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SyQic

  • BY: Andrew Hore |
  • POSTED: 14/11/2016 |

SyQic, the provider of video content over mobile devices, has ended takeover talks with its management team. 

The independent directors could not agree a suitable price with the bidder. Meanwhile, slow payments by debtors have led to a shortage of cash in the business. SyQic is trying to raise finance following the audit qualification of its 2015 accounts, which were released at the same time as the 2016 interims. The chief executive, who was involved in the potential buyout, has leant £612,000 to the company.

In the six months to June 2016, SyQic edged up its revenues to £6.2m, while the pre-tax profit jumped from £1.37m to £2.1m. Net cash from operating activities improved from £400,000 to £542,000. There was a cash outflow for 2015 as a whole. Net cash was £408,000 but there was £867,000 due to directors and shareholders.

There is increasing competition in the Asian markets but the big problem is that mobile telecoms clients are slow in paying. One particular, client has agreed payment plans on more than one occasion but it has not kept to them for long. By the end of June 2016, trade receivables were £11.3m, compared with 2015 revenues of £11.7m. At the end of 2015, there was £6.6m of payments that were charged more than 12 months earlier. That has been reduced to £800,000 and £400,000 of this is the subject of an impairment provision. Money owed from 2015 will be paid in 2016 and 2017.

Trading in the shares was suspended on 28 June so the financial situation has to be sorted out before the end of this year or the quotation will be cancelled. 

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