blinkx sees bigger picture as profits fly
Video may have killed the radio star but it is doing wonders for one of Britain’s emerging technology companies.
blinkx, a video search engine, reported a 73 per cent rise in revenue for the year to March to $198 million (£129 million) while pre-tax profit soared nearly 800 per cent to $16.7 million. Its cash position also swelled 45 per cent.
The results beat expectations set only three weeks ago when it issued a well-received trading update. It said in February that it expected revenue of $180 million which was then 10 per cent more than expected.
Shares in the company, a spin out from Autonomy, have almost quadrupled since last August and added another 5.6 per cent, or 6p, to 113p after the results.
blinkx has also benefited from a switch at the top as Suranga Chandratillake, founder and chief executive of the company, switched roles with Subhransu “Brian” Mukherjee, his chief operating officer.
“Several structural trends are fuelling the growth of the online advertising industry in general, and the video advertising sector in particular. These include widespread broadband adoption, the proliferation of connected devices and the rapid migration and consumption of video content online – all of which are prompting advertisers to follow audiences online,” said Mr Mukherjee.
The company benefited from the Olympic Games and the US Presidential Elections which drove more people online and onto its web site.
“These are exceptional results by any measure. It is clear that the business is well positioned to take advantage of rapid structural growth in the wider online advertising market but the new management team has done an excellent job of execution and integration,” said Jonathan Imlah, an analyst at Cannacord Genuity.
Hewlett-Packard, which acquired Autonomy and has since accused Dr Lynch of inflating the value of the business, inherited a residual stake in blinkx of about 10 per cent. Dr Lynch also holds a 6 per cent holding in the business.