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Plexure to cut workforce by a quarter

NZN 30/06/2017 Paul McBeth

Plexure Group, the digital advertising firm formerly called VMob, plans to trim its workforce by more than a quarter in an effort to generate positive cash flow by the end of the year.

The Auckland-based company will cut nine permanent jobs and six contract staff from its 55 strong workforce from August in a restructure as the digital ad firm's product development stage ends and it sees growing demand for professional services.

From August, Plexure will operate in four streams: sales and account management, core product development, professional services, and administration.

"Along with architectural advances leading to a more efficient use of costly cloud resources, this organisational restructuring will enable the company to accelerate its move towards profitability," chief financial officer Andrew Dalziel said in a statement.

"The company is confident that the reduction in operational headcount will have minimal impact on its ability to deliver high quality services for its current customers and to meet its 2017 sales targets."

Plexure narrowed its annual loss to $6.5 million in the year ended March 31 from $6.6 million a year earlier on an 11 per cent gain in revenue to $7.3 million.

While its staff wage bill fell 10 per cent, or $668,000, to $5.4m in the year, it spent $720,000 on contractors, up from $408,000 a year earlier.

Chairman Philip Norman said Plexure's revenue growth was slower than preferred in the 2017 financial year, but that he expected it to accelerate in 2018 "as our penetration of existing customers deepens and new customers are acquired".

The company's shares last traded at 9 cents and have slumped 72 per cent so far this year. That values the company at $8.3m.

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