Media monitoring group Isentia is closing its loss-making North Asia operations.
Isentia has entered into a strategic alliance with Wisers Information, a provider of business intelligence solutions based in Hong Kong. Clients of Isentia in Beijing, Shanghai, Hong Kong and Taiwan will transition to Wisers.
At the same time, Isentia has reached agreement to sell its stake in its Korean business to its local partner.
The exit is expected to result in one-off net closure costs of $3 million to $4 million. There may also be a non-cash impairment against the carrying value of the North Asian assets.
Isentia CEO Ed Harrison says the decision to exit North Asian markets reflects strategic focus on building regional scale with a single platform.
"The exit streamlines our business and clears the path for innovation to reach all our markets simultaneously," he says.
"The strategic alliance with Wisers represents a unique opportunity to transition our clients to a leading local business intelligence provider and to explore the possibility of further collaboration in other regions.”
Isentia remains committed to its South-East Asian markets where it is a leading provider of social media analytics and has close partnerships with local and multi-national clients. Harrison says revenue in South-East Asia, unlike North Asia, is highly recurring and continues to record strong growth.
Isentia expects underlying EBITDA (earnings before interest, taxes, depreciation, and amortisation) in the 2020 financial year to be between $20 million and $21 million.
"Although COVID-19 has disrupted many of our customers’ operations, the essential nature of Isentia’s products and services, especially during a crisis, has mitigated the impact of the pandemic on the business," says Isentia.
"Isentia has also benefited from the early implementation of cost saving measures as well as the acceleration of existing cost management programs."
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