The future looks pretty bleak. The former AIM stock pin-up Blur (BLUR:AIM) is now very much in a battle for its very survival, and the runes don't look promising. Results for the six months to June 2016, with revenues down nearly two-thirds to just $0.6 million and gross profit of $349,000 this time last year have completely evaporated, leaving the company nursing an $11,000 loss.
Costs have been rightly attacked with gusto slashing the losses before interest, tax, depreciation and amortisation (LBITDA) by 54% year-on-year while cash burn is also sharply down, cut by 58%. But that still leaves a gaping $2.9 million pre-tax deficit while chomping through $2.1 million of cash, cutting what's left in the bank from $7.1 million to $4.3 million.
These are figures that the market simply shrugs off, the share price unmoved at 7.12p, for a piddling market cap of just £3.36 million. This is a business that floated on AIM in October 2012 at 82p per share, and at their 792.5p peak (Jan 2014) Blur was valued at around the £350 million mark.
Blur, which runs a technology platform matching service providers with potential buyers, last year switched focus to concentrate on enterprise customers rather than individual contractors, and there are some signs of hope, particularly in the US. A few large early stage projects are on the go across the pond with four new enterprise customers secured during the half to 30 June. These include an IT systems integrator and a multi-national real estate firm, plus in the UK a law firm and a UK-based multi-platform media organisation.
All have the potential to bring home the revenue bacon down the line, but will it be quickly enough to stave off the alternative?
'Put simply, we do not believe that Blur’s business is viable in its current form,' Megabuyte's Ian Spence bleakly assesses. 'As fast as the management team can cut costs, revenues just fall faster. While it does seem that revenue might stabilise somewhat in the second half, Blur would still need to cut its cost base again by three quarters, just to break even on that level of revenue. It really is difficult to see a long term future for the company.'