Xurpas swings to Q3 net loss as mobile ads unit faces challenges

XURPAS, INC. swung to a net loss in the third quarter of 2017, as headwinds in its mobile advertising segment pulled down the positive performance of other businesses.

In a regulatory filing, the listed technology firm exhibited a net loss attributable to the parent of P21.27 million, a reversal of the attributable profit of P47.62 million in the same period in 2016. Revenues for the three- month period was up 19% to P466.78 million.

Xurpas noted its mobile advertising business Art of Click faced a slowdown during the period, amid challenges in the overall industry.

“Art of Click’s business further weakened in the third quarter of 2017. A number of Art of Click’s clients are venture-capital funded firms that have not resumed running their campaigns in the third quarter. Art of Click continues to implement a recovery plan to onboard new clients and particularly to improve its client mix,” the company said.

“As a 100% subsidiary, the full effect of the consolidation of Art of Click’s decreasing revenues, operational expenses, and depressed net income was realized in the nine months of 2017,” Xurpas added, without providing details.

For the nine months ending September, Xurpas’s revenues reached P1.68 billion, up 49% year on year. This increase however failed to sustain the company’s earnings growth due to nonrecurring expenses of P48.1 million spent for the consolidation of Art of Click as well as the company’s efforts to increase manpower and resources.

With this, net income attributable to the parent ended 41% lower to P87.46 million during the January to September period.

“While we continue to expand our portfolio of mobile games, we see the future remains in becoming a platform company. Despite some headwinds, this is still our long term vision for Xurpas, and we will continue to work towards this goal across all our companies,” Xurpas President and Chief Executive Officer Nico Jose S. Nolledo said in a statement. —