BSD.L Regulatory News (BSD)

2 Apr 2007 07:03

Zone-IP Limited02 April 2007 2 April 2007 Zone-IP Ltd ("Zone-IP" or the "Company") Preliminary results for the year ended 31 December 2006 Ra'anana, Israel , 2 April 2007 : Zone-IP Ltd. (LSE: ZIP), formerly known asKi-Bi Mobile Technologies Ltd ("Ki-Bi"), announces its unaudited financialresults for the year ended 31 December 2006. In April 2006 the Company discontinued its main business activities.Subsequently, in July 2006, the Company acquired Emblaze V CON Ltd., a companywhich offers video over-IP conferencing solutions and changed its name toZone-IP Ltd. and began trading under its new name on the AIM Market. FINANCIAL HIGHLIGHTS: • Total revenues from operations were $6.6 million (2005: $4.5 million*) • Net loss was $5.9 million ** (2005: $913,000*) • Total assets as at 31 December 2006 were $12.1 million (2005: $7.2 million*) • Cash and marketable securities of $7.2 million at 31 December 2006 * Under IFRS, the acquisition of Emblaze V CON by Zone-IP has been accounted foras a reverse acquisition, and accordingly, Emblaze V CON is treated as theacquirer for financial reporting purposes. All 2005 comparable informationtherefore relates to Emblaze V CON solely and does not include Zone-IP or any ofits then subsidiaries. ** The results for the year ended 31 December 2006 include the results ofEmblaze V CON for the full year of 2006 and Zone-IP and its subsidiaries witheffect from 13 July 2006, the date the reverse acquisition was completed. Enquiries: Zone-IPHadas Gazit +972 9 769 9633 Emblaze V CONDavid Amir +972 9 762 7800 John East & Partners LimitedDavid Worlidge/Simon Clements +44 20 7628 2200 CHAIRMAN'S STATEMENT In the year ended 31 December 2006 the Company incurred a loss on continuingoperations of $5.9 million (2005: profit $0.1 million) on turnover of $6.6million (2005: $4.5 million). At that date, the Company had a cash portfolio of$7 million. The year ended 31 December 2006 was a disappointing year for the Company. InApril 2006, the Company decided to discontinue the card operations (theCompany's principal business at that time) but continued to support its existingcustomers. As a result of this decision, 17 employees including the chiefexecutive officer and chief financial officer ceased employment with theCompany. On 13 July 2006, the Company acquired Emblaze V CON, a company providing videoover-IP conferencing solutions to corporate customers, Under IFRS, theaccounting treatment requires that the transaction is treated as an acquisitionby Emblaze V CON. Accordingly, the financial statements for the year ended 31December 2006 reflect the trading results of Emblaze V CON for the full year andthe results of Zone-IP and its subsidiaries for the "post-acquisition" periodfrom 13 July 2006. Emblaze V CON develops and manufactures a variety of video conferencingsolutions that enable seamless communication and collaboration using all formsof interactive media. The company's award-winning technology ensures the highestaudio and video performance for organizations worldwide. Emblaze V CON's meetingand collaboration solutions include desktop and group videoconferencingproducts, audio conferencing products, data conferencing products and managementsystems. The company markets its products and services through a network ofreseller partners, OEMS and value-added resellers around the world. Emblaze VCON has worldwide headquarters in Israel and regional offices in Munich, Rome,London, New Jersey and Beijing. In September 2006, the Company announced it had relieved Mr. Moshe Leder of hisduties as chief executive of Emblaze V CON and that Mr. Tal Barnoach, anon-executive director of the Company, had agreed to take on temporary executiveresponsibilities pending the appointment of a new chief executive. Mr Barnoach conducted a strategic review of the Company's operations and coretechnologies. Following the review, the Company appointed a new VP R&D and a newVP Sales & Marketing and a new strategy plan was put forth. An overall changetook place to maintain focus on the Company's core business, strong execution,better visibility in the market and strengthened stronghold in emerging markets As a result, Emblaze V CON is planning a number of new product launches andupgrades in our existing product line in the first half of the current financialyear. Emblaze V CON intends to extend its range of products and service offeringto customers and enhance the technology of existing products. Emblaze V CON will endeavour to strengthen its leading position in Video-over-IP, focus on solution-based selling and enhance its relationships andpartnerships with industry technology and service providers. Current trading Trading in the first quarter of the current financial year is in line withmanagement's expectations, which were approved by the Board of directors inDecember 2006, following the strategic review. Future prospects The Directors expect that demand for communication tools using IP (InternetProtocol) standards will increase as corporations worldwide move to replace andconverge their legacy analog systems into more advanced IP based products. The Directors believe that the growing demand for visual communication solutionswill enable Emblaze V CON to achieve higher sales in 2007. Dr Hans WagnerChairman2 April 2007 CONSOLIDATED BALANCE SHEETU.S. dollars in thousands 31 December ----------------------------------------------- ----------------------------------------------- 2006 2005 ------------------- ------------------ ------------------- ------------------ ASSETS CURRENT ASSETS: Cash and cash equivalents 1,521 1,889 Restricted cash 237 - Short-term available-for-sale marketable securities 3,974 - Trade receivables (net of allowance of $ 179,000 and $ Nil at 31 December 2006 and 2005, respectively) 1,660 2,102 Other accounts receivable and prepaid expenses 387 330 Inventories 1,407 1,267 ------------------- ------------------ ------------------- ------------------ Total current assets 9,186 5,588 ------------------- ------------------ ------------------- ------------------ NON-CURRENT ASSETS: Long-term available-for-sale marketable securities 1,505 - Property and equipment, net 501 491 Intangible assets, net 894 1,138 ------------------- ------------------ ------------------- ------------------ Total non-current assets 2,900 1,629 ------------------- ------------------ ------------------- ------------------ Total assets 12,086 7,217 =================== ================== LIABILITIES AND EQUITY CURRENT LIABILITIES: Short-term bank credit 423 - Trade payables 1,549 1,264 Related party 513 331 Government grants 577 673 Employees and payroll accruals 628 1,030 Deferred revenues 471 141 Accrued expenses and other liabilities 639 400 ------------------- ------------------ ------------------- ------------------ Total current liabilities 4,800 3,839 ------------------- ------------------ ------------------- ------------------ NON-CURRENT LIABILITIES: Accrued severance pay 149 - Government grants 847 688 ------------------- ------------------ ------------------- ------------------ Total non-current liabilities 996 688 ------------------- ------------------ Total liabilities 5,796 4,527 ------------------- ------------------ ------------------- ------------------ EQUITY: Ordinary shares 109 66 Share premium 12,989 3,539 Net unrealized loss reserve (10) - Foreign currency translation reserve (2) (2) Accumulated deficit (6,796) (913) ------------------- ------------------ ------------------- ------------------ Total equity 6,290 2,690 ------------------- ------------------ ------------------- ------------------ Total liabilities and equity 12,086 7,217 =================== ==================CONSOLIDATED STATEMENT OF OPERATIONSU.S. dollars in thousands (except share and per share data) From For the year 9 August, 2005 (date ended of inception) to 31 December 31 December 2006 2005 ------------------- ------------------------- ------------------- ------------------------- Continuing Operations: Revenues 6,577 4,532 Cost of revenues (3,344) (1,418) ------------------- ------------------------- ------------------- ------------------------- Gross profit 3,233 3,114 ------------------- ------------------------- ------------------- ------------------------- Operating expenses: Research and development 3,018 841 Selling and marketing 3,816 1,720 General and administrative 1,714 423 ------------------- ------------------------- ------------------- ------------------------- Total operating expenses 8,548 2,984 ------------------- ------------------------- ------------------- ------------------------- Operating (loss)/income (5,315) 130 Financial expenses, net (37) (22) ------------------- ------------------------- ------------------- ------------------------- (Loss)/Profit for the period from continuing operations (5,352) 108 ------------------- ------------------------- ------------------- ------------------------- Discontinued Operations: Loss for the period from discontinued operations (531) (1,021) ------------------- ------------------------- ------------------- ------------------------- Loss for the period (5,883) (913) =================== ========================= =================== ========================= Loss per share: Basic and diluted loss per share from continuing operations $(0.13) $0.00 Basic and diluted loss per share from discontinued operations $(0.02) $(0.03) ------------------- ------------------------- ------------------- ------------------------- Basic and diluted loss per share $(0.15) $(0.03) =================== ========================= CONSOLIDATED STATEMENT OF CHANGES IN EQUITYU.S. dollars in thousands Foreign currency Net translation Total Share Share unrealized adjustments Accumulated recognized Total capital premium loss reserve reserve deficit expense equity --------------------------------------------------------------------------------------------------------- Balance as of 9 August 2005 (date of inception) - - - - - - Issuance of shares by EVC, net of issuance expenses 66 3,737 - - - - 3,803 Assumption of net liabilities of Esys Operation - (198) - - - - (198) Loss for the period - - - - (913) (913) (913) Foreign currency translation adjustments - - - (2) - (2) (2) --------------------------------------------------------------------------------------------------------- Balance as of 31 December 2005 66 3,539 - (2) (913) (915) 2,690 Assumption of net assets of Zone IP 43 9,450 - - - - 9,493 Net loss on available-for -sale financial assets - - (10) - - (10) (10) Loss for the period - - - - (5,883) (5,883) (5,883) --------------------------------------------------------------------------------------------------------- Balance as of 31 December 2006 109 12,989 (10) (2) (6,796) (5,893) 6,290 ========================================================================================================= CONSOLIDATED STATEMENT OF CASH FLOWSU.S. dollars in thousands From 9 August, 2005 (date of Year ended inception) to 31 December 31 December 2006 2005 ------------------ ------------------ ------------------ ------------------ Cash flows from operating activities: Loss for the period (5,883) (913) Adjustments to reconcile the loss for the period to net cash used in operating activities: Loss from discontinued operations 531 1,021 Depreciation and amortization 547 219 Decrease/(increase) in trade receivables 442 (2,102) Increase in other accounts receivable and prepaid expenses (57) (330) (Increase)/Decrease in inventories (140) 231 Increase in trade payables 285 1,264 (Decrease)/Increase in employees and payroll accruals (214) 468 Increase in accrued expenses and other liabilities 569 521 Increase in short and long term government grants 63 - Accrued severance pay, net (39) - ------------------ ------------------ ------------------ ------------------ Net cash flows provided by (used in) continuing operating activities (3,896) 379 Net cash flows used in discontinued operating activities (3) (531) (780) ------------------ ------------------ ------------------ ------------------ Net cash used in operating activities (4,427) (401) ------------------ ------------------ ------------------ ------------------ Cash flows from investing activities: Purchase of property and equipment (313) (110) Acquisition of assets from VCON - (1,631) Restricted cash (237) - Investment in marketable securities (12,139) - Proceeds from sale of marketable securities 6,650 - ------------------ ------------------ ------------------ ------------------ Net cash used in investing activities (6,039) (1,741) ------------------ ------------------ ------------------ ------------------ Cash flows from financing activities: Increase in short-term bank credit 423 - Issuance of shares, net - 3,803 Issuance of shares in connection with reverse acquisition 9,493 - Increase in related party 182 230 ------------------ ------------------ ------------------ ------------------ Net cash provided by financing activities 10,098 4,033 ------------------ ------------------ ------------------ ------------------ (Decrease)/Increase in cash and cash equivalents (368) 1,891 Effect of exchange rate changes on cash and cash equivalents - (2) Cash and cash equivalents at beginning of year 1,889 - ------------------ ------------------ ------------------ ------------------ Cash and cash equivalents at end of year 1,521 1,889 ================== ================== Notes to the financial statements 1. The financial information for the year ended 31 December 2005 isextracted from Emblaze VCON's financial statements to that date which receivedan unqualified auditor's report. The financial information for the year ended 31December 2006 is extracted from the Group's unaudited financial statements tothat date. 2. Loss per share The figures for loss per share are calculated on a loss of $5,883,000 (2005 -$913,000). The basic earnings per share calculation is based on a weightedaverage number of ordinary shares of NIS 0.01 each of 40,083,881 (2005:30,762,152). 3. Dividends No dividends have been declared for the year ended 31 December 2006. 4. Copies of the Report and Accounts will be sent to shareholdersshortly and will be available from the offices of the Company's nominatedadviser, John East & Partners Limited, Crystal Gate, 28-30 Worship Street,London EC2A 2AH. About Emblaze V CON Emblaze V CON is a leader in the development and deployment of Video over-IPConferencing Solutions, enabling enterprises of all sizes to optimize theirproductivity and efficiency through enhanced interaction and communication. TheCompany designs, develops, manufactures and markets high-performance,feature-rich desktop and group videoconferencing systems designed for a varietyof networks, including those based on the Internet Protocol (otherwise known as"IP") as well as infrastructure servers to manage the video network andservices. Emblaze V CON offers video conferencing and video communication solutions, whichare designed to meet and adapt to the needs of thousands of customers. Theintuitive, easy-to-use desktop communication tools maximize functionality,flexibility and control, while maintaining an uncompromising commitment toflawless audio and video experiences. The software solutions represent thesingle greatest deployment flexibility in today's market. Unlike hardwareproprietary products, which are dedicated and costly to implement, Emblaze VCON's software solutions run on standard hardware platforms and can be simplyintegrated into customer's existing network infrastructure. Emblaze V CON has customers in North America, Europe, Asia and Africa drawn froma broad range of sectors, including financial institutions, SMEs, largecorporates, universities and colleges, healthcare organizations and governmentalagencies. Emblaze V CON also sells to the ISP and telecommunications market,offering video-telephony services for the IPTV sector. Emblaze V CON has wholly-owned subsidiaries operating in the United States,France and Germany in order to market and sell its products. It also has anoffice in China. This information is provided by RNS The company news service from the London Stock Exchange