Print      Mail a friend



Probability plc / Index: AIM / Epic: PBTY / Sector: Gaming

30 October 2008

Probability plc ('Probability' or 'the Company')

Interim Results

'Maiden first half profits; international expansion planned.'

Probability plc, the AIM listed mobile gambling specialist, announces its interim results for the six months ended 30 September 2008.

Financial Highlights

• £166,000 maiden pre-tax profit (H1 2007: pre-tax loss of £585,000).

• £2.6m net gaming revenues, up 117% (H1 2007: £1.2m).

• Earnings per share 0.55p (H1 2007: loss per share of 3.5p). 

• Net £2.5m cash at 30 Sept 2008 (30 Sept 2007: £1m).

Operational Highlights

• Probability is now widely recognised as a leading specialist operator and platform owner of mobile casino, bingo and slots games. It now has over 400,000 customers for its 'LadyLuck's' mobile gaming service as well as providing white-label services to partners including Rank (BlueSquare and Mecca) and News International (The Sun and News of the World). 

• The business has greatly expanded distribution to mobile users having cemented partnerships with all the major UK facing mobile carriers, including 3 (2m handset pre-installation links to LadyLuck's), Orange (permanent mobile portal presence), O2, T-Mobile and Vodafone (mobile portal advertising). 

• There has been continued investment in new content, with major game launches (including 'Crazy Camels' virtual racing) and a licensing relationship with Paramount Pictures to exclusively produce and market mobile gambling games to the UK based on the 'King Creole', 'Grease' and 'The Italian Job' movie franchises.

Charles Cohen, CEO of Probability commented:

'We are delighted with these results and the breakthrough into profit. This has put us into a very strong position for further growth with continued investment in new content and plans for international expansion.'

'As a pure mobile gaming operator with a focus on low-stakes 'betertainment' aimed at the mass market, we are uniquely positioned to take advantage of consumer fatigue with on-line gaming, boredom with the lottery, and the often uninspiring and overpriced traditional mobile games on offer today. During these difficult times we appear to be enjoying a 'Lidl effect' as consumers look for value in their entertainment as with everything else. Being immediately available on their mobile phone, at 10p a spin, we are in the right place at the right time to capture these customers.'

'As well as expecting to continue our strong growth in the UK market, we are making ambitious plans to expand LadyLuck's into selected overseas markets and to push ahead with our aggressive product development plans. This is just the beginning for Probability.'

For further information visit www.probabilityplc.com or contact:

 

Chairman's Statement

The first half of 2008/9 was very successful for Probability and gives us every reason to be confident about the future.

Although the current economic conditions provide a challenge, mobile gaming offers the ultimate convenience for cost conscious consumers and we believe that Probability has a great product for these trying times. 

Through our relationships with mobile networks and our investment in original and branded content, we have established a strong base in the UK market where there remains plenty of growth potential. With the UK remaining the main event for us, we do now believe that this is the right time to selectively expand our marketing into other countries with localised offerings in key markets that show the most potential. 

The cost of developing these new services will be met entirely from existing resources and deployment can be achieved without distracting attention from the UK business or from our product development plans in general. 

The Board remains cognisant of regulatory complexities which exist in certain jurisdictions and will take appropriate advice at every stage and adopt a balanced approach to risk and reward as we embark upon this controlled expansion.

I believe that the coming months and years will be even more exciting and offer greater opportunities for profitable growth at Probability. 

Graham Parr

Chairman

  

Consolidated Income Statement
	Half year	Half Year	Year ended
	30th September	30th September	31st March
	2008	2007	2008
	£'000	£'000	£'000
	(unaudited)	(unaudited)	(audited)
Continuing operations
Net gaming revenue	2621	1174	3157
Operating expenses	(535)	(370)	(782)
Administrative expenses	(2033)	(1428)	(3542)
Other administrative expenses	(1970)	(1414)	(3472)
Share benefit charge	(63)	(14)	(70)
Operating profit/ (loss)	53	(624)	(1167)
Finance income	50	25	52
Profit/(loss) before tax	103	(599)	(1115)
Taxation	-	-	(195)
Profit / (loss) after tax	103	(599)	(1310)
Earnings/( loss) per share (pence)
Basic	0.55p	(3.5)p	(7.06)p
Diluted	0.51p	(3.5)p	(7.06)p
Consolidated Balance Sheet
	Half year	Half year	Year ended
	30th September	30th September	31st March
	2008	2007	2008
	£'000	£'000	£'000
	(unaudited)	(unaudited)	(audited)
Assets
Non-current assets
Intangible assets	-	142	-
Property, plant and equipment	103	108	118
Deferred taxes	-	195	-
Current assets
Trade and other receivables	628	592	537
Cash and cash equivalents	2501	1033	2501
Total assets	3232	2070	3156
Current liabilities
Trade and other payables	478	576	568
Provisions	238	-	238
Total liabilities	716	576	806
Total net assets	2516	1494	2350
Equity attributable to equity
holders of the parent
Share capital	216	189	216
Share premium	5240	3568	5240
Reverse acquisition reserve	1380	1380	1380
Retained deficit	(4320)	(3643)	(4486)
Total equity attributable to
equity holders of the parent	2516	1494	2350

Consolidated Statement of Cash Flows
	Half Year	Half Year	Year Ended
	30th September	30th September	31st March
	2008	2007	2008
	£'000	£'000	£'000
	(unaudited)	(unaudited)	(audited)
Cash flows from operating activities
Profit /(loss) before tax	103	(599)	(1115)
Adjustments for:
Finance Income	(50)	(25)	(52)
Depreciation	25	83	43
Share benefit charge	63	14	70
(Increase)/ decrease in trade receivables	(91)	(292)	(237)
(Decrease)/increase in trade and other payables	(90)	176	168
Increase in provisions	-	-	238
Cash used in operations	(40)	(643)	(885)
Cash Flow from investing activities
Purchase of intangible assets	-	(19)	-
Purchase of property, plant and equipment	(10)	(10)	(44)
Finance income	50	25	52
Net cash generated from/(used in) investing activities	40	(4)	8
Cash flows from financing activities
Issue of shares	-	9	1707
Net cash generated from financing activities	-	9	1707
Net increase/decrease in cash and cash equivalents	-	(638)	830
Cash and cash equivalents at the beginning of the period	2501	1671	1671
Cash and cash equivalent at the end of the period	2501	1033	2501

Consolidated statement of recognised income and expense
	Half year	Half year	Year ended
	30th September	30th September	31st March
	2008	2007	2008
	£'000	£'000	£'000
	(unaudited)	(unaudited)	(audited)
Profit /(Loss) for the period	103	(599)	(1115)
Total recognised income and expense
for the period	103	(599)	(1115)

General information

Probability is a public limited company incorporated in the United Kingdom under the Companies Act 1985 (Registration No. 5830059). The Company's registered address is Staple Court, 11 Staple Inn Buildings, London, WC1V 7QH. The company's ordinary shares are traded on the Alternative Investment Market ('AIM'). Copies of this report will be available to shareholders on the Company's website. Further copies of the report may be obtained from the above address or on the Investor Relations section of the Company's website at www.probabilityplc.com

Basis of Accounting 

These interim accounts have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRS) as endorsed for use by the EU.

These standards remain subject to outgoing amendment and/or interpretation and are therefore still subject to change. Accordingly information contained in these interim financial statements may need to be updated for subsequent amendments or for new standards issued after the balance sheet date. 

This statement does not comprise statutory accounts as defined in Section 240 of the Companies Act 1985. The financial information for the year ended 31 March 2008 is an extract from the latest company accounts as at 31 March 2008, on which the auditors gave an unqualified opinion. The audit report given on these financial statements did not include reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not include a statement under section 237 (2) or (3) of the Companies Act 1985. These financial statements have been filed with the Registrar of Companies. The results for the period ended 30 September 2008 and for the period ended 30 September 2007 are unaudited.

The financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (£'000) except where otherwise indicated. 

Taxation 

Under IFRS deferred tax is provided in full using the balance sheet liability method, on the basis of temporary differences between the carrying value of assets and liabilities in the balance sheet and their tax bases. Deferred tax assets are recognized only to the extent that it is probable that they can be utilized against future taxable profits. Current tax for the period is not payable due to the availability of prior period losses.

Earnings/ (Loss) per share

The basic earnings per ordinary share has been calculated using the profit for the financial period of 

£ 103,000 (30 September 2007 - loss of £ 599,000 and 31 March 2008 - loss of £1,310,000) and weighted average number of ordinary shares of 18,761,956 (30 September 2007- 18,059,927 and 31 March 2008- 18,546,250).

For the period ended 31 September 2008 the weighted average number of diluted shares used to calculate diluted EPS was 20,353,169. As the company made losses in prior periods the loss per share has not been diluted for other periods.

ENDIR MLBFTMMMTBMP