Aferian to cut costs on lower Amino sales

Source: Alamy.com

TV technology outfit Aferian is looking to cut US$3 million in costs from its Amino division as the result of a deterioration in the trading environment.

The group now expects revenue and adjusted EBITDA for the year to November 30 2023 to fall at the bottom of the range forecast in December.

On December 5, Aferian reported that it expected to report revenue of approximately  US$47-48 million and a positive adjusted EBITDA of approximately US$1.6-2.6 million for the year.

Aferian said its 24i video streaming business was making good progress with key new customer deployments and multiple contract extensions being delivered in the first quarter.

However, it said there had been a further deterioration in the trading of the Amino business due to lower than expected orders for video streaming devices as customers had delayed purchasing decisions longer than anticipated.

The decision to implement annualised cost reductions of about US$3 million in the Amino business comes after the group took action to lower its annualised cost base by approximately US$12 million last year.

As a result of the deterioration of Amino’s current and forecast trading, Aferian no longer expects group adjusted EBITDA for FY2024 to be higher than FY2023.

Aferian is in advanced discussions with lenders over a maturity extension of its banking facility, which has now reduced to US$16.5 million from US$25.4 million and matures in November.

Aferian expects to report its full year audited results in May.

Mark Wells, chairman of Aferian, said: “In the face of unprecedented challenges, this last year has thoroughly tested the resilience of the Group. However, our 24i video streaming business has made good progress this quarter and I am confident that the timely management actions taken in the last twelve months have positioned the Group on the strongest possible foundation for the future.”