Trading Statement

RNS Number : 0324N

Mobile Streams plc

23 July 2014

 



23^rd July 2014

Mobile Streams plc ("Mobile Streams" or the "Company")

Full Year Trading Update

Mobile Streams PLC (AIM: MOS), the emerging market focused mobile media company, provides an update to its shareholders on its unaudited financial and business performance for the 12 months ended 30 June 2014:

-             Revenues of approximately £47m (compared to £53.9m for the 12 months ended 30 June 2013). All revenues are from continuing operations and include no exceptional items. 84% of the revenues were generated in Argentina in this financial year.

-             Positive EBITDA*, in line with market expectations, albeit significantly reduced compared to the prior year due to foreign exchange factors and business factors (compared to £5.2m for the 12 months ended 30 June 2013).

-            Cash of around £2.9m at end June 2014, with no debt (basically unchanged from the £2.85m of cash on 30 June 2013). Around 16% of the cash was held in Argentina, with the rest primarily held in the UK, US, Mexico and Colombia.

-            Mobile Internet active subscribers increased to around 4.5 million (compared to 3.4 million at end June 2013). Active subscribers are defined as consumers who have purchased content from the Company in the past two months.

*Calculated as profit before tax, interest, amortisation, depreciation, share compensation expense and impairment of assets.

Commenting, Simon Buckingham, CEO of Mobile Streams said:

"Mobile Streams made progress operationally during the course of the year as we expanded our mobile internet subscriber base by more than a million subscribers across our key operating markets of Argentina, Mexico, Colombia and Brazil.

The reduction in profits during the period was caused by a combination of operational and non-operational factors. One factor was adverse foreign exchange currency movements, in particular the weakening of the Argentine Peso by 50% against USD and the strengthening of the GBP by 12% against USD for the financial year. The Company books marketing expenses wholly at the time they are incurred, whereas the vast majority of the Company revenues are subscription based and booked over time. As such, when the Company increases marketing expenditures to invest in growing its recurring revenue base, gross margins typically fall initially. The Board believes that when all factors are taken into consideration, the rapid and significant currency devaluation of the Argentine Peso and other Latin American currencies accounted for the majority of the reduction in EBITDA year on year.

Mobile Streams enters the new financial year with a clear focus on continuing to expand its operating base and diversify its revenue sources from Argentina across Latin America. To expand the number of addressable consumers, the Company is also looking to add additional network operator billing connections in Brazil, Colombia and Mexico. Additionally, the Company is actively exploring additional opportunities in emerging markets across Asia, Africa and India as these markets adopt smartphones and high-speed mobile data networks.

We look forward to updating shareholders with our progress at our final results which we expect to report in October."

Enquires:

Mobile Streams	[phone]
Simon Buckingham, Chief Executive Officer
N+1 Singer (Nominated Adviser and Broker)	[phone]
Jonny Franklin-Adams
Richard Salmond

 

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