Quokka Sports Falls Short Despite Adjustments
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Citing a delay in securing sponsorship deals, Quokka Sports Inc. posted a greater-than-expected loss along with a revenue shortfall after the market closed Monday.
The digital sports entertainment provider said it anticipates a net loss of $19.5 million to $21.5 million -- far more than the previously estimated $14 to $15 million loss.
Quokka expects revenues of between $8 and $9 million, less than earlier forecasts of between $11 and $12 million. Actual results will be announced January 25.
The shortfall comes despite corporate restructuring in November, which included laying off 90 of its 460 employees and reshuffling the management deck. Alvaro Saralegui was promoted to president and chief executive officer. Other new promotions included Mark Ellis, senior vice president of sales, who now oversees all revenue for the company and Tom Newell to senior vice president of production, overseeing all of the company's sport vertical general managers.
But unlike many corporate executives who blame shortcomings on the flagging New Economy, Saralegui blamed his firm's timing in a company statement Monday.
"Our revenue shortfall was the result, in large part, of delays in the timing of sponsorships and other agreements for upcoming events, including NCAA Final Four, Golf and Major League Baseball," Saralegui said.
Saralegui also said his firm was hurt by not considering charges incurred by the acquisition of Total Sports Inc., which it picked up in July for $130 million in stock.
"While we effectively controlled our operating expenses during the quarter, we also incurred incremental unbudgeted expenses related to the integration of Total Sports," Saralegui said.
Quokka, which is trying to boost its coverage of mainstream sports, covered Olympic events online for NBC some months ago. The firm has its roots in lesser-followed sports, such as sailing, motor sports and other endurance events.