Earthport Regulatory News (EPO)

3 March 2014

Embargoed until 07:00

Earthport plc

("Earthport", the "Company" or the "Group")

Interim Results

Earthport (AIM: EPO.L), the cross-border payments services provider, is pleased to announce its unaudited interim results for the six months ended 31 December 2013.

Financial Highlights

· Revenue grew 81% to £3.32 million (H1 2013: £1.83 million)

o Average revenue of top 10 clients increased by more than 125%

o Includes two months of Baydonhill revenues post acquisition

o On a combined pro-forma basis, excluding discontinued clients, revenue growth of Earthport and Baydonhill was 42% in H1 2014 compared to H1 2013

· Gross profit increased by 80% to £2.56 million (H1 2013: £1.42 million)

· Gross margin broadly consistent at 77.11% (H1 2013: 77.60%)

· Loss before taxation, acquisition costs, interest and share based payment charges at £3.30 million (H1 2013: £3.74 million)

· Net cash used in operating activities of £3.02 million (H1 2013: £3.47 million)

· Cash and cash equivalents at 31 December 2013 of £8.19 million (31 December 2012: £9.63 million, 30 June 2013: £13.42 million)

o Cash outgoings include upfront acquisition cost net of cash acquired of £1.9 million for Baydonhill and one-off transaction costs of £0.44 million

Operational Highlights

· Most significant six months for Earthport as evidenced by major client wins with guaranteed revenues, revenue growth of existing clients and strategic positioning/recognition within the Industry:

o Major strategic agreement with Bank of America Merrill Lynch, signed in December 2013; guaranteed revenue from contract starting in January 2014

o 12 new customers were signed, 8 customers went live and a further 8 customers contracted but not yet live

o Other meaningful contracts, including additional Global banks, in negotiation and expected to close in the coming months

· Acquisition of Baydonhill in November 2013, proving to be a positive addition to both product offering and avenues of potential revenue

o Fully integrated and adding meaningfully to value propositions

· Banking network expanded to 60 countries, with more in progress

o IFC (part of World Bank) providing increasing accessibility to further geographies

· Healthy pipeline with existing and new customers, driven by strong market drivers

Post Period Highlights

· Record revenues achieved in January 2014; 25% revenue growth was achieved over December 2013, a previous record month for the Company

· Banking network expanded in Latin America , through new payment corridors in Mexico and Colombia

Hank Uberoi, CEO of Earthport plc, commented: "This period was a game changer for Earthport, driven by the fruitful investments made over the past few years. We continue to make significant progress in becoming the white-labelled utility infrastructure, globally, for low-value cross-border payments. It is encouraging to see that the pace of revenue growth is accelerating whilst margins are being maintained.

"We continue to achieve significant recognition across the payments industry, having now established a strong reputation as an innovator. This is reflected by the calibre of our client base. In particular, we were delighted to have signed a global agreement with Bank of America Merrill Lynch in December 2013; this strategic agreement represents a large, international opportunity across several of their payments services.

"Looking forward, we are confident in our abilities to continue to achieve traction with top-tier institutions, implement our service across the non-live clients, further expand our country coverage, and drive towards a positive cash flow position. Visibility has increased through contracts with minimum commitments, and we are on track to deliver on our forecasted revenue growth for the full year."

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About Earthport

Earthport plc, a regulated global financial services organisation, specialises in the provision of a white label cross-border payments service.

Through its innovative payments framework, specifically designed for high volumes of low value cross-border payments, Earthport provides a cost-effective and transparent service for secure international payments. Earthport's clients include banks, money transfer organisations, payment aggregators, e-commerce and foreign exchange businesses. Through Earthport's well established payments infrastructure, clients can clear and settle payments directly to banked beneficiaries in over 50 countries.

The company is headquartered in London and is listed on the Alternative Investment Market (AIM) on the London Stock Exchange. It operates globally with additional regional offices in Dubai and New York. Earthport plc is authorised and regulated by the Financial Conduct Authority under the Payment Service Regulations 2009 for the provision of payment services. To learn more, please visit www.earthport.com and follow us via RSS or on social channels, Twitter @Earthport, LinkedIn, Youtube and Slideshare.

Introduction

Earthport is a regulated, global financial services organisation providing a transparent and cost-effective white-labelled cross-border payments service, specifically designed to process high volumes of low value payments with a straight-through-processing efficiency rate of 99%+.

Earthport provides a unique service, and a much needed transparent alternative to existing outdated cross-border payment models. The addressable market is significant, and there are considerable positive drivers within the industry, including globalisation, international trade and regulations.

The Company's service proposition is attractive to a wide range of institutions needing or offering cross-border payment services, and who are challenged by the existing infrastructure and emerging regulatory demands placed on legacy platforms and processes.

The Board believes Earthport has become a non-competitive, but highly disruptive, offering in cross-border payments. Earthport has a partnership model, and its service can be white-labelled by any organisation conducting international payments in an agnostic and uncompetitive manner. Through product expansion and platform development we will support an ecosystem around our capabilities, driving major changes in the financial services industry and facilitating the creation of new business models.

As a regulated entity, Earthport operates strong compliance processes, controls and conducts a risk based analysis of clients. The adoption and enforcement of strict compliance procedures is positively received by our expanding and highly regulated customer base.

Operational Review

Earthport continues to gain strong traction across a number of verticals within the payment space.

Having now been adopted by a number of the world's largest financial services organisations, Earthport is in its own right a recognised innovator and leader. The Company's heightened profile, alongside the positive market drivers and lack of direct competition, have continued to add to Earthport's momentum during the half-year.

Revenues are growing at an accelerating pace, and the customer profile supporting this growth is encouraging. During the six months ended 31 December 2013, the Company further strengthened its proposition through the acquisition of Baydonhill, a foreign exchange service provider. This was a major strategic move for the Group. During 2013, Earthport took the decision to not build-out its own FX capability, despite increasing customer demand and potential for this functionality, and instead acquired Baydonhill, an FX business that was an existing client of the Company. On completion of the acquisition the two businesses, due to their existing relationship and that they operated from the same premises, were integrated immediately, with resultant synergies to the Group accruing from day one. This acquisition continues to provide additional revenue channels and opportunities for the enlarged group. The acquisition also provided revenue and cost saving synergies, primarily through a pooling of shared resources and assets.

During the six months ended 31 December 2013, revenues increased strongly by 81% to £3.32 million (H1 2013: £1.83 million), though Earthport does not consider current revenues to be indicative of the Company's potential. Margins were maintained at approximately 77%, and gross profits increased by 80% to £2.56 million (H1 2013: £1.42 million). The first half of 2013 includes a two month contribution from Baydonhill. On a combined pro-forma basis, excluding discontinued clients, revenue growth of Earthport and Baydonhill was 42% in H1 2014 compared to H1 2013.

Although December 2013 was a record month for the Company, January 2014 recorded 25% revenue growth over December 2013.

Increasing customer momentum

During the six months ended 31 December 2013, 12 new customers were signed and 8 customers went live, with a further 8 customers contracted but not yet live.

Earthport's pace of growth is accelerating, due to existing clients continuing to grow revenues, and also due to the increasing size of new customers signing-up and going live with the service. The average revenue of Earthport's ten largest clients was up 125% in H1 2014 compared to H1 2013, and of these, five were new to the top ten list.

Traction demonstrates uniqueness of core infrastructure offering

Earthport continues to gain agreements with the largest organisations in the global financial services industry. The Company has established a position as a core infrastructure for efficient international payments, which is now resulting in the signing of significant contracts with guaranteed revenues. This is pleasing given that implementation across larger organisations can be a lengthy and arduous process. Earthport has also, through its investment, become part of the IFC's extensive network which includes over 900 financial institutions; this provides Earthport with access to potential partners and clients in key geographies.

Earthport is enjoying considerable success in signing contracts with some of the leading businesses across a number of key sectors - banks, corporates and payments platforms. Many of these relationships are in the early stages of implementation, and the Company has in place the systems and process in anticipation of accelerated growth going forward. The pipeline of business with both new and existing customers continues to increase.

In December 2013, Earthport was delighted to announce the progression of its relationship with Bank of America Merrill Lynch (NYSE:BAC), and the signing of a worldwide contract to expand the bank's low value clearing capabilities and advance the efficiency of its high volume, low value payments. Earthport signed an initial agreement with Bank of America Merrill Lynch in December 2012 for a specific payments service in North America. This new agreement covers several of Bank of America Merrill Lynch's payments services worldwide, and therefore represents a significant expansion. Commercial terms of this contract include minimum revenue to Earthport of $11.3 million, with the majority of the revenue anticipated within the first 30 months of the agreement. The global agreement is now live and began to generate revenues in January 2014. Importantly, there are no exclusivities or limitations on Earthport related to other clients or potential clients as part of this agreement. This contract has acted as a significant endorsement that advocates the Earthport service to other international banks and payment processers.

The level of revenues from clients included in the period to 31 December 2013 is not indicative of future prospects as many significant customers are in implementation phase. Several of these relationships are expected to start generating revenues in the future as services are launched and go-live. Volumes typically follow four to eight months after contracting with a client, with larger clients taking longer than smaller ones to adopt the service.

Earthport has included minimum revenue commitments in recent contracts; this provides significant revenue contribution during the integration and adoption phase of certain contracts. Earthport is also undertaking several consulting engagements with existing and new customers, which are currently contributing professional services fees in the lead up to formal contractual agreements and anticipated full implementations.

The framework supported by Earthport's innovative service enables an ecosystem which is also supportive of new business models, which otherwise would be restricted due to the shortcomings of traditional global payment infrastructures. Several early stage businesses are building through the use of Earthport and we see this as a continuing trend.

Banking network continues to expand

Earthport's banking network is one of its key assets. Global organisations such as Bank of America Merrill Lynch have chosen Earthport due to its extensive and growing country coverage. During the period Earthport continued to expand its banking network, which now stands at 60 countries (H1 2013: 55).

Further network expansion is in process and in February 2014 Earthport announced new payment corridors into Mexico and Colombia (included in the 60 countries) to broaden its footprint in the Latin American region. The addition of Mexico enables Earthport to serve three of the top four remittance destinations globally.

In May 2013, during the prior fiscal year, Earthport received investment from the IFC, the world's largest private sector development institution. The funds are being used to expand Earthport's global presence and payments service infrastructure, particularly in developing countries in order to drive financial inclusion. In many developing nations, the annual level of international remittance from citizens working abroad can be between 7% and 35% of the nation's Gross Domestic Product. Much of this continues to be carried out via traditional methods, which can be both costly and cumbersome. The relationship with the IFC has facilitated progress with countries that for others would be inaccessible.

Significant growth market, served by antiquated technology

Earthport has a healthy pipeline of opportunities with existing and new customers, underpinned by strong market drivers that support long-term growth in a market that is vast.

The proliferation of internet-enabled global trade and eCommerce has contributed greatly to an explosion in global payments. At the same time, globalisation has led to an increasingly global workforce, which in turn is multiplying the numbers of remittance payments and the variety/complexity of country-networks. These remittance payments are often of relatively low value but high volume, and are increasingly bank-to-bank as opposed to cash delivery. Global remittances are expected to reach USD$594 billion by 2014, of which USD$449 billion will flow to developing countries (The World Bank 2013). The inefficiencies of traditional cross-border payment methods can have a dramatic effect, and due to this the G8 pledged to an objective in 2009 to reduce the cost of international remittances from 10% to 5% in 5 years, the '5 x 5 initiative'.

Consumer protection regulation and initiatives in response to these trends are emerging in order to encourage greater transparency in cross-border payments in terms of cost and delivery timing. In North America, Dodd-Frank Act (Section 1073), impacts institutions that transmit consumer originated payments out of North America and is expected to be fully implemented by US regulators in 2015. In Europe, the Payments Services Directive (PSD) increases the level of transparency in payments services throughout the European Union (EU) and European Economic Area (EEA) to ensure consumers are aware of fees. 

Earthport is perfectly placed to enable banks to meet the measures being put in place to increase the oversight of international transfers. The very nature of other, traditional open-loop (correspondent banking or wire) payment systems makes it extremely difficult for any institution to understand and easily disclose to the consumer when a payment will arrive, what the upfront charges are and how much the beneficiary will receive.

Pipeline healthy and sales team bolstered

Alongside Earthport's profile within the industry, market drivers have led to strong traction in the sales pipeline. For instance, Earthport is well placed to help banks with a permanent solution to Dodd-Frank 1073 and is engaged in revenue-generating opportunities in this space. Accordingly, Earthport has accelerated its sales efforts aligned to this market opportunity.

Earthport's sales pipeline is growing at such a pace that opportunities are evaluated and pursued on a priority-basis. To support these opportunities, five experienced individuals have been added to the Company's sales team. Earthport also has channel partner programmes which complement its direct to market sales activity.

Strong, industry-leading presence

Earthport takes part in steering committees, industry presentations and hosts webinars alongside some of the world's largest banks and technology providers. The Company's presence exceeds that which is typical for its size, reflecting Earthport's unique position within the international payments ecosystem. During the half, Earthport participated at some of the largest and notable financial services industry events. A highlight was contributing to the opening Innotribe session of SIBOS in September 2013 in Dubai, where Hank Uberoi discussed how banks can adapt existing infrastructure to respond faster to customer demand for innovation. Another highlight was presenting to the largest gathering of innovators in emerging payments and financial services globally at Money 2020 in October 2013, on how innovations in financial services can enable more cost efficient and transparent international transfers.

Earthport will again over the forthcoming months present or exhibit at a number of events, including NACHA in April 2014, EBAday in June 2014, Sibos in September and Money 2020 in November 2014. Information on these can be found online at www.earthport.com/events/recent-eventsand associated materials can also be found online at www.earthport.com/what-we-think/industry-presentations.

Service Enhancements

Earthport's platform has been specifically developed to process high-volume, low monetary value transactions. Its worldwide payment network and team provide an unparalleled services that processes transactions on a white-label basis.

We are continuing to expand the product capabilities to better leverage our assets and serve our clients with additional payment-related services. The acquisition of Baydonhill is in-line with this objective, and provides enhanced and integrated foreign exchange capabilities to Earthport's customers so that they can effectively outsource the entirety of a cross-border payment to Earthport on a white-labelled basis.

Functionality and other service improvements across the Earthport payments platform have centred on both strategic initiatives and customer requested enhancements. The Company will continue to invest in the scalability, robustness and functionality of its platform as it rolls out with customers.

Financial Review 

In comparison to the corresponding period last year, revenue increased by 81% to £3.32 million (H1 2013: £1.83 million). During the six months ended 31 December 2013, the increase in revenues has been driven by the acquisition of Baydonhill, payment transactions, minimum revenue contracts, and consulting engagements that generate professional services fees.

Record revenues were recorded in both December 2013 and January 2014; revenues for January 2014 were 25% higher than December 2013.

On a combined pro-forma basis, excluding discontinued clients, revenue growth of Earthport and Baydonhill was 42% in H1 2014 compared to H1 2013 (H1 2013 pro-forma revenue of £2.33 million).

Gross profit for the period was up 80% to £2.56 million (H1 2013: £1.42 million) and gross margin was broadly consistent at 77%, compared to 77.6% in the prior period.

Administrative expenses increased by 14% to £5.87 million (H1 2013: £5.16 million). As anticipated at the time of the final results, announced in November 2013, Earthport has increased the sales team headcount and will continue to invest in line with growth, its increasing customer base, pipeline and implementation projects underway.

Since being acquired, Baydonhill has contributed positively to revenues and profits. In the two full months of trading to the period-end, Baydonhill's margins were broadly consistent with Earthport's margin profile. The associated acquisition costs totalled £0.44 million during the half-year period.

Operating loss, before acquisition costs and a share based payment charge of £1.03 million (H1 2013: £0.77 million), decreased by 11.76% to £3.30 million (H1 2013: £3.74 million). The operating loss for the six months increased by 5.76% to £4.77 million (H1 2013: £4.51 million). A charge of £0.07 million has been recognised for the warrants granted during the period to Bank of America Merrill Lynch. Overall, Earthport's loss before and after taxation increased by 7.1% to £4.83 million (H1 2013: £4.51 million).

Cash and cash equivalents as at 31 December 2013 were £8.19 million (30 June 2013: £13.42 million, 31 December 2012: £9.6m). The upfront net of cash acquired cost of Baydonhill amounted to £1.9 million.

Like for like net cash used in operating activities decreased to £3.02 million (H1 2013: £3.47 million). The continuing decrease in net cash used in operating activities continues to demonstrate that a turning point in terms of cash used versus revenue growth has been reached. Base costs are not expected to increase other than related to specific revenue producing activities such as delivery of professional services.

Bank of America Merrill Lynch Warrants

Under the terms of the agreement signed in December 2013, Earthport granted warrants at a strike price of 24.2 pence per ordinary share over 17.3 million new ordinary shares to Bank of America Merrill Lynch. Bank of America Merrill Lynch may receive additional warrants over a further maximum of up 19.3 million new ordinary shares at a strike price of 31 pence per ordinary share if it delivers payment revenues to Earthport that materially exceed the minimums under the commercial contract.

The terms of the warrants include limited anti-dilution provisions for the benefit of Bank of America Merrill Lynch in certain circumstances. The Board considers that any such provisions are unlikely to be triggered.

Acquisition of Baydonhill

In September 2013, Earthport announced it had reached an agreement on the terms of a recommended cash offer of the entire issued share capital of currency exchange broker service, Baydonhill. Earthport had worked with Baydonhill for several years and the product offering and expertise represented an ideal fit with Earthport's strategy to provide a comprehensive, white-labelled cross-border payment service.

This was a major strategic move for Earthport. Baydonhill was a client of Earthport and in 2013 Earthport took the decision to not build-out its own FX capability, despite increasing customer demand and potential for this functionality and instead acquired Baydonhill in order to deliver this capability. On completion of the acquisition, the two businesses, due to their existing relationship and that they operated from the same premises, were integrated immediately, with resultant synergies to the Group accruing from day one. This acquisition continues to provide additional revenue channels and opportunities for the enlarged group.

The cash offer valued Baydonhill at approximately £6.42 million on the basis of a fully diluted share capital of Baydonhill. Since 84.2% of the Baydonhill shareholders accepted the earn-out offer, the upfront cash amounted to £3.37 million. If the full earn-out is achieved, an additional £1.28 million in cash and 13,799,042 Earthport shares will be issued; the additional cash will be funded from Baydonhill's future cash flows. Baydonhill had an outstanding loan amounting to £474,000 which Earthport also attained through the acquisition.

As anticipated, the acquisition has proved an advantageous, strategic opportunity for Earthport to augment its current foreign exchange services. Earthport is already providing additional services and expertise to existing clients. The acquisition also provided revenue and cost saving synergies, primarily through a pooling of shared resources and assets.

Outlook

Within the payments industry, Earthport is becoming synonymous with cross border transactions. Earthport is achieving the momentum necessary in order to be able to realise its goal of becoming the core white-labelled utility infrastructure for low value payments, globally. There is a growing acceptance of outsourcing services, and the industry is experiencing a shift towards collaboration.

The Company's traction with some of the most sophisticated global banks underlines the opportunity, and although the accelerating rates of growth are encouraging, the business has significant further potential. Several key customers are still in implementation phase and are yet to go live. In addition, the pipeline with both new and existing customers continues to increase, and there remain significant opportunities across several other payment verticals.

Earthport has a significant market opportunity; there are strong drivers including regulatory change and the barriers to entry are high. Although the timings can be difficult to predict due to the sales and implementation process typically being lengthy, the levels of minimum revenues associated with certain contracts are providing increasing visibility. The Company therefore remains confident in its ability to achieve positive cash flow position within the expected timeframe. Current growth rates indicate that we are on track to deliver on our forecasted triple-digit revenue growth for the full year.

The focus over the second half of the year and beyond will be on growing revenue from existing and new clients, going live with clients still in implementation phases, adding countries to the payment network, and continuing to implement consultancy projects with non-signed potential customers ahead of anticipated formal relationships. Earthport has in place the systems, key customers, extensive marketing, corporate profile and growing network reach to produce accelerated growth in the years to come and continues to view the future with confidence.

The Board

3 March 2014

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 31 December 2013

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

at 31 December 2013

CONSOLIDATED STATEMENT OF CASH FLOWS

for the six months ended 31 December 2013

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Six months ended 31 December 2012 (Unaudited)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Six months ended 31 December 2013 (Unaudited)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Year ended 30 June 2013 (Audited)

notes to the INTERIM results

for the six months ended 31 December 2013

1. GENERAL INFORMATION

Earthport plc is a public limited company incorporated and domiciled in the England and Wales under the Companies Act 2006. The address of its principal place of business and registered office is 21 New Street, London EC2M 4TP.

2. GOING CONCERN

The interim financial information has been prepared on the assumption that the Group is a going concern.

When assessing the foreseeable future the directors have looked at a period of twelve months from the date of approval of the interim financial information. The directors believe that the Group has demonstrated progress in achieving its objective of positioning the Group as an infrastructure supplier to the global payments industry, and therefore consider that it is appropriate to prepare the Group's interim financial information on a going concern basis, which assumes that the Company is to continue in operational existence for the foreseeable future.

3. ACCOUNTING POLICIES

Basis of preparation

The interim financial information is prepared using accounting policies consistent with International Financial Reporting Standards ("IFRS'') as adopted by the European Union.

The financial statements have been prepared under the historical cost convention and the principal accounting policies are set out in the 30 June 2013 financial statements.

notes to the INTERIM results

for the six months ended 31 December 2013

4. LOSS PER SHARE

Loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period.

The loss attributable to Ordinary shareholders and weighted average number of ordinary shares for the purposes of calculating the diluted loss per share are identical to those used for basic loss per ordinary share. This is because the exercise of share options and other benefits would have the effect of reducing loss per share and is therefore not dilutive under the terms of IAS33 "Earnings per share".

5. TRADE AND OTHER RECEIVABLES

notes to the INTERIM results

for the six months ended 31 December 2013

6. TRADE AND OTHER PAYABLES

Trade payables and accruals principally comprise amounts outstanding in respect of operating costs. The directors consider that the carrying amounts for trade and other payables approximate their fair value.

7. SHARE CAPITAL

Authorised

The Articles of Association were amended on 24 March 2010. The Company has no authorised share capital limit.

Issued

During the period ended 31 December 2013: 3,165,248 ordinary shares of 10p were issued against cash consideration (i.e. exercise of warrants) and 600,282 ordinary shares of 10p were issued in lieu of fees.

Deferred shares carry no rights to receive any dividend nor other distribution. The holders of the deferred shares have no rights to receive notice, nor attend, speak or vote at any general meeting of the Company. On a return of capital on liquidation or otherwise, the holders of the deferred shares are entitled to receive the nominal amount paid up on the deferred shares after the repayment of £10,000,000 per ordinary share.

notes to the INTERIM results

for the six months ended 31 December 2013

8. SHARE PREMIUM

9. OWN SHARES

10. RECONCILIATION OF LOSS BEFORE TAX TO NET CASH OUTFLOW FROM

OPERATING ACTIVITIES

notes to the INTERIM results

for the six months ended 31 December 2013

11. ACQUISITION/BUSINESS COMBINATION

On 1 November 2013, the Company acquired 100% of Baydonhill for an initial cash consideration of £3.4m and a deferred consideration of £2.7m depending on Free Cash Flow of Baydonhill under the Earn-out Offer.

The Group is still in the process of establishing the fair value of the assets and liabilities acquired but it is anticipated that the fair value of the consideration paid over the book value of the net assets acquired will comprise customer relationships, online system, trade names and goodwill representing the value attributable to new business, the assembled and trained workforce. The table below summarises the provisional fair value of assets and liabilities of Baydonhill at the date of acquisition.

12. PUBLICATION OF NON-STATUTORY FINANCIAL STATEMENTS

The results for the six months ended 31 December 2013 and 31 December 2012 are unaudited and have not been reviewed by the auditor. The results for the year ended 30 June 2013 do not constitute statutory financial statements as defined in section 434 of the Companies Act 2006, but have been derived from the full audited financial statements for the year ended 30 June 2013. Statutory accounts for the year ended 30 June 2013, on which the auditors gave an audit report which was unqualified and did not contain a statement under section 498(2) or (3) of the Companies Act 2006, have been filed with the Registrar of Companies.

The interim financial information has been prepared on the basis of the same accounting policies as published in the audited financial statements for the year ended 30 June 2013 and the accounting policies to be adopted in the financial statements for the year ended 30 June 2014. The annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards and International Financial Reporting Interpretations Committee ("IFRIC") pronouncements as adopted by the European Union. Comparative figures for the year ended 30 June 2013 have been extracted from the statutory financial statements for that period.

13. The interim results for the six months ended 31 December 2013 are available on the Company's website: www.earthport.com.