Crowd Media trims losses as business transformation advances
Crowd Media says its strict cash management program has enabled a financial turnaround in FY2022.
Social commerce company Crowd Media (ASX: CM8) is celebrating the significant financial and operational turnaround it has made as it wraps up a three-year business transformation process with the commercialisation of its Talking Head platform.
The company undertook a major restructure in 2019 to move its focus to the field of conversational artificial intelligence (AI).
The three-year strategy flagged the 2022 calendar year as the year of commercialisation for its Talking Head platform, and this stage was reached ahead of schedule with first revenue recorded in April through its partnership with PangeaMed. Since then, two more commercial agreements have been signed with SourceFlare and Impssbl.
In the company’s annual report released today, Crowd chairman Styze Voulon said $5.4 million in revenue was generated over the 12-month period ended 30 June, with positive operating cash flow of $10,000.
An almost $1m improvement in underlying EBITDA loss
Mr Voulon highlighted the company’s strict cash management regime which led to an almost $1 million improvement in underlying earnings before interest, taxes, depreciation and amortisation (EBITDA), trimming the loss from $1.04 million to $50,000.
In his chairman’s letter, Mr Voulon said the company is in a much stronger financial position and gave credit to newly appointed chief executive officer Idan Schmorak, whose vision “was transformed into a clear plan with execution milestones for both tech development and commercialisation”.
“We are proud to be operating debt-free now after clearing more than $3 million of legacy debt over the past two years, which has alleviated a financial burden that enables Crowd to now focus on growth, and scaling its technology,” he said.
“Our subscription division continued to deliver its positive contribution to the group and by using our Talking Head platform, developed exciting new content. The Talking Head platform continues to gather momentum with commercial partnerships signed during FY2022.”
Mr Voulon said the company’s plan for the 2023 financial year entails rolling out Crowd’s vision for conversational AI across new verticals.
Operating through the pandemic
In his own address, Mr Schmorak said 2023 will be a period of “right sizing our teams and scaling the platform to accommodate rising demand for conversational AI solutions”, noting the impact the global pandemic has had on online activity and demand for digital labour.
“Leading a technology company, especially in times of financial uncertainty – requires constant market awareness, flexibility and agile methodologies not only in software development, but also in financial management and commercialisation,” he said.
“Crowd is well positioned with capital, technology and personnel to excel through these times the tech sector has been experiencing supported by a supportive, pro-active strong board of directors.”
Crowd ended the 2022 financial year (30 June) with $2.2 million cash on hand.