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Phorm Cuts Costs and Losses
Behavioural ad targeting company Phorm has reported a 40% drop in operating loss to $29.7m from $49.8m last year, following positive foreign exchange caused by the appreciation of the US dollar against sterling.
 The figure has also been helped by a series of cost reduction exercises which have resulted in a 13% reduction in staff, lower property rental costs, reduced expenditure on marketing and communications, and lower fees for professional advisors.
For the six months ended 30 June 2009, Phorm reported an operating loss (before non-cash share-based payment charges) of $12.3m, and in the second half of the year $14.0m. (The total loss also includes a non-cash share-based payment charge of $3.5m).
During 2009, the company undertook an equity fundraising exercise, resulting in a cash inflow of $23.4m, net of expenses.
Back in 2007, the firm found itself the subject of some unwelcome publicity when BT used business customers' data without permission, in a trial run for its 'Webwise' software.
Phorm has now re-branded the software as Navegador, and launched it in Brazil in partnership with telecoms group Oi. The tool enables users to present consumers with personalised content on participating web sites, once they have opted in.
As an additional cost-cutting exercise, Phorm has moved some operational activities out of the UK to Brazil, to bring them closer to its existing market and to access the 'lower cost base' in South America.
'As a management team, we are pleased with the progress that has been achieved during 2009 and 2010 to date and recognise the contribution and dedication our employees have shown in readying the group for the next stage in its development,' says founder and CEO Kent Ertugrul.
'We expect the pace of deployment in Brazil to increase rapidly during the second half of 2010 from the existing modest coverage of subscribers, and to begin serving revenue-generating ads in the coming months.'
Web site: www.phorm.com .
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