Unhappy anniversary looms as money streams out of Aferian

The severity of the situation was brought home as the company published its results for the year to November 30, 2023. Total revenue was almost halved; it slumped 48 per cent to $47.8 million while the statutory operating loss soared 284 per cent to a $63.8m deficit.

Aferian ended the year with net debt of $6.1m as opposed to cash of $4m the previous year - a fall of 252 per cent - following a massive slump in device sales. It will come as no surprise to the beleaguered shareholders that no dividend is being proposed this year.

Adding to the instability, a review of the composition of the board is underway and, as previously reported, CEO Donald McGarva is leaving after 14 years at the helm.

McGarva said sales of Pay TV streaming devices in the year were significantly lower than the prior year at $21.3m, representing a decrease of 68 per cent; he said that, while the video streaming device market continued to grow - particularly in the Enterprise Video and Digital Signage sector - the number of Pay TV devices shipped in the period was impacted by customers de-stocking in response to reduced lead-times and a more challenging competitive environment.

"This downturn within the Amino division's revenues has had a significant impact on group results for the year resulting in a significant impairment to goodwill and intangible assets," he said.

McGarva nevertheless struck an upbeat note in a spot of future-gazing. He said swift action was taken to stem the losses and Aferian secured additional cash funding through a $1.3m loan arranged by the group's largest shareholder last May.

The group raised $4m before expenses near the end of July, through an issue of equity share capital to be used for general working capital purposes.

In April of this year Aferian secured an extension to its $16.5m senior lending facilities to September 2025 as well as an extension to the $1.3m term loan arranged by its largest shareholder Kestrel Partners LLP to January 2026.

McGarva said securing these extensions, combined with the management actions taken to streamline operations in the last 12 months "now provides a stable financial platform on which the group can move forward."

Shareholders in the AIM business apparently prefer to maintain a watching brief through the rest of 2024.

Headquartered in Cambridge, the company still has over 350 staff located here and in offices in San Francisco, Amsterdam, Helsinki, Copenhagen, Madrid, Porto, Brno, Buenos Aires and Hong Kong.