The
fallout from the Chinese clampdown on miss-selling of wireless services
continues to drift westward. London-listed IGM, which provides wireless
value-added services in Asia, today reported a year-on-year decline in
interim revenues of 5% to $2.7m.
To be fair, a 32% slump in revenues from Taiwan was largely to blame for IGM's depressed top line. In China, which is the main market for IGM's messaging services, it actually managed to report a small year-on-year increase in revenues of 3.6% to $2.2m, despite the clampdown -- see this EngagingChina story for more on China Mobile's restrictions on wireless services.
Nevertheless, 3.6% is the sort of sluggish growth we expect from plodding old industries like metal bashing or cement making, not from young hi-tech sectors like wireless value-added services (WVAS), and least of all when the market concerned is China.
The company is apparently not out of the woods yet as the regulatory changes, introduced in the summer, will also impact its full year's results. Philip Wong, CEO Executive Officer of IGM said:.
The policy changes are leading to new market challenges in the second half and will have a significant adverse impact on our marketing and expansion strategy in China."
That is not the sort of announcement that investors like to here, particularly when it accompanies your maiden results as a public company -- IGM was admitted to London's AIM market in May, when it raised $12m.
