which is listed on London's Aim market, lost 0.5 pence (€0.074), or 7.4 per cent, to 6.25 pence amid uncertainty about the outlook for the company. On Dublin's IEX, where the shares also trade, they were unchanged at €0.09.
"Given the seasonal reliance on the fourth quarter and ongoing market disruption, it is difficult to assess the full-year prospects at this time," Getmobile chairman Pierce Casey, said.
However, he said the company expected "continued profitability" and said it remained confident in its business model.
In the short-term, Getmobile plans to focus on trading profitably in its existing business and improving its products and sales channels.
In the medium term, it believes its low-cost, largely outsourced business model can provide the basis for distributing a wider range of products through internet, print and television.
But the interim results highlight the immediate challenges facing the company. Difficult market conditions saw a decline in contracts sold from 67,491 in 2005 to 57,065 in the first half of 2006.
