Quickflix slashes staff and restructures debt as Aussie SVOD player attempts to stay afloat
Australian streaming video on demand (SVOD) Quickflix has moved to slash staff, reduce costs and restructure its debt obligations as it seeks to avoid running of cash.
The local streaming player which has long been beset by financial problems went into a trading halt back in August as it attempted to head off potential insolvency, has announced a restructure which sees it slash 20 per cent of its workforce – thought to be around 15 staff – and cut costs by more than $4m a year.
Quickflix, which has debts of more than $6m in licensing arrangements to the major movie studios, also noted that it had restructured some $2m of that debt and received “in principle” agreement with three other studios for the other $4m.
The company also told the ASX it had “reached agreement to enter affiliate arrangements with SVOD operators in Australia and New Zealand whereby the company will introduce a SVOD offer to its customers and derive a fee for signups to that offer.”
It did not list the Australian SVOD players it had made the deal with, but it is understood that neither Stan nor Netflix has made a deal with Quickflix. Presto at the time of publishing had not responded to questions about whether they had made a deal with Quickflix.
Earlier this year, Quickflix was forced to abort its deal to become a reseller of rival Presto’s service when it was unable to meet the requirements imposed on them by the SVOD service, instead choosing to sign a deal with an unnamed Shanghai-based film and television company which also subsequently had to be aborted.
The company, which in its last market update on June 30 reported it had lost $1.096m in the last quarter and had only $913,000 in cash on hand, also noted it had lodged its 2015 tax return which included a research and development rebate of $660,000 which “will be applied to ongoing working capital requirements.” It also signalled it was in discussions with investors for a new injection of capital.
Quickflix also asked that it remain in voluntary suspension until the restructure was complete and it had lodged its outstanding June 30 financial statement.
At the time it was suspended the shares were valued a $0.001 giving the company a market capitalisation of just $2.2m.
Nic Christensen
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