Sharechat Logo

Manji Family increases Snakk Media stake to 17%, becoming biggest shareholder

Wednesday 3rd May 2017

Text too small?

A family trust associated with Raf Manji, the Christchurch City councillor challenging Gerry Brownlee for the seat of Ilam at the next election, has become the largest shareholder in Snakk Media after buying new shares to top up the company's working capital.

The Manji Family Trust will buy 550,000 shares at 20 cents apiece, raising $110,000 and lifting its holding to 17 percent from 13.3 percent. The price is more than double the 9 cents level the stock last traded at on the NZX's NXT market. The stock has dropped 76 percent this year.

Snakk Media, which aggregates publishers' advertising space on mobile devices and matches it to demand, announced the share issue with its final business update for the year ended March 31. Under NXT rules, companies put out a series of metrics each quarter rather than the more detailed financial statements published every six months by NZX main board listed companies.

Estimated advertising revenue in the latest year was little changed at $10.6 million, from $10.5 million in the 12 months ended March 31, 2016. The gross margin slipped to 60 percent from 63 percent, the Auckland-based, Sydney-headquartered company said in a statement. Gross margin narrowed to 52 percent in the fourth quarter, which it said was "primarily due to the new Self-Service product line introduced in Q3 that has a lower gross margin than the core Managed-Service products, but also has lower operating costs associated with its delivery."

"Self-Service revenue has continued to grow as a proportion of Snakk’s total revenue since its introduction," it said. Margin was also hurt in the latest year by "increased price competition requiring Snakk to offer discounts to secure ongoing revenue," a trend that's likely to continue in 2018 and beyond.

It said revenue in its fourth quarter was lower than budgeted and combined with the timing of Snakk's return on its investments, "has resulted in a level of working capital which is less than Snakk requires to prudently manage its business." The company was pleased that the Manji Family "has shown support for the company's prospects by committing this additional capital at a value significantly higher than implied by recent market trading," the company said.

The click-through rate, which is the number of clicks on a mobile page or app advertisement divided by the number of times the ad is shown, was 0.97 percent in the fourth quarter and is running just below its full-year target of 1 percent.



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares up 1%, led by Fisher & Paykel, Kathmandu, Spark
NZ dollar heads for 2% decline as resurgent US yields stoke greenback demand
Former Abano shareholders ordered to pay $429k in disputed takeover costs
Seeka shareholder Farmind to cut stake to reduce foreign ownership
Summerset opens Melbourne office as it looks to Australia for growth
Lees-Galloway signals broader health & safety targets in draft strategy
Veritas in refinancing negotiations as ANZ extends debt for a fourth time
ComCom embarks on fibre study to get a handle on looming new policy framework
NZ posts first trade deficit for March month in 10 years as fuel imports surge
NZ log export market picks up after slowdown ahead of Chinese New Year, traders optimistic

IRG See IRG research reports