17 July 2020
By Maynard Paton
Results summary for System1 (SYS1):
- Somewhat academic annual figures that showed pre-AdRatings profit down 27% due to weak trading prior to Covid-19.
- The pandemic has since caused demand for SYS1’s services to drop 38% and created pre-tax losses.
- AdRatings continues to generate minimal revenue at significant cost, although the tie-up with ITV suggests the fledgling service has some inherent value.
- SYS1 bizarrely remains very poor at marketing its own services. A flagship company film commences with references to 18th century German literature.
- A £3.9m cash buffer ought to keep SYS1 afloat as it moves towards more reliable revenue sources. Valuation in the meantime remains anyone’s guess. I continue to hold.