Technology group Altron\u2019s failed Altech Node video business has cost the company millions, according to its half-year results.<\/p>\n
Last month, the Johannesburg listed Altron announced that it was closing its Altech Node business with subscribers set to be switched off at the end of October.<\/p>\n
The Altech Node – which launched in September 2014 – was a satellite-connected box that delivered video on demand content in high definition to subscribers. The Node also supported other features such as home security and internet calling.<\/p>\n
But last month Altron said the uptake of the product and service had \u201cnot met expectations\u201d.<\/p>\n
And in the company\u2019s interim results for the period ended August 2015, more detail was provided about the failed project.<\/p>\n
\u201cDuring the period intangible assets amounting to R44m were fully impaired, related to the closure of the Altech Node,\u201d said the company on Wednesday.<\/p>\n
In Altron\u2019s segment analysis, it was further revealed that in terms of earnings before interest, tax, depreciation and amortisation (Ebitda), Altech Node registered a negative value of R75m for the six months ended August 31 2015.<\/p>\n
For the 12 months to February 28, 2015, Altech Node generated revenue of R19m but a negative Ebitda of R114m.<\/p>\n
\u201cUnfavourable market conditions, such as the current economic environment creating pressure on the consumer, together with increased competition in the video-on-demand (VOD) environment resulted in insufficient subscribers for the business to be viable,\u201d said Altron in its interim statement.<\/p>\n
Meanwhile, the Altech Node\u2019s failure is not Altron\u2019s only business segment to shutter.<\/p>\n
Altron has described Altech Autopage and Powertech Transformers as discontinued operations. The company is busy finalising a deal to sell Autopage’s subscriber base.<\/p>\n
Together with Altech Node, these businesses \u201cshowed a significant decline from the previous corresponding period with Ebitda dropping from a profit of R54m to a loss of R99m\u201d.<\/p>\n
Altron\u2019s total operations were also hit hard as revenue for the period decreased by 7% to R13.3bn and Ebitda fell by 69% to R241m.<\/p>\n
Fin24<\/a><\/p>\n The Node is dead \u2013 Altron to refund customers<\/a><\/strong><\/p>\nMore on the Node<\/h3>\n