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Bidstack Group PLC (BIDS)

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Thursday 02 September, 2021

Bidstack Group PLC

Interim Results - six months ended 30 June 2021

RNS Number : 4702K
Bidstack Group PLC
02 September 2021
 

This announcement contains inside information as stipulated under the UK version of the Market Abuse Regulation No 596/2014 which is part of English Law by virtue of the European (Withdrawal) Act 2018, as amended.  On publication of this announcement, this information is now considered to be in the public domain.

 

 

2 September 2021

 

Bidstack Group Plc

("Bidstack" or "Company" or "Group")

Interim Results for the six months ended 30 June 2021

-Good financial and operational progress.  Well capitalised to pursue growth strategy --

 

Bidstack Group Plc (AIM: BIDS.L), the native in-game advertising group, announces its unaudited results for the six months ended 30 June 2021. The Interim Report for the period ended 30 June 2021 will be published on the Company's website - www.bidstackgroup.com today.

Financial Highlights

· Revenue of £820k (H1 2020: £274k);

· Gross margin improvement to 34.5% (H1 2020: 27.9%);

· Period end cash balance of £695k (30 June 2020: £5.9m);

· Loss per share reduced to 0.74 pence (H1 2020: loss of 1.18 pence per share).

Post Period End Highlights

· Successful £10.863m equity fundraising (before expenses) completed on 23 July 2021;

· Bryan Neider, 25 year veteran at Electronic Arts, joined the Board as an independent Non-Executive Director on 23 July 2021.

Operational Highlights

Significant progress made in onboarding titles across stadium, racing and open world environments as well as Unity, Unreal and custom games engines; 

Now offering advertisers increased and broader inventory from a portfolio with over 30 games;

Reinforcing relationships with the world's leading agency holding groups which are now growing outside of the UK and US; 

Developing momentum in engaging directly with brands; 

Continuing to integrate with established third party ad-tech vendors which increases accessibility to Bidstack inventory in core markets; 

Significant developments with the IAB, the industry trade body, in defining "in-game" as a new formal advertising category and providing scalable guidelines. 

Donald Stewart, Chairman, said:

"Following completion of the fundraise on 23 July 2021, with approximately £10.2 million of net proceeds, Bidstack is now well capitalised to exploit the commercial opportunities it currently has and to pursue its strategy for some time to come.

"The second half of the current financial year has started well and in line with our expectations.   Since the period end Bidstack has onboarded a number of new games including Nordeus' flagship football management game, Top Eleven, T-Bull's classic car driving simulation game Racing Classics PRO: Drag Race & Real Speed, Motionlab Interactive's multiplayer PDC Darts Match and Suji Games' animated simulation game Hyper Airways.  We expect a number of further games to join Bidstack's roster in the second half.

"With improving visibility of the sales pipeline, we believe the Company has a strong pipeline of revenue for the second half as existing advertisers rebook with growing spend and business development efforts come to fruition.

"The Company continues to expect to deliver revenues for the year in line with market expectations. In addition, the Board has been focussed on improving gross margin and controlling the Group's total operational costs going forward, as it starts to rebalance capital deployed to reflect the shift from product development to commercialisation."

James Draper, Chief Executive, said:

"I want to put on record how proud I am of the team's continued work towards establishing Bidstack as a stalwart of in-game advertising. Watching our incredible staff establish and build-out relationships with some of the world's most recognised advertisers, agencies, technology providers and game studios leaves me in no doubt that Bidstack is going from strength to strength.

"Our technology and commercial expertise are proven and in high demand - and the understanding our team has shown towards our customers and potential partners is delivering additional opportunities.

"Our progress year-to-date reflects the team's dedication to driving the business across advertisers, game developers and product strategy.

"Campaign spends are growing substantially and the number of game studios wanting to work with our team is expanding.

"Key highlights, such as the exclusive partnership with Nordeus, progress in the US with the IAB and growing access to our inventory, all lead me to believe we are on the pathway to scalability.

"The opportunities that lie ahead in the second half in relation to innovative product launches have our team hugely motivated - and we look forward to sharing more of these developments when we can."

For further information please contact:

Bidstack Group Plc

 

James Draper, CEO

via Buchanan

 

 

SPARK Advisory Partners Limited (Nomad)

 

Mark Brady/Neil Baldwin/James Keeshan

+44 (0) 203 368 3550

 

 

Stifel Nicolaus Europe Limited (Broker)

 

Fred Walsh

+44 (0) 20 7710 7600

 

 

Buchanan Communications Limited

 

Chris Lane/Stephanie Watson/Kim van Beeck

+44 (0) 20 7466 5000

 

 

[email protected]

 

 

 

 

 

Chairman's Statement

H1 Trading

Bidstack has made significant progress in onboarding titles across stadium, racing and open world environments as well as Unity, Unreal and custom games engines.  The Company has continued to strengthen its portfolio of AAA, high-fidelity games, independent and mobile publisher base.

The Company has successfully onboarded game developers who have endorsed Bidstack's SDK for its ease of integration, stability of the technology and immersive implementation of advertising which enhances the player experience.  The pipeline of games is robust as game developers increasingly look for incremental revenue streams and entrust Bidstack with their portfolio of titles.

Bidstack continues to reinforce its relationships with the world's leading agency holding groups which are now growing outside of the UK and US, enabled by multi-agency master agreements already in place.  The progress that the Company continues to make in engaging directly with brands is developing momentum from Bidstack's vertical led approach that encompasses all major advertising categories including technology, retail, automotive, consumer packaged goods, beauty, luxury, gambling and financial services. 

The Company continues to integrate with established third-party ad-tech vendors which increases accessibility to Bidstack inventory in core markets, comprising the UK and the US.  This is an important development which marks the maturity, growth and frictionless scalability of the industry.  Further integrations are planned to drive automation and expansion.

There have been material developments with the IAB, the industry trade body, in defining "in-game" as a new formal advertising category and providing scalable guidelines.  The establishment of an IAB US committee, of which Bidstack is an active member, is expected to expand the foundational framework which is being delivered in the UK.  Progress is encouraging, with key industry stakeholders across the value chain unified in creating standards which should enable frictionless growth.  

Fundraising

On 2 July 2021, Bidstack announced the results of a fundraising which raised gross proceeds of £10.863m comprising a placing with institutional and other investors (£9.763m) and a subscription from Company directors and others (£1.1m). 

Board and Strategic Adviser Appointments

On 22 April 2021 Lisa Hau, Bidstack's Chief Operating Officer, joined the Board as an Executive Director and Glen Calvert, the former COO of Fnatic Ltd, was appointed an independent Non-executive Director.

Prior to joining Bidstack in May 2020, Lisa led investor relations at WPP PLC following five years as an equity research analyst heading up coverage for the European media and internet sector with Jefferies, a leading multinational investment bank.

Glen was COO of Fnatic Ltd, between January 2019 and May 2021. He is currently launching Kaizan.ai, an AI start-up augmenting team intelligence. Previously he was a founder and CEO of Affectv and a member of the founding team at Struq, which was acquired by Quantcast in 2014.  

On 29 April 2021, Katherine Hays, the Co-Founder and former COO of Massive Inc. joined Bidstack as a Strategic Adviser.  Katherine has a proven track record in advertising, media, entertainment and gaming.  She will take an active role in giving the Company the benefit of her experience and success from the first generation of in-game advertising.

On 23 July, following completion of the fundraising, Bryan Neider was appointed to the Board as an independent Non-Executive director and Chair of the Audit Committee.  Bryan brings more than 25 years of experience during his tenure at Electronic Arts and served a variety of leadership roles including managing global business development, corporate finance, CFO and COO for EA.com, CFO of Worldwide Studios, COO for EA's global development organisation and SVP of Global Operations.

Outlook and Future Prospects

Following completion of the fundraise on 23 July 2021, with approximately £10.2 million of net proceeds, Bidstack is now well capitalised to exploit the commercial opportunities it currently has and to pursue its growth strategy

The second half of the current financial year has started well and in line with our expectations.

Since the period end Bidstack has onboarded a number of new games including Nordeus' flagship football management game, Top Eleven, T-Bull's classic car driving simulation game Racing Classics PRO: Drag Race & Real Speed, Motionlab Interactive's multiplayer PDC Darts Match and Suji Games' animated simulation game Hyper Airways.  The Directors expect a number of further games to join Bidstack's roster in the second half.

Bidstack's growth is reflected in its portfolio rising to over 30 games and a growing roster of premium brands.  With improving visibility of the sales pipeline, the Directors believe the Company has strong revenue prospects for the second half, as the existing roster of advertisers rebook with growing spend and business development efforts come to fruition.

The Company continues to expect to deliver revenues for the year in line with market expectations. In addition, the Board has been focussed on improving gross margin and controlling the Group's total operational costs going forward, as it starts to rebalance capital deployed to reflect the shift from product development to commercialisation.

 

Consolidated statement of comprehensive income

for the six months ended 30 June 2021

 

 

Note

 

 

 

 

 

Unaudited

6 months ended

30 Jun 2021

Unaudited

6 months ended

30 Jun 2020

Audited

year

ended

31 Dec 2020

 

 

£

£

£

 

 

 

 

 

Revenue

 

820,136

274,079

1,695,620

Cost of sales

 

(537,309)

(197,337)

(1,470,389)

Gross profit

 

282,827

76,742

225,231

 

 

 

 

 

Administrative expenses

 

(3,915,874)

(3,244,889)

(7,218,789)

Operating loss

 

(3,633,047)

(3,168,147)

(6,993,558)

 

 

 

 

 

Finance income

 

60

2,352

2,525

Finance costs

 

(160)

(700)

(1,179)

Loss before taxation

 

(3,633,147)

(3,166,495)

(6,992,212)

 

Taxation

 

744,756

50,493

597,035

Loss for the period

 

(2,888,391)

(3,116,002)

(6,395,177)

 

 

 

 

 

Other comprehensive income

 

 

 

 

Total other comprehensive income

 

-

-

-

Total comprehensive loss for the period

 

(2,888,391)

(3,116,002)

(6,395,177)

 

 

 

 

 

 

 

 

 

 

Loss per share - basic and diluted (pence)

3

(0.74)

(1.18)

(1.65)

 

 

 

 

 

 

The above consolidated statement of profit and loss and other comprehensive loss for the period relates to continuing operations for the Group.

 

Consolidated statement of financial position

as at 30 June 2021

 

 

Note

 

Unaudited

30 Jun 2021

Unaudited

30 Jun 2020

Audited

31 Dec 2020

ASSETS

 

 

£

£

£

Non-current assets

 

 

 

 

 

Right of use asset

 

 

649

21,369

7,577

Intangible assets

 

 

264,357

290,141

279,955

Property, plant and equipment

 

 

41,277

23,795

28,388

Total non-current assets

 

 

306,283

335,305

315,920

 

 

 

 

 

 

Current assets

 

 

 

 

 

Trade and other receivables

 

 

1,229,387

862,660

2,391,300

Cash and cash equivalents

 

 

694,544

5,917,381

2,347,114

Total current assets

 

 

1,923,931

6,780,041

4,738,414

 

 

 

 

 

 

Total assets

 

 

2,230,214

7,115,346

5,054,334

 

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

Equity

 

 

 

 

 

Share capital

4

 

6,234,261

6,229,259

6,234,261

Share premium account

 

 

27,984,716

27,977,197

27,984,716

Share-based payment reserve

 

 

1,497,826

1,035,638

1,282,556

Merger relief reserve

 

 

6,508,673

6,508,673

6,508,673

Reverse acquisition reserve

 

 

(23,320,632)

(23,320,632)

(23,320,632)

Warrant reserve

 

 

71,480

71,480

71,480

Accumulated losses

 

 

(18,467,293)

(12,299,727)

(15,578,902)

Total equity

 

 

509,031

6,201,888

3,182,152

 

 

 

 

 

 

 

 

 

 

 

 

Non - Current liabilities

Lease liability

 

 

675

15,790

-

Total non -current liabilities

 

 

675

15,790

-

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade and other payables

 

 

1,720,508

897,014

1,863,739

Lease liability

 

 

-

654

8,443

Total current liabilities

 

 

1,720,508

897,668

1,872,182

 

 

 

 

 

 

Total equity and liabilities

 

 

2,230,214

7,115,346

5,054,334

 

The interim financial report was approved by the board of Directors on 1 September 2021 and signed on its behalf by:

 

 

Donald Stewart

Chairman of Bidstack Group Plc

Consolidated statement of changes in equity

for the six months ended 30 June 2021

 

 

Share capital

Share premium

Share-based payment reserve

Merger relief reserve

Reverse acquisition reserve

Warrant reserve

Accumulated losses

 

Total

equity

 

 

£

£

£

£

£

£

£

£

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 January 2021

6,234,261

27,984,716

1,282,556

6,508,673

(23,320,632)

71,480

(15,578,902)

3,182,152

Comprehensive income for the period

 

 

 

 

 

 

 

 

Loss and total comprehensive income for the year

-

-

-

-

-

-

(2,888,391)

(2,888,391)

Total comprehensive expense

-

-

-

-

-

-

(2,888,391)

(2,888,391)

Transactions with owners

 

 

 

 

 

 

 

 

Issue of shares

-

-

-

-

-

-

-

-

Costs of raising equity

-

-

-

-

-

-

-

-

Share-based payments

-

-

215,270

-

-

-

-

215,270

Total transaction with owners

-

-

215,270

-

-

-

-

215,270

 

-

-

 

 

 

 

 

 

Balance as at 30 June 2021

6,234,261

27,984,716

1,497,826

6,508,673

(23,320,632)

71,480

(18,467,293)

509,031

                     

 

Consolidated statement of changes in equity

for the six months ended 30 June 2020

 

 

Share capital

Share premium

Share-based payment reserve

Merger relief reserve

Reverse acquisition reserve

Warrant reserve

Accumulated losses

 

Total

equity

 

 

£

£

£

£

£

£

£

£

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 January 2020

5,516,759

23,283,880

734,365

6,508,673

(23,320,632)

71,480

(9,183,725)

3,610,800

Comprehensive income for the period

 

 

 

 

 

 

 

 

Loss and total comprehensive income for the year

-

-

-

-

-

-

(3,116,002)

(3,116,002)

Total comprehensive expense

-

-

-

-

-

-

(3,116,002)

(3,116,002)

Transactions with owners

 

 

 

 

 

 

 

 

Issue of shares

712,500

4,987,500

-

-

-

-

-

5,700,000

Costs of raising equity

-

(294,183)

-

-

-

-

-

(294,183)

Share-based payments

-

-

301,273

-

-

-

-

301,273

Total transaction with owners

712,500

4,693,317

301,273

-

-

-

-

5,707,090

 

 

 

 

 

 

 

 

 

Balance as at 30 June 2020

6,229,259

27,977,197

1,035,638

6,508,673

(23,320,632)

71,480

(12,299,727)

6,201,888

                       

 

 

 

Consolidated statement of changes in equity

for the year ended 31 December 2020

 

Share capital

Share premium

Share-based payment reserve

Merger relief reserve

Reverse acquisition reserve

Warrant reserve

Accumulated losses

 

Total

equity

 

 

£

£

£

£

£

£

£

£

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 January 2020

5,516,759

23,283,880

734,365

6,508,673

(23,320,632)

71,480

(9,183,725)

3,610,800

Comprehensive income for the period

 

 

 

 

 

 

 

 

Loss and total comprehensive income for the year

-

-

-

-

-

-

(6,395,177)

(6,395,177)

Total comprehensive expense

-

-

-

-

-

-

(6,395,177)

(6,395,177)

Transactions with owners

 

 

 

 

 

 

Issue of shares

717,502

5,032,518

-

-

-

-

-

5,750,020

Costs of raising equity

-

(331,682)

-

-

-

-

-

(331,682)

Share-based payments

-

-

548,191

-

-

-

-

548,191

Total transaction with owners

717,502

4,700,836

548,191

-

-

-

-

5,966,529

 

 

 

 

 

 

 

 

 

Balance as at 31 December 2020

6,234,261

27,984,716

1,282,556

6,508,673

(23,320,632)

71,480

(15,578,902)

3,182,152

 

Consolidated statement of cash flows

for the period ended 30 June 2021

 

 

6 months ended 30 Jun 2021

 

6 months ended 30 Jun 2020

Year  ended  31 Dec 2020

 

 

£

£

£

Cash flows from operating activities

 

 

 

 

Loss before taxation

 

(2,888,391)

(3,116,002)

(6,992,212)

Adjustments for:

 

 

 

 

Amortisation - Intangibles

 

15,598

26,818

31,574

Amortisation - Right of use asset

 

6,928

5,341

19,621

Depreciation

 

9,442

6,162

13,021

Equity settled share-based payments

 

215,270

301,273

548,191

Doubtful debts expense

 

-

-

(19,265)

Finance income

 

(60)

(2,352)

(2,525)

Finance expense

 

160

700

1,179

 

 

(2,641,053)

(2,778,060)

(6,400,416)

Changes in working capital

 

 

 

 

(Increase)/decrease in trade and other receivables

 

1,161,913

(329,453)

(1,241,792)

Increase/(decrease) in trade and other payables

 

(143,231)

490,343

1,457,069

Net cash used in operations

 

(1,622,371)

(2,617,169)

(6,185,139)

 

 

 

 

 

 

 

 

 

 

Cash flow from investing activities

 

 

 

 

Investment in intangible assets

 

-

(6,000)

(570)

Investment in property, plant and equipment

 

(22,331)

(7,581)

(19,033)

Net cash flow (used in)/ generated from investing activities

 

(22,331)

(13,581)

(19,603)

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

Proceeds from issue of share capital

 

-

5,700,000

5,750,020

Cost of issue

 

-

(294,183)

(331,682)

Principal movement on lease liabilities

 

(7,768)

(7,878)

(16,368)

Interest received

 

60

2,352

2,525

Interest paid on lease liabilities

 

(160)

(700)

(1,179)

Net cash generated from financing activities

 

(7,868)

5,399,591

5,403,316

 

 

 

 

 

 

 

 

 

 

(Decrease)/Increase in cash and cash equivalents in the period

 

1,652,570

2,768,841

(801,426)

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

2,347,114

3,148,540

3,148,540

 

 

 

 

 

Cash and cash equivalents at the end of the period

694,544

5,917,381

2,347,114

 

Notes to the consolidated interim financial report

Summary of significant accounting policies

 

Basis of preparation

 

The Company is a public limited company which is admitted to trading on the AIM Market of the London Stock Exchange and is incorporated and domiciled in the UK. The address of the registered office is 201 Temple Chambers, 3-7 Temple Avenue, London, EC4Y 0DT. The registered number of the company is 04466195.

 

The consolidated interim financial report consolidates those of the Company and its trading subsidiary, Bidstack Limited (together the "Group"). The financial information presented in this interim report have been prepared using accounting policies that are expected to be applied in the preparation of the financial statements for the year ending 31 December 2021.

 

These policies are in accordance with International Financial Reporting Standards (IFRSs) and International Financial Reporting Interpretation Committee (IFRIC) interpretations as endorsed by the European Union ("IFRS-EU"), and those parts of the Companies Act applicable to companies reporting under IFRS.

 

The interim results have been prepared on a going concern basis which assumes that the Group will be able to continue trading for the foreseeable future.  Although an operating loss has been reported for the reporting period and an operating loss is expected to be incurred in the 12 months subsequent to the date of this report, the Directors believe, having considered all available information, including the cash resources currently available to the Group and the Company's proven ability to raise further equity funds from its supportive shareholder base, that the Group will have sufficient funds to meet its expected committed and contractual expenditure for the foreseeable future. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the interim financial report for the period ended 30 June 2021.

 

 

Summary of significant accounting policies

The accounting policies applied by the Group in this consolidated interim financial report are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2020.

Loss per share

 

Basic and diluted loss per share

 

The calculation of basic and diluted loss per share is based upon the loss of £2,888,391 (2020: loss of £3,116,002) and the weighted average number of ordinary shares in issue for the year of 388,374,057 (2020: 264,555,996).

 

The loss incurred by the Group means that the effect of any outstanding warrants and options would be considered anti-dilutive and is ignored for the purposes of the loss per share calculation.

 

Share capital and reserves

 

Allotted, called up and fully paid

 

 

Ordinary 0.5p shares

Share capital

 

 

 

No.

£

 

 

 

 

 

At 1 January 2020

 

 

244,873,646

5,516,759

 

 

 

 

 

 

 

 

 

 

Exercised warrants

 

 

1,000,411

5,002

Exercised options

 

 

-

-

Issue of shares

 

 

142,500,000

712,500

Issue of consideration shares

 

 

-

-

As at 31 December 2020

 

 

388,374,057

6,234,261

 

 

 

 

 

Issue of shares

 

 

-

-

As at 30 June 2021

 

 

388,374,057

6,234,261

 

All ordinary shares are equally eligible to receive dividends and the repayment of capital and represent equal votes at meetings of shareholders.

 

Post balance sheet events

 

On 23 July 2021 the Company raised gross proceeds of £10.863m (before expenses).

 

A total of 488,157,516 new ordinary shares of 0.5 pence each in the capital of the Company were placed by Cenkos with institutional and other investors at a price of 2.0 pence per share, raising gross proceeds of approximately £9.763 million.

 

Certain directors of the Company and others have also subscribed for a total of 55,000,000 New Ordinary Shares at 2.0 pence per share raising further gross proceeds of £1.1 million.

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