CUPID, the Edinburgh-based online dating group, has reported "significant progress" in its recovery, but admits facing pressure from the new breed of mobile dating apps such as Tinder and Lovoo.
Ahead of its annual meeting in Edinburgh yesterday, at which the only shareholders present were four directors of a six-man board, Cupid said it expected a first-half net loss of £3 million, lower than expected. Revenue, however, would be below forecast at around £7m. Close management of costs meant cash would be about £11m. Cupid reversed last year from a £4.2m profit to a loss of £2.8m.
The company said: "The dating market continues to report growth and our strategy of focussing on niches remains a strong option. There is however increasing pressure from the advance of a new breed of more intuitive, mobile, social dating applications. We continue to develop our core offering."
Phil Gripton, chief executive, said after the meeting: "The first half of the year is about fixing everything, the second half is about accelerating."
He said Cupid would test the pay-as-you-go model used by German-based Lovoo when it launched Uniform Dating in August in the US.
"The market opportunity is 10 times what it is in the UK," he said. Uniform Dating has also gone live in Australia, while the recent UK launch of the over-50s product Lovebeginsat.com will be followed by a US launch on July 1.
Cupid.com attracted over 12,000 new active users in the UK, and over 20,000 in the US, in the first month after its redesign and relaunch.
Mr Gripton said Cupid had now joined the Online Dating Association, alongside the likes of Match.com and Guardian Soulmates, after "re-engineering our products and approaches so we can be absolutely compliant" with the ODA's code of practice.
He said plans to move into 'data adtech' - selling anonymous customer data - and digital services, were on track and would contribute revenue this year.
Cupid was promoting itself as a brand in the US, and had featured as co-sponsor of a New York movie premiere, while Lovebeginsat.com was using TV advertising, Mr Gripton said. adding: "We have been very good at cost controls, making sure we are spending money in the right places and scaled to the size of business we are."
Chairman George Elliott said: "The past 12 months have been challenging but we believe that Cupid has a bright future in building a digital services business based on robust core dating assets and unique first party data. Much work has been carried out in the past six months to drive a successful turnaround of the core dating business, and the board is confident that it is making significant steps towards our long-term vision."
He said the ODA endorsement was "further independent recognition of the high quality of our much improved, customer-focused approach".
Cupid shares edged up to 41.62p, just above their all-time low, valuing the business at just under £30million. Kestrel Opportunities has recently taken its stake to 17 per cent, while co-founder Bill Dobbie, who stepped down as chief executive at the beginning of this year but remains on the board, has over 20 per cent