Interim Results
28 November 2014
mirada plc
(AIM: MIRA)
("mirada", "the Company" or "the Group")
Interim results for the six months to 30 September 2014
mirada plc, the AIM quoted leading audiovisual content interaction specialist,
announces its unaudited interim results for the six months to 30 September
2014.
This was a busy period for the Company as it continued to strengthen its
proposition for large Tier 1 customers while developing its Over The Top
("OTT") service offering.
Operational Highlights
* On track for full year performance to be in line with market expectations.
* Inaugural Tier 1 contract win in May 2014 for the iris/inspire product.
* Tier 1 contract represents a minimum of US$15 million in subscriber-based
licence fees over a 3 to 5 year period.
* Project delivered to Tier 1 customer and commercial launch on course.
* First major OTT contract win announced on 18th September 2014.
* OTT product development ahead of schedule with commercial launch expected
early in the new financial year.
Key Points
* Revenue of £2.19 million (H1 2013: £2.30 million) during the six months to
30 September 2014.
* Adjusted EBITDA* loss of £0.09 million (H1 2013: £0.52 million profit)
reflecting costs incurred from delivery of Tier 1 customer project during
the first half.
* Tier 1 customer licence and professional services fees expected to drive
second half revenue higher from commercial launch in December 2014.
* Continued investment in product development.
* Oversubscribed £3.5 million Placing at 12.5p and strengthened institutional
investor base.
*Adjusted EBITDA is defined as earnings before interest, tax, depreciation,
amortisation and share based payment charges
Post period highlights
* 96% visibility of full year consensus revenue.
* Strengthened the Board with the appointments of José Gozalbo (CTO) as an
Executive Director and Matthew Earl as a Non-Executive Director.
* New Commercial launch for Telefonica Peru, using mirada's iris technology
for its OTT product, Movistar Go.
* Company developing relationships with further Tier 1 potential customers to
diversify its geographic reach and revenue base.
Commenting on the future outlook of the Group, José Luis Vázquez, CEO of
mirada, said:
"This was a transformational period for the Company as we proved our ability to
win and service Tier 1 customers. Importantly we also launched our presence in
the rapidly growing OTT market and continued to strengthen our product base -
ensuring that we are at the forefront of market developments. Additionally
there is a growing global demand for our full suite of products and services
and we are already having a number of conversations with potential customers
outside of Latin America.
"During the period we continued to invest in product development. Some revenue
elements from the Tier 1 contract, which implied incurred costs in the first
half of the year will be recorded in the second half. This is due to IFRS
policy on backoffice licences which requires invoicing following commercial
deployment. While this had an impact on our first half numbers, we are
confident that the second half and full year will be in line with market
expectations. We continue to develop relationships with a number of Tier 1
customers and look forward to updating the market in due course.
"Our team has performed extremely well by securing a successful deployment of
our technology in a very challenging environment - proving that mirada has one
of the most capable teams in the Digital TV technology world. I am encouraged
and extremely grateful for their continued performance, which has been
recognised by the backing of a new group of institutional investors, who are
making it possible for the Company to further develop its proposition."
Enquiries:
mirada plc +44 (0) 203 751 0320
José Luis Vázquez, Chief Executive Officer
Walbrook PR +44 (0) 207 933 8783
Nick Rome/Sam Allen
mirada@walbrookpr.com
Arden Partners plc (Nomad and Joint Broker) +44 (0) 207 614 5900
James Felix (Corporate Finance)
Kam Bansil (Corporate Broking)
Chief Executive Officer's Statement
Overview
I am pleased to present the Group's financial results for the six months ended
30 September 2014. During this period the Company further strengthened its
presence in the Latin American market while proving its ability to service
large Tier 1 customers as it secured the first Tier 1 reference of its OTT
offering.
Our contract win announced on 19 May 2014 was a significant milestone for the
Company reflecting our strategic shift to a scalable subscriber-based licence
fee model. This contract alone represents a minimum of US$15 million in
subscriber-based licence fees, which will be received during a 3-5 year period
following commercial deployment. This is expected to take place before the end
of this calendar year.
This contract provided a springboard for the Company to showcase its OTT
offering with the Company signing a separate contract to provide the existing
Tier 1 customer with a TV Everywhere platform.
As a result, the customer will benefit from live and on demand content
distribution, catch-up and start-over capabilities, remote control of the set
top box from any of the multi-screen devices, session transfer or multiroom
function. Management expects that the customer will achieve similar levels of
acceptance of the service as other comparable products in the market. This
being the case, it is expected that the contract could generate revenue in
excess of US$5 million during the three years following the commercial
roll-out, which is planned to start at the beginning of the new financial year.
Technical resourcing has been completed as planned, and the product development
progress is ahead of schedule, allowing the Company to showcase the
fully-integrated suite to other relevant customers across the globe.
OTT-enabled devices have just reached the 1 billion mark, and nearly 80% of all
IP traffic will be IP video by 2018, according to latest market research.
More than 50% of Sky subscribers now connect their Sky+ HD box to the internet
to access on-demand content, proving that the OTT growth is ahead of
expectations. With the new functionalities added to our iris platform, mirada
is in an excellent position to meet customer needs. Having now deployed its
technology for our first Tier 1 customer, and following today's announcement of
the commercial launch of Movistar Go with Telefónica Peru using our OTT
technology, we have two excellent reference points for other customers
worldwide.
Financial Overview
Turnover was £2.19 million (H1 2013: £2.30 million) due to the fact that
certain backoffice licence revenues related to the deployment of inspire with
our Tier 1 Customer will be recognised in the second half of the year. This was
due to IFRS policy, which states they can only be recognized following the
commercial launch. Overall, the company expects that total revenue for the year
will be in line with market expectations.
Loans and borrowings decreased to £2.26 million (March 2014: £2.63 million) due
to regular debt repayment. In order to speed-up the product development and to
facilitate further growth in the OTT market the Company successfully raised £
3.5 million via a placing at 12.5p during the period. The placing also allowed
the Company to reduce its Non-Current Liabilities to £1.80 million (March 2014:
£2.04 million), leaving cash and cash equivalents at £1.21 million for the
period. As such the Company is in an excellent position to focus on
strengthening its OTT offering and taking advantage of growing global demand.
Overseas activities remained strong at 61% of the total revenues (H1 2013:
68%), which is in line with expectations according to the increased revenue to
be reflected in the second half of the year. It is worth noting that the
revenues in Spain were up 67% from the previous period, mostly due to a
perceived increase of Digital TV investments in the country.
Appointments
During the period we were pleased to welcome José Gozalbo (CTO) as an Executive
Director and Matthew Earl as a Non-Executive Director. The addition of two such
highly experienced individuals to our Board further strengthens our ability to
grow our relationships with big telecoms suppliers and our corporate
governance, which will be invaluable as we expand our customer proposition and
develop our business.
Outlook
The Company remains on track for full year performance to be in line with
market expectations with around 96% visibility of full year consensus revenues.
In addition, the Company is in conversation with a number of potential
customers regarding the provision of its products and expertise. On the back of
the Company's strengthened relationship with Digital TV partners in the market,
new opportunities have arisen both in Latin America and in other Countries,
widening our area of commercial activity faster than expected. We are hopeful
of adding further Tier 1 references to our customers list in the near future.
I am encouraged and extremely grateful for continued hard work that has ensured
that mirada is well placed to take advantage of rapid market growth. This has
been recognised by the backing of a new group of institutional investors, who
are making it possible for the Company to further develop its proposition.
Jose Luis Vazquez
Chief Executive Officer
27 November 2014
Consolidated income statement for the six months to 30 September 2014
Note 6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Revenue 2 2,191 2,300 4,572
Cost of sales (124) (95) (182)
Gross profit 2,067 2,205 4,390
Depreciation (9) (22) (43)
Amortisation (575) (429) (924)
Share-based payment charge (31) - (53)
Other administrative expenses (2,154) (1,693) (3,366)
Total administrative costs (2,769) (2,144) (4,386)
Operating (loss)/profit 3 (702) 61 4
Finance income - - 32
Finance expense (185) (234) (422)
(Loss)/profit before taxation (822) (173) (386)
Taxation - - 427
(Loss)/profit for period (887) (173) 41
(Loss)/earnings per share
- basic and diluted 4 (1.0p) (0.3p) 0.1p
The above amounts are attributable to the equity holders of the parent.
Consolidated statement of comprehensive income
Six months to 30 September 2014
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
(Loss)/profit for the financial period (887) (173) 41
Currency translation differences (77) 4 (26)
Total comprehensive (expense)/income (964) (169) 15
for the period
Consolidated statement of financial position as at 30 September 2014
30 September 30 September 31 March
2014 2013 2014
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Property, plant and equipment 39 48 37
Goodwill 6,946 6,946 6,946
Intangible assets 2,389 1,955 2,444
Deferred Tax assets 523 - 508
Non-current assets 9,897 8,949 9,935
Trade and other receivables 1,679 1,314 1,781
Cash and cash equivalents 1,218 3 30
Current assets 2,897 1,317 1,811
Total assets 12,794 10,266 11,746
Loans and borrowings (557) (616) (728)
Trade and other payables (1,556) (2,874) (2,339)
Provisions - (121) (76)
Current liabilities (2,113) (3,611) (3,143)
Net current Assets/liabilities 784 (2,294) (1,332)
Total assets less current 10,681 6,655 8,603
liabilities
Interest bearing loans and (1703) (2,854) (1,911)
borrowings
Embedded conversion option - (44) -
derivative
Other non-current liabilities (96) (163) (129)
Non-current liabilities (1,799) (3,061) (2,040)
Net assets 8,882 3,594 6,563
Issued share capital and reserves
attributable to equity holders of
the company
Share capital 1,141 550 861
Share premium 8,748 3,343 5,776
Other reserves 2,878 3,125 2,955
Accumulated losses (3,885) (3,424) (3,029)
Equity 8,882 3,594 6,563
Consolidated statement of changes in equity
Six months to 30 September 2014
Profit
Share Share Share Foreign Merger and
capital premium option exchange reserve loss
reserve reserve account Total
£000 £000 £000 £000 £000 £000 £000
At 1 April 2014 861 5,776 - 483 2,472 (3,029) 6,563
Profit for the financial - - - - - (887) (887)
period
Conversion of - - - - - 31 31
convertible loans into
shares
Issue of shares 280 3,220 - - - - 3,500
Share issue costs - (248) - - - - (248)
Movement in foreign - - - (77) - - (77)
exchange reserve
At 30 September 2014 1,141 8,748 - 406 2,472 (3,885) 8,882
Profit
Share Share Share Foreign Merger and
capital premium option exchange reserve loss
reserve reserve account Total
£000 £000 £000 £000 £000 £000 £000
At 1 April 2013 519 3,059 140 509 2,472 (3,234) 3,465
Loss for the financial - - - - - (173) (173)
period
Conversion of 31 284 - - - (17) 298
convertible loans into
shares
Movement in foreign - - - 4 - - 4
exchange reserve
At 30 September 2013 550 3,343 140 513 2,472 (3,424) 3,594
Profit
Share Share Share Foreign Merger and
capital premium option exchange reserve loss
reserve reserve account Total
£000 £000 £000 £000 £000 £000 £000
At 1 April 2013 519 3,059 140 509 2,472 (3,234) 3,465
Profit for the financial - - - - - 41 41
period
Conversion of 98 877 - - - (29) 946
convertible loans into
shares
Share based payment - - - - - 53 53
Transfer between - - (140) - - 140 -
reserves
Issue of shares 244 1,894 - - - - 2,138
Share issue costs - (54) - - - - (54)
Movement in foreign - - - (26) - - (26)
exchange reserve
At 31 March 2014 861 5,776 - 483 2,472 (3,029) 6,563
Consolidated statement of cash flows six months to 30 September 2014
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013 (Audited)
(Unaudited) (Unaudited)
£000 £000 £000
Cash flows from operating activities
(Loss)/profit for the period (887) (173) 41
Adjustments for:
Depreciation of property, plant and 9 22 43
equipment
Amortisation of intangible assets 575 429 924
Share based payment charge 31 - 53
Finance income - (32)
Finance expense 185 234 422
Taxation - - (427)
Operating cash flows before (87) 512 1,024
movements in working capital
Decrease/(increase) in trade 98 (34) (501)
and other receivables
Increase in trade and other (802) 82 (484)
payables
Decrease in provisions (76) (90) (136)
Net cash generated from (867) 470 (97)
operating activities
Cash flows from investing
activities
Interest and similar income 2 - 16
received
Purchases of property, plant (13) (11) (20)
and equipment
Purchases of other intangible (630) (683) (1,661)
assets
Net cash used in investing (641) (694) (1,665)
activities
Cash flows from financing
activities
Interest and similar expense (186) (103) (335)
paid
Issue of share capital 3,500 - 2,036
Costs of share issue (248) - (54)
Loans received 233 292 289
Repayment of loans (432) (196) (409)
Repayment of capital element - (5) (10)
of finance leases
Net cash (used in)/generated 2,867 (12) 1,517
from financing activities
Net (decrease)/increase in 1,359 (236) (245)
cash and cash equivalents
Cash and cash equivalents at (150) 94 94
the beginning of the period
Exchange gains on cash and 9 (1) 1
cash equivalents
Cash and cash equivalents at 1,218 (143) (150)
the end of the period
Cash and cash equivalents comprise cash at bank less bank overdrafts.
Notes to the Accounts
1. Basis of Preparation
These interim financial statements have been prepared using policies based on
International Financial Reporting Standards (IFRS and IFRIC Interpretations)
issued by the International Accounting Standards Board ("IASB") as adopted for
use in the EU. They do not include all disclosures that would otherwise be
required in a complete set of financial statements and should be read in
conjunction with the 31 March 2013 Annual Report. The financial information for
the half years ended 30 September 2014 and 30 September 2013 do not constitute
statutory accounts within the meaning of Section 434 (3) of the Companies Act
2006 and both periods are unaudited.
The annual financial statements of Mirada plc are prepared in accordance with
IFRS as adopted by the European Union. The comparative financial information
for the year ended 31 March 2014 included within this report does not
constitute the full statutory Annual Report for that period. The statutory
Annual Report and Financial Statements for the year to 31 March 2014 have been
filed with the Registrar of Companies. The independent Auditors' Report on that
Annual Report and Financial Statement for 2014 was unqualified, did not draw
attention to any matters by way of emphasis, and did not contain a statement
under 498 (2) or 498 (3) of the Companies Act 2006.
After making enquiries, the directors have concluded that the Group have
adequate resources to continue operational existence for the foreseeable
future. Accordingly, they continue to adopt the going concern basis in
preparing the half-yearly consolidated financial statements.
The same accounting policies, presentation and methods of computation are
followed in these interim consolidated financial statements as were applied in
the Group's latest annual audited financial statements. In addition, the IASB
have issued a number of IFRS and IFRIC amendments or interpretations since the
last Annual Report was published. It is not expected that any of these will
have a material impact on the Group. The Board of Directors approved this
interim report on 27 November 2014.
2. Segmental reporting
For management purposes the Group is currently organised into two operating
divisions based upon the varying products and services provided by the Group
-Digital TV & Broadcast and Mobile (which includes Interactive Marketing and
Mirada Connect). The segment headed other relates to corporate overheads.
Segmental results for the 6 months ended 30 September 2014 are as follows:
Digital
TV
&
Broadcast Mobile Other Group
£000 £000 £000 £000
Revenue - external 1,978 195 18 2,191
Gross profit 1,934 115 18 2,067
Profit/(loss) before 91 54 (233) (87)
interest, tax,
depreciation &
amortisation
Depreciation (7) - (2) (9)
Amortisation (547) (12) (15) (575)
Share Option charges - - (31) (31)
Finance income - - - -
Finance expense - - (185) (185)
Segmental profit/ (463) 41 (466) (887)
(loss)
Segmental results for the 6 months ended 30 September 2013 are as follows:
Digital
TV
&
Broadcast Mobile Other Group
£000 £000 £000 £000
Revenue - external 2,073 227 - 2,300
Gross profit 2,053 152 - 2,205
Profit/(loss) before 923 9 (420) 512
interest, tax,
depreciation &
amortisation
Depreciation (11) - (11) (22)
Amortisation (398) (14) (17) (429)
Finance income - - - -
Finance expense - - (234) (234)
Segmental profit/(loss) 514 (5) (682) (173)
Segmental results for the year ended 31 March 2014 are as follows:
Digital
TV
&
Broadcast Mobile Other Group
£000 £000 £000 £000
Revenue - external 4,149 423 - 4,572
Gross profit 4,120 270 - 4,390
Profit/(loss) 1,871 53 (900) 1,024
before interest,
tax, depreciation &
amortisation
Depreciation (23) - (20) (43)
Amortisation (864) (26) (34) (924)
Share based payment - - (53) (53)
charge
Finance income - - 32 32
Finance expense - - (422) (422)
Taxation 375 52 - 427
Segmental profit/ 1,358 79 (1,396) 41
(loss)
Revenue by location of customer
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
UK 327 329 563
Spain 463 278 650
Continental Europe 46 136 218
Americas 1,355 1,557 3,141
Total 2,191 2,300 4,572
3. Operating profit
Reconciliation of operating profit to profit before interest, taxation,
depreciation and amortisation:
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Operating profit (702) 61 4
Depreciation 9 22 43
Amortisation of deferred development 575 429 924
costs
Share-based payment charge 31 - 53
Profit before interest, taxation, dep (87) 512 1,024
reciation and amortisation
4. (Loss)/earnings per share
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
(Loss)/profit for period (£887,041) (£173,000) £41,000
Weighted average number of shares 90,353,585 52,592,314 65,233,761
Basic earnings/(loss) per share (1.0p) (0.3p) 0.1p
Adjusted earnings per share
Adjusted earnings per share is calculated by reference to the profit from
continuing activities before interest, taxation, amortisation and depreciation
(see note 3).
6 months 6 months Year ended
ended ended 31 March
30 September 30 September 2014
2014 2013
(Unaudited) (Unaudited) (Audited)
Adjusted profit for period (£87,283) £512,000 £1,024,000
Basic adjusted earnings/(loss) per (0.1p) 1.0p 1.6p
share
Diluted adjusted earnings/(loss) per (0.09p) 0.9p 1.4p
share
The Company has 5,602,555 (2013: 301,327) potentially dilutive ordinary shares
arising from share options issued to staff.
5. Related party transactions
Transactions between the company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note. There were no material transactions between the Group and the related
parties during the period.
6. Cautionary statement
Mirada plc has made forward-looking statements in this press release, including
statements about the market for and benefits of its products and services,
financial results, the potential benefits of business relationships with third
parties and business strategies. These statements about future events are
subject to risks and uncertainties that could cause Mirada plc's actual results
to differ materially from those that might be inferred from the forward-looking
statements. Mirada plc can make no assurance that any forward-looking
statements will prove correct.
7. Other
Copies of unaudited interim results have not been sent to shareholders, however
copies are available on request from the Company Secretary at the Company's
registered office, 69 Old Street, London, EC1V 9HX.
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