XLMedia has said it now anticipates its 2019 earnings will take a hit from a reduction in non-core Media activities.

The marketing services provider said it now expects revenue to be reduced by USD30 million and adjusted earnings before interest, taxes, depreciation, and amortization to be between USD6 million and USD7 million lower in 2019.

XLMedia noted that 2019 has started in line with expectations but it continues to recover from the operational and regulatory headwinds reported in 2018.

The company explained that it currently uses two principal performance marketing methods – Publishing and Media buying. Within its Publishing division, XLMedia owns informational and content-rich websites globally, while its Media buying activity focuses on paid search, display, social, mobile and in-app advertising, to drive traffic to both XLMedia’s own sites and to its clients’ sites.

XLMedia said it has identified a number of Publishing growth opportunities in North America and intends to capitalise on its existing footprint in the personal finance market across the US and Canada. The company plans to invest at least USD7 million of cash on the internal development of Publishing assets over the next three years, which will have a short-term impact on its Ebitda.

In addition, the company said it has taken the decision to proactively reduce all its non-core, lower margin Media buying activities which are not complimentary to its Publishing activities.

This will result in a one-off impairment of between USD11 million and USD13 million, for 2018, mainly related to the intangible assets of acquired assets in the Media division.