Frost & Sullivan Publishes Annual Update on Vonetize

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May 08, 2019, 10:48 ET

TEL AVIV, Israel, May 8, 2019 /PRNewswire/ -- The TASE analysis project was launched in 2016 in order to raise investor awareness to TASE listed technology and life-science companies and the markets in which these companies operate, thus creating appropriate pricing and increasing the exposure of investors from Israel and abroad. Its goal is to encourage investments in these companies by improving understanding of their industries and markets.

In order to maintain professional, independent and unbiased analysis, the companies signed an agreement with TASE to receive the analysis services for an obligatory period of two years. The companies cannot withdraw from the project during this period. The analysis is funded by the companies surveyed with funding from the Chief Scientist and TASE

Summary of Highlights

The company presented a plan to increase efficiency with signs already visible in the fourth quarter report; working to increase the number of users, mainly in Brazil and Russia; target price unchanged.

The company is in a streamlining process in which revenues have not yet improved, but expenses have decreased significantly and liquidity has improved:

Revenues for the year 2018 were $ 1.23 million, compared to $ 1.344 million last year; the gross loss decreased by $ 200,000, mainly due to the decrease in cost of sales in 2018 compared to 2017, due to a real decrease in content costs due to a decrease in the Company's activity.
The net loss for the period amounted to $ 5.7 million in 2018, compared to a higher loss of $ 6.0 million in the corresponding period.
Cash flows used for operations totaled approximately $ 3.2 million, compared with approximately $ 5.7 million in the same period last year. The decrease is mainly due to the acquisition of content rights in 2017 and a decrease in the Company's needs in view of the efficiency mentioned above.

Vonetize is in the process of significantly increasing efficiency with signs of impact already seen in Q4 2018 as the company's burn rate decreased to $120,000 a month from about $235,000 a month.

The company is now trying to increase its revenues mainly in the markets in which it operates - Brazil and Russia. The company, according to its management, has completed integration of the system with a customer in Brazil and has signed a distribution agreement with several cellular operators in Brazil and therefore user growth is expected. In the background, the company signed a financing agreement for its marketing plan.

In light of the developments described above, we reduce the value of the company to NIS 32 million (approximately USD 9 million); target price now ranges between 0.67 NIS to 0.92 NIS and on average is 0.79 NIS.

Read the full report here.

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About the company - Vonetize PLC (hereinafter: "Vonetize" or "the company") offers video on demand (VOD), over-the-top (OTT) content services, and technology platforms as fully-managed services for set-top boxes, smartphones, smart TVs and other Internet-connected devices. The company offers multiscreen end-to-end video content solutions including premium content from Hollywood studios and cloud-based digital video delivery of live and VOD content. Additionally, content management, billing, CRM, and marketing/business intelligence (BI) analysis systems are offered. Headquartered in Israel, the company is also active in Latin America, Africa, and Europe. Vonetize has been listed on the Tel Aviv Stock Exchange since July 2016. It was established and incorporated in Cyprus as Pixelate T.V. Ltd. in April 2011, and rebranded in February 2016. Please click to learn more: https://ww2.frost.com/research/equity-research/vonetize-plc/

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants. For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community.

SOURCE Frost & Sullivan