Interim Results
Mobile Streams plc
19 September 2006
19 September 2006
Mobile Streams Plc - Maiden Interim Results Announcement for the six months to
30 June 2006
Financial highlights:
- Revenue increased 67% to £3.4m (2005: £2.0m).
- Revenue growth in North America and Latin America of 216% and 157%
respectively versus same period 2005
- Operating Loss £1.9m (2005: (£0.1m))
- Trading EBITDA loss* for the period was (£0.3m) (2005: (£0.1m))
- Cash at 30 June 2006 £6.1m (2005: £0.26m)
*Calculated as profit before tax, amortisation of goodwill, depreciation, share
compensation expense and fund raising and floatation costs
Operational highlights
- Mobile Streams is now a global business with presence in UK, Europe, Asia
Pacific, North America and Latin America
- Successful implementation of acquisition strategy to extend distribution
and enhance content offering
- New revenue agreements with Vodafone Ireland, Vodafone Australia, Vodafone
New Zealand, CSL Hong Kong, Comcel Colombia, Movistar Chile and Alltel, the
5th largest operator in the US
- Successful commercialisation of technology platform Vuesia
- Strategic investment from Liberty Media in January, purchasing 22% of
Mobile Streams' shares
- Completion in February of Placing and Admission to AIM.
Commenting on today's inaugural interim results, Mobile Streams Chairman Roger
Parry, said: 'Mobile Streams has set itself the goal of being one of the world's
leading 'mobilisers of media' and we feel we have made good progress to this end
over the past six months. I am sure we will consolidate these achievements going
forward. Therefore, the Board is confident of a satisfactory outcome for the
year and believe that we are creating shareholder value for the future'.
Simon Buckingham, CEO of Mobile Streams, added: 'In the first half of 2006,
Mobile Streams has put in place solid foundations which will enable the company
to fully participate in the growth in the mobile phone content and services
market that we expect in the coming months and years. The year to date can be
characterised by some well timed acquisitions to enable Mobile Streams' growth
to continue as demand for mobile media grows'.
Enquiries:
Mobile Streams
Simon Buckingham, Chief Executive
Jitesh Sodha, Chief Financial Officer
Brunswick Group LLP
Tim Burt Telephone: 020 7404 5959
Chairman's Statement
In our first six months as a listed company we have delivered on the objectives
set out at the time of the IPO.
Mobile Streams has put in place the financial and business building blocks that
will allow us to capitalise on the growth of mobile media during 2007 and
beyond. Revenue grew to £3.4m, up 67% on the same period in 2005, whilst Trading
EBITDA* losses were £0.3m (2005 (£0.1m)). The cash balance as at the end of the
first half was £6.1m.
The first half of 2006 has seen Mobile Streams transform from an unlisted UK
business, which funded itself out of cashflow, into an international operation
with cash reserves. The company came to market in January 2006 with a listing on
the AIM market, in the process being supported by a major strategic media
investor in Liberty Media. Since then, the company either further developed or
established operations in the UK, North America, Latin America, Europe and Asia
Pacific.
Growth is coming from three key areas:
- Additional content and distribution
- Licensing of Vuesia, a proprietary technical platform
- 'Bolt-on' acquisitions, which add distribution, exclusive content and
management talent.
Growth in a growing market
The first six months as a listed company have seen Mobile Streams develop the
business with new content and distribution deals and leverage the relationship
with Liberty Media and its subsidiary Connectid. We also strengthened our Board
with the appointment of Mark Carleton, a senior Liberty Media executive, as a
non-executive director.
Mobile Streams has completed a number of complementary acquisitions this year.
Our acquisition strategy is to find entrepreneurial businesses to 'bolt-on'
where they can add specific value to our content and/or distribution. The
success of this strategy is evident in the three acquisitions completed, two of
which were with companies where we had existing business relationships, allowing
us to identify a suitable cultural and management fit. This approach reduces the
risk of the acquisitions and has enabled swift integration.
Outlook
With these developments in mind, the Board look forward to a satisfactory
outcome to the year in line with our expectations at the time of the IPO and
remain confident of creating shareholder value for the future.
Chief Executive's Statement
Our business has three main components: Mobile Distribution, Mobile Content and
the proprietary Vuesia Platform.
Distribution: Mobile Streams now has truly global distribution. Leveraging our
expertise and technology platform across multiple operating regions both
increases our return on technology investment and assists our global customers
with the implementation of their mobile strategies. Our global footprint and
geographical scale will also enable us to reduce our dependence on any one
customer or region, and facilitate our growth.
Having grown organically with subsidiaries in North America, Mexico, Brazil,
Argentina, Colombia and Chile, we have now added a presence in Germany,
distribution across mainland Europe and subsidiaries in Hong Kong, Australia and
Singapore, providing a strong base for distribution across Asia Pacific.
Our organic business has successfully developed with new distribution launches.
We now run a comedy channel for Vodafone in UK, Ireland, Australia and New
Zealand. In Latin America we have launched exclusive Playboy services in
Colombia, Mexico and Argentina. In addition we have become the white label
provider for Movistar in Chile. We have recently created a new subsidiary in
Venezuela to expand our footprint in this fast growing region still further. In
the US we have launched services on several Qualcomm BREW carriers, including
Alltel, the fifth largest US operator.
Mobilemode Limited was acquired in July 2006. Founded in 1999, Mobilemode
delivers mobile entertainment content and services to mobile phone operators and
portals in the Asia Pacific region. The acquisition of Mobilemode gives Mobile
Streams a comprehensive position in Asia Pacific, with a particularly strong
focus on Australia, New Zealand, Malaysia, Singapore and Hong Kong. In addition,
the acquisition offers Mobile Streams the immediate benefit of Mobilemode's
experienced management team, and their strong relationships in the region.
Mobilemode is currently in the process of being renamed Mobile Streams Asia.
Content: Pre-IPO, Mobile Streams had organically developed a strong position in
the UK and Latin America. However, we believed that we needed to strengthen our
existing North American business to take full advantage of this sizeable market,
and add significant scale to our embryonic Asian and European businesses. This
led to the three transactions we have completed post IPO and positions the
company well for growth across multiple regions.
We acquired Cyoshi Mobile GmbH in April 2006. Based in Germany, Cyoshi is a
leading independent producer and distributor of mobile media - especially video
content - across Europe. The acquisition strengthens Mobile Streams' footprint
across mainland Europe and provides us with direct access to exclusive mobile
content. Cyoshi, now renamed Mobile Streams Europe, was a supplier to Mobile
Streams, and is already well integrated into the company.
We recently launched FunkySexyCool (FSC). FSC is a social networking tool
allowing users to create profiles of themselves through their mobile and text,
flirt and vote for each other as either Funky, Sexy or Cool. The product will be
promoted by MTV across the German speaking region (Germany, Austria and
Switzerland) and by network operators including Vodafone Germany and Mobilcom
Austria. Mobile Streams has exclusive distribution rights for FSC in Europe.
We acquired The Nickels Group in August 2006. The Nickels Group was also a
supplier to Mobile Streams. The California-based mobile production company
specialises in the licensing and distribution of urban music, currently the
highest selling genre of music in the US. The deal significantly strengthens
Mobile Streams' music content generation and distribution business as well as
providing a strategic foothold on the west coast of the US.
Vuesia: We have continued to invest in our Vuesia platform. Because of its
flexibility in handling all mobile media types from text to video, Vuesia is a
single integrated technology platform. This platform is already used within the
Mobile Streams business to deliver mobile content services at a 'carrier grade'
level. We have been enhancing and 'productising' Vuesia to support the external
sales process. The recent agreement with Sony Pictures Entertainment, where
Mobile Streams has delivered mobile assets for films such as The Da Vinci Code,
is an example of where our proprietary flexible and future-proof technology is
creating links with a leading media company, as we are chosen to bring their
content into the mobile arena.
The strategic investment from Liberty Media highlights the importance of the
mobile content sector and has already resulted in the relationship with the
mobile tracking business Connectid. Since the beginning of the year, Connectid
has successfully signed several agreements with network operators, handset
suppliers and software suppliers to provide location based services.
Furthermore, Mobile Streams and Connectid have integrated their platforms so
that Vuesia also supports location sensitive mobile content and are jointly
pitching this unique offer to carriers and media companies. The relationship
between Mobile Streams and Liberty Media has exceeded the company's
expectations, with relationships established or developing with several
companies in the Liberty family.
As a result of these developments, we are strongly positioned to capitalise on
the benefits that they will bring and build on the first half of the year.
Financial Review
Group turnover in the six months was £3.35m, a 67% increase on 2005 (£2.0m).
Trading EBITDA* losses for the period were (£0.3m) (2005: £0.1m). Loss before
tax was £1.78m including fund raising/floatation costs and share compensation
expense (2005: loss of £0.1m).
The Group has applied Financial Reporting Standard 20 - 'Share Based Payment'
for the first time. This requires the recognition of a charge in the Profit and
Loss Account in respect of share options. The impact of this policy is detailed
in note 1. A prior year adjustment has not been made as the adjustment was not
material.
The Group incurred a net cash outflow from operations of £245,000 (2005: inflow
£149,000). The cash balance at 30 June 2006 was £6,143,000.
Basic earnings per share amounted to a loss of 5.75p per share (2005: loss of
0.422p restated). This reflects the additional goodwill amortisation charge in
the period and the revised treatment of share compensation expense.
Adjusted earnings per share (excluding flotation/fund raising costs and share
compensation expense) amounts to a loss of 0.86p (2005: loss of 0.42p).
MOBILE STREAMS PLC
CONSOLIDATED BALANCE SHEET
For the period ended 30 June 2006
(Unaudited) (Unaudited) (Audited)
At 30 June At 30 June At 31 December
Note 2006 2005 2005
£'000 £'000 £'000
Fixed assets
Tangible assets 907 140 247
Intangible assets 1,986 - -
Investments 165 - -
--------- --------- ---------
3,058 140 247
--------- --------- ---------
Current Assets
Debtors 1,691 983 1,524
Cash at bank and in hand 6,143 263 268
--------- --------- ---------
7,834 1,246 1,792
Creditors: amounts
falling due within one year (2,661) (1,618) (2,170)
Net current assets 5,173 (372) (378)
Provisions for liabilities and charges - - (18)
Net assets/(liabilities) 8,231 (232) (149)
========= ========= =========
Capital and reserves
Called up share capitals 65 1 1
Shares to be issued 496 - -
Share premium 9,593 100 165
Profit and loss account (1,923) (333) (315)
--------- --------- ---------
Equity shareholders' funds/(deficit) 5 8,231 (232) (149)
========= ========= =========
MOBILE STREAMS PLC
CONSOLIDATED SUMMARISED PROFIT AND LOSS ACCOUNT
For the period ended 30 June 2006
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
Note 30 June 2006 30 June 2005 31 December 2005
£'000 £'000 £'000
Group turnover 3,353 2,013 5,071
Cost of sales (1,329) (870) (2,197)
--------- --------- ---------
Gross profit 2,024 1,143 2,874
--------- --------- ---------
Flotation/fund raising costs (1,292) - -
Other administration expenses (2,631) (1,237) (2,812)
--------- --------- ---------
Operating (loss)/profit (1,899) (94) 62
Net interest 121 (9) (31)
--------- --------- ---------
(Loss)/profit on ordinary
activities before taxation 2 (1,778) (103) 31
Tax on profit on ordinary activities 28 - (159)
--------- --------- ---------
(Loss) retained (1,750) (103) (128)
========= ========= =========
Pence per Pence per Pence per
share share share
Basic earnings per share 3 (5.747) (0.422) (0.519)
Adjusted earnings per share 3 (0.857) (0.422) (0.520)
MOBILE STREAMS PLC
CONSOLIDATED SUMMARISED CASH FLOW STATEMENT
For the period ended 30 June 2006
(Unaudited) (Unaudited) (Audited)
Note 6 months to 30 6 months to 30 12 months to 31
June 2006 June 2005 December 2005
£'000 £'000 £'000
Net cash (outflow)/inflow from operating
activities 6 (1,204) 149 259
Returns on investment and servicing of finance
Net interest received/(paid) 121 (9) (31)
Taxation (124) - (47)
Capital expenditure and financial investment
Capital expenditure (813) (117) (257)
Investments in subsidiaries
(net of cash acquired) (1,375) - -
Trade investments (165) - -
Financing
Issue of share capital
(net of expenses paid) 9,492 - 65
--------- ---------- ----------
Increase/(decrease) in cash 5,932 23 (11)
--------- ---------- ----------
Reconciliation from net cash flow to movement
to net funds
Increase/(decrease) in net cash 5,932 23 (11)
Foreign currency movements (57) (18) 21
--------- ---------- ----------
Change in net funds resulting from
cash flows 5,875 5 10
Net funds brought forward 268 258 258
--------- ---------- ----------
Net funds carried forward 6,143 263 268
========= ========== ==========
MOBILE STREAMS PLC
OTHER PRIMARY STATEMENTS AND NOTES
For the period ended 30 June 2006
1 BASIS OF PREPARATION
The interim financial information has been prepared in accordance with principal
accounting policies of the Group as set out in the Group's 2005 annual report
and financial statements except for the adoption of Financial Reporting Standard
20, 'Share based payment'. The impact of this change in accounting policy has
been reflected in the profit and loss account and gave rise to a charge of
£197,000 for the period. A prior year adjustment has not been made as the
adjustment was not material. The change in policy did not result in any change
in Shareholders' equity.
2 PROFIT/(LOSS) ON ORDINARY ACTIVITIES BEFORE TAXATION
The loss/profit on ordinary activities before taxation is stated after charging:
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
30 June 2006 30 June 2005 31 December 2005
£'000 £'000 £'000
Auditors' remuneration:
Audit services 19 - 26
Other services 124 - 34
Depreciation 98 9 44
Amortisation of goodwill 17 - -
Share compensation expense 197 - -
========== ========== ==========
Auditor's remuneration for other services is in relation to tax compliance,
advisory work and acting as Reporting Accountant.
3 EARNINGS PER SHARE
The calculation of the basic earnings per share is based on the earnings
attributable to ordinary shareholders divided by the weighted average number of
share in issue during the period.
Reconciliations of the earnings and weighted average number of shares used in
the calculations are set out below.
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
30 June 2006 30 June 2005 31 December 2005
Pence per share Pence per share Pence per share
Basic and
Diluted earnings per share (5.747) (0.422) (0.520)
MOBILE STREAMS PLC
OTHER PRIMARY STATEMENTS AND NOTES
For the period ended 30 June 2006
3 EARNINGS PER SHARE (continued)
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
30 June 2006 30 June 2005 31 December 2005
£'000 £'000 £'000
Loss for the financial period (1,750) (103) (128)
========== ========== ==========
For Adjusted earnings per share
Loss for the financial period (1,750) (103) (128)
Add back: exceptional floatation/
fund raising costs 1,292 - -
Add back: share compensation
expense 197 - -
---------- ---------- ----------
Adjusted loss for the period (261) (103) (128)
========== ========== ==========
Weighted average number of shares Number of Number of Number of
shares shares shares
For basic earnings per share 30,452,061 24,298,630 24,531,997
Number of dilutive shares under
option 2,595,300 1,163,350 1,168,250
The adjusted EPS has been calculated to reflect the underlying profitability of
the business by excluding the exceptional floatation and fund raising costs.
4 STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
30 June 2006 30 June 2005 31 December 2005
£'000 £'000 £'000
Loss for the period (1,750) (103) (128)
Currency differences on foreign
currency net investments (55) (18) 25
---------- ---------- ----------
Total recognised losses for the
period (1,805) (121) (103)
========== ========== ==========
MOBILE STREAMS PLC
OTHER PRIMARY STATEMENTS AND NOTES
For the period ended 30 June 2006
5 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to 12 months to
30 June 2006 30 June 2005 31 December 2005
£'000 £'000 £'000
Loss for the period (1,750) (103) (128)
Other recognised gains and losses (55) (18) 25
Issues of shares 9,492 - 65
Share compensation expense 197
Shares to be issued 496 - -
---------- ---------- -----------
Net increase/(decrease)
in shareholders' funds 8,380 (121) (38)
Shareholders' funds at
1 January 2006 (149) (111) (111)
---------- ---------- -----------
Shareholders' funds at
30 June 2006 8,231 (232) (149)
========== ========== ===========
6 NET CASH (OUTFLOW)/INFLOW FROM OPERATING ACTIVITIES
Operating (loss)/profit
before tax and interest (1,899) (94) 62
Depreciation 98 9 44
Amortisation of goodwill 17 - -
Share compensation expense 197 - -
Decrease in debtors (167) (337) (877)
Increase in creditors 550 571 1,030
---------- ---------- -----------
Net cash (outflow)/inflow from
operating activities (1,204) 149 259
---------- ---------- -----------
GEOGRAPHICAL & BUSINESS ANALYSIS
UK/Asia/Europe
----------------------- ------------ ------------ ----------
Six months ended 30 June 2006 30 June 2005 % change
£'000 £'000
Turnover 1,494 1,362 10%
Gross Profit 895 720 24%
Gross margin 60% 53% 13%
----------------------- ------------ ------------ ----------
North America
----------------------- ------------ ------------ ----------
Six months ended 30 June 2006 30 June 2005 % change
£'000 £'000
Turnover 1,004 318 216%
Gross Profit 670 202 232%
Gross margin 67% 64% 5%
----------------------- ------------ ------------ ----------
Latin America
----------------------- ------------ ------------ ----------
Six months ended 30 June 2006 30 June 2005 % change
£'000 £'000
Turnover 855 333 157%
Gross Profit 459 221 108%
Gross margin 54% 66% -19%
----------------------- ------------ ------------ ----------
Connectid*
----------------------- ------------ ------------ ----------
Six months ended 30 June 2006 30 June 2005 % change
£'000 £'000
Turnover 276 - -
Gross Profit 276 - -
Gross margin 100% - -
----------------------- ------------ ------------ ----------
*included in North America geographic analysis
This information is provided by RNS
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Friday, 22nd November 2024
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