Bango Regulatory News (BGO)

28 February 2011

Embargoed until 07:00

BANGO PLC

("Bango" or "the Company")

Trading Update

Bango plc (AIM:BGO.L), the mobile web payments and analytics company, today provides an update on trading for the year ending 31 March 2011.

A key development for the year has been the success and momentum we are experiencing in enabling mobile operator payments for "Mobile Applications" (Apps) for our customers. In particular, the Blackberry AppWorld App store, as previously announced, has now started rolling out Mobile Operator billing in multiple markets leveraging Bango payment and settlement technology. We remain committed to this significant market opportunity and, as stated in our trading update in October and Interim Results in November, intend to focus on this fast growing section of the Bango business.

While Bango is seeing positive results and growth from the RIM project and other "App Store" opportunities, which remain our key focus for Bango payments and analytics for the coming year, indications for February and March are that the traditional "content aggregator" business is not showing the expected signs of recovery. App Stores are proving, in the near term, a primary distribution channel for mobile content providers. Bango has achieved notable success in powering payments within this App Store distribution model and we expect to confirm at least one more relationship with an App Store provider in the first quarter of FY2012 (April - June 2011).

The continued decline in the "high volume, low margin" traditional business, coupled with an expectation that revenues from the next significant App store business will begin in the first half of next year (rather than in March) means we expect that the financial outcome for the year ending 31 March 2011 will be lower than market forecasts.

Gross Profit in the second half is expected to rise despite reduced overall revenues. This is as a result of the increase in gross profit from high margin revenues more than compensating for the reduction in gross profit generated due to the decline in revenue coming from the low margin "end user spend."

The second half is currently expected to show a small profit, compared with a loss in the first half, reflecting the progress made with the new streams of business and management of costs associated with the traditional business.

Bango relationship with RIM and additional App Stores

Bango provides Mobile Network Operator (''Carrier'') billing for RIM AppWorld. The first mobile operator, AT&T, went live towards the end of the first half, enabling RIM application developers to benefit from increased revenues. During the second half, Bango has been connecting and commissioning many new carriers, both in its pool of existing connections and new connections. More vendors are now generating transactions through the RIM platform than through direct connection to Bango, and in January these transactions were larger in overall value than any one of Bango's traditional customers.

While technical interconnect can normally be completed and tested in a few weeks, the completion of three way commercials for some new Carrier relationships, which may also involve RIM, can take longer than previously experienced. Therefore the activation of new carriers for RIM AppWorld for example has taken longer than Bango expected. Bango has re-deployed personnel to enable the processing of many more carriers in parallel. The longer period from initiation to revenue generation for connections means most of the revenue boost from such connections will move from the January to March quarter to the first half of the next financial year. We continue to see evidence that the magnitude of this relationship is transformational for Bango and, in addition, Bango will seek to implement measures to gain a greater level of visibility and predictability of revenues as the relationship develops.

We are in planning and negotiation with providers of other "App Stores" regarding similarly significant relationships and look forward to being able to update the market on these discussions in due course.

Traditional Mobile Content Sales

The sales of mobile content and services by our traditional customers has, as previously discussed, been impacted by industry factors - primarily relating to consumer refund policies of US mobile operators. It was anticipated that there would be a return to growth in this traditional business due to resolution of these industry-related issues in January 2011, following the pause in US carrier approvals during the Christmas period. However, after a thorough review of the status of these issues in February, Bango now believes growth in volumes from our traditional business will not significantly recover in the next few months, and we will be undertaking a further review of the business model in this particular area of activity after the full year results are published.

Ray Anderson, CEO, commented: 

''The increase in gross profit and an expected return to profit this half, despite the decline in volumes in the traditional business, shows we are making progress with our newer, larger customers. We have been extremely encouraged by the quick uptake of Bango's payment platform by RIM's app developer community, and the interest in Bango technology from other large industry players.

"We are actively progressing significant opportunities with additional App store providers, which will also have benefits for our other customers, including RIM and our traditional content providers, as we scale out into other territories with these new prospects.

"We remain committed to the tight management of the business and are confident we have a sufficiently robust financial platform from which to capitalise on these opportunities."

Contact Details:

About Bango

Bango (AIM: BGO) provides technology that enables commerce on the mobile web.

Bango enables businesses of all sizes to collect payment for music, games, applications, videos and services sold to internet connected mobile phone users. Bango is able to charge payments to mobile phone bills or use other billing methods such as credit card based on intelligence about the consumer. Bango also provides an analytics service that provides accurate information about visitors and the effectiveness of marketing activities for mobile web sites.

Visit www.bango.com.