Quickflix Shares Suspended Ahead Of Potential Acquisition
The move follows Quickflix last Thursday requesting a trading halt “pending release of an update regarding a potential corporate transaction with an international party which may result in an acquisition”.
Quickflix last Friday released its June quarter report, revealing a 12 per cent year-on-year and 13 per cent quarter-to-quarter decline in paying customers, totalling 107,969. Trial subscribers for the quarter totalled 13,158, up 3 per cent year-on-year, however down 24 per cent on the previous quarter.
Quickflix noted the impact of Netflix’s arrival in the local marketplace, which it stated “was largely felt at the beginning of the quarter, underscoring the effect of the pent-up demand at the time of launch”.
“The downward momentum in the paying subscriber base and subscription streaming volumes abated towards the end of the quarter when Quickflix achieved traction in marketing and new customer additions increased,” Quickflix stated.
With consumers testing out multiple services, taking advantage of extended free trials and switching between services before committing as paying customers, Quickflix stated it “expects it will take some time for the market to settle down and for consumers to determine which service, or services, are ultimately right for them”.
Quickflix’s figures reveal a net decrease in cash held for the quarter of $349 million, following a net decrease of $858 million in the March quarter.
In May, Quickflix entered an agreement with Foxtel to distribute Foxtel’s Presto movie and TV subscription video-on-demand service to its customer base, also announcing later in the month that it had raised approximately $775,000, seeking to solidify its position in the market following the arrival of Netflix along with a number of local competitors.
The report notes the Foxtel agreement remains conditional, with Quickflix having requested an extension to address the outstanding conditions, with Quickflix adding that it “is in discussions with other third-party providers to integrate complementary niche SVOD content channels into the Quickflix platform”.
“Quickflix is looking at global opportunities to exploit its streaming platform and capability,” the report states. “Quickflix is in advanced discussions with one party in particular which may result in a corporate transaction.”