MIRA.L Regulatory News (MIRA)

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

 

 

28 September 2018

 

Mirada plc

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

 

Final Results for the Year Ended 31 March 2018

 

Mirada plc (AIM: MIRA), the leading audio-visual content interaction specialist, announces its final results for the year ended 31 March 2018.

 

Financial Highlights

· Revenue increased to $8.82 million (2017: $8.49 million). The decrease in revenues with izzi Telecom (Televisa group) after the Peso devaluation in Dec 2016 and izzi Telecom freeze of purchases in USD was offset by the revaluation of USD vs EUR, which has contributed to $0.63 million additional revenues.

· Gross profit increased to $7.94 million (2017: $7.88 million)

· Operating loss reduced to $4.62 million (2017: loss of $6.57 million)

· Net loss reduced to $4.87 million (2017: loss of $7.10 million)

 

Operational Highlights

· Contract win with ATN International Inc. (ATNi) for deployments in the Caribbean.

· Contract win with Digital TV Cable Edmund S.R.L. in Bolivia.

· New business model, with lower set-up fees leading to recurrent long-term revenues from subscriber-based licence fees on Software as a Service (SaaS) agreements.

· Temporary reduction of izzi Telecom (Televisa Group) investment on professional services during the year resulting from uncertainties in the Mexican economy due to the November 2016 US elections.

· Deployment from March 2018 of Iris multiscreen licenses over new segments of subscribers at izzi Telecom resulted in higher monthly installations and an increase of more than $1.5m in licence-fees collections post year end, since April 2018.

· Secured £4.7 million in Facilities from Kaptungs, Minles and Kronck (£1.7 million in November 2017 and £3.0 million in March 2018). In the General Meeting held on August 29th, 2018 it was approved to convert the £1.7 million facility into shares. In the General Meeting to be held on October 4th, 2018 it is proposed to increase capital by £6.0 million, with £3.0 million in cash and with £3.0 million by discharging Mirada Plc from its liability to pay to Kaptungs £3.0 million in accordance with the terms of the second Facility Letter mentioned above, in consideration for the Borrower treating such discharged amount as payment in full for the subscription of 300,000,000 ordinary shares of 1p each in the capital of the Borrower at a subscription price of 1p per new ordinary share, each credited as fully paid up of an additional £3.0 million.

 

 

 

 

Jose Luis Vazquez, CEO of Mirada, commented: 

"Mirada participated in a significant number of advanced stage tenders during the year and is seen as an increasingly relevant supplier as new bids appear in the market. I am glad to say that we currently have a strong pipeline in terms of the number of opportunities we are participating in. This pipeline and an increasing number of successful references is helping us secure new opportunities and we are confident of announcing new relevant contract wins in the near future."

Annual Report and Accounts

The Company's Annual Report and Accounts will be available on the Company's website, www.mirada.tv, and posted to shareholders today.

 

Enquiries

Mirada plc José Luis Vázquez, Chief Executive Officer Gonzalo Babío, Chief Financial Officer	+44 (0) 207 868 2104 investors@mirada.tv
Newgate Communications Bob Huxford Tom Carnegie   Allenby Capital Limited (AIM Nominated Adviser and Broker) Jeremy Porter Alex Brearley Liz Kirchner	+44 (0) 207 680 6550 mirada@newgatecomms.com       +44 (0) 20 3328 5656

About Mirada

Mirada is a leading provider of products and services for Digital TV Operators and Broadcasters. Founded in 2000 and led by CEO José Luis Vázquez, the Company prides itself on having spent almost 20 years as a pioneer in the Digital TV market. Mirada's core focus is on the ever-growing demand for TV Everywhere for which it offers a complete suite of end-to-end modular products across multiple devices, all with innovative state-of-the-art UI designs.

Mirada's products and solutions, acclaimed for unparalleled flexibility and optimal time to market, have been deployed by some of the biggest names in digital media and broadcasting including Televisa, Telefonica, Sky, Virgin Media, BBC, ITV and France Telecom. Headquartered in London, Mirada has commercial representation across Europe, Latin America and Southeast Asia and operates technology centres in the UK, Spain and Mexico. For more information, visit www.mirada.tv

 

 

 

Chief Executive Officer's Statement

 

Overview

I am pleased to present the Group's financial results for the year ended 31 March 2018. During this period the Group focused on achieving and delivering new contract wins, notably with ATNi in the United States and Digital TV Cable Edmund S.R.L. ("Digital TV Cable") in Bolivia, whilst improving the market reach and ensuring a top-level service to present customers. Mirada was able to implement the transition to the new Software as a Service (SaaS) business model, securing long-term recurrent revenues from the new deals. As a result of our sales and marketing efforts, we increased our number of referrals, leveraging the excellent job our technical team performed at izzi Telecom. Also, and despite harsh conditions in the Mexican market due to the peso volatility after the US Elections, we were able to reinforce our relationship with our largest customer (izzi Telecom). This, resulted in the extension of the deployment of our technology over new customer segments and while improving the on-going monthly licence-fee revenues for Mirada.

 

Trading Review

The two major milestones for the fiscal year under review were the contract wins of ATNi and Digital TV Cable. Both customers joined our new SaaS business model, which allows them to benefit from our support and maintenance and product updates on a timely manner, paying a monthly fee per subscriber with minimum guaranteed revenues. Although the set-up fees in this model are smaller than in the previous one, the contract value is not eroded and guarantees recurrent long-term licence fees, giving us much better visibility on medium and long-term revenues. SaaS agreements account for a continued growth of the customer subscribers base, typically over three to five years, with minimum guaranteed revenues aligned with this growth. Customers perceive that the model is aligned with their business plans, increasing Mirada's chance to land new deals. Both technical deployments ran smoothly, helping to improve Mirada's efficiency as we accumulate deployments of the Iris Inspire multiscreen product, and we plan to announce the commercial launch of both customers within this fiscal year.

In the case of ATNi, we plan to announce the first deployment very shortly, with others following over this and the next fiscal year. Recurrent (monthly / quarterly) subscriber-based licence fees from both customers will start on the commercial deployments and ramp-up as these customers grow.

Our largest reference, izzi Telecom (part of the Televisa Group) continued to experience uncertainties resulting from the election of Donald Trump as president of the United States of America. izzi Telecom drastically decreased investments in foreign goods and services denominated in US Dollars, which is our default trading currency out of Europe. This had a short-term impact in the professional services contracted by izzi Telecom, especially during the first half of the year. This situation normalised after a few months, with higher confidence in the market during the second half of 2017. Additionally, post year end, in preparation for the FIFA World Cup there was a peak in related required professional services from izzi and other customers which will positively impact our revenues for the fiscal year ended 31 March 2019.

As a result of the continued relationship with izzi Telecom, and the successful deployment of our Iris Inspire solution, izzi decided to extend the deployment of the solution over a wider segment of its customer base. Mirada's product is now being installed over the middle and premium tiers, which has resulted in higher monthly installations and a post-year end increase of more than $1.5m in licence-fee, collections since April 2018. On the Over the Top (OTT) licences, the penetration of this product in the market is growing to ratios comparable to other regions like Western Europe, where households with OTT services added to the traditional Pay-TV subscription represent over 50% of the subscribers. Post year end, and using the FIFA World Cup momentum, izzi decided to promote their OTT service for users which have not currently installed Mirada's product in their households, and which still represent the vast majority of their subscriber's base. izzi is committed to the promotion of Mirada's OTT product over their platform, and we expect this to be reflected positively in our OTT-related revenues this year.

At 31 March 2018 izzi Telecom had over a million set-top boxes installed with our product, in nearly five hundred-thousand households. Currently izzi Telecom has over 4 million subscribers, of which Mirada represented roughly 13% of their base at fiscal year-end. At the present date, izzi Telecom has 1.5 million set-top boxes installed with our technology.

The Group remains committed to its sales and marketing efforts, and aims to close more deals in the present fiscal year. The pipeline continues to grow, powered by the increasing number of references and a very solid product, and the fact that our main customers are intensively using our technology at the forefront of their service delivery. The fact that izzi Telecom decided to actively promote our OTT product over their multi-million subscription base is a very strong selling point that very few competitors can match.

Our cashless payment parking (Mobile) division, independent from our Digital TV division, continues to deliver solid growth with a 20% increase in revenue, generating profits before tax this year of $0.2m (2017: $0.16m), contributing to 10.0% of total revenue in the current year (2017: 8.6%).

In May 2018, post year-end, we suffered the tragic and sad loss of Mr Javier Casanueva, who was a friend and a partner for many years, and a cornerstone for the successful deployment of Mirada. We will greatly miss him. Francis Coles, a long-standing non-executive Director, took the role of non-executive Chairman later in the month. We wish him the best for the new position.

With a growing pipeline, more references and a solid product that our customers are using more and more, we can only aim to continue deploying the business model and win more references. The business model is proving solid and with a higher percentage of revenues coming from recurrent subscriber-based licence fees, we are steadily reaching the point of profitability. We could not do all this without the continued support of our stakeholders: employees, customers, suppliers, partners and investors, to whom we are extremely grateful.

Financial overview

Revenue grew to $8.82 million (2017: $8.49 million). However, there was a decrease in revenues with izzi Telecom (Televisa group) after the Peso devaluation in December 2016 and izzi Telecom freeze of purchases in USD. This was offset by the revaluation of USD vs EUR, which has contributed to $0.63 million additional revenues.

 

Although gross profit grew to $7.94 million (2017: $7.88 million), there is a noted decrease in the gross margin percentage of 3.6% due to the additional cost associated with the increased number of sales representatives. Staff costs have increased due to the strengthening of the sales team and due to the contract wins under the Software as a service business model (ATNi and Digital TV cable). Operating loss decreased to £4.62 million (2017: £6.57 million). Adjusted EBITDA (as defined in Note 6) for the year decreased to a loss of $1.12 million (2017: loss of $0.04 million) resulting mainly from the efforts to win and deploy the new deals. Amortisation charges increased to $3.35 million from $2.72 million, due to increased product development investment, related to Cloud and kids functionalities. There is a tax credit recognised in the current period as a result of Mirada Iberia's capitalisation of research and innovation tax deductions.

The Group reduced its net loss for the year to $4.87 million compared to a loss of $7.10 million in the prior year. This improvement, resulted from a combination of the following factors: the one-off goodwill impairment applied in the financial year ended in March 2017 and the different revenue mix from increased licences this year.

Net Debt rose to $11.70 million (2017: $5.25 million) as a result of increased product investment, lower than expected Televisa revenue for the year, and the required investment in the new contracts signed under the Software as a Service ("SaaS") business model. Long term interest-bearing loans and borrowings decreased by 14% to $2.48 million (2017: $2.88 million) and short term borrowings increased to $11.16 million (2017: $2.66 million). Trade receivables increased from $0.99 million to $1.38 million, due to a $0.66m invoice to izzi Telecom billed in March 2018 and collected in April 2018.

The Company signed two debt facilities with related parties, one of £1.7 million in November 2017 which was converted post year end (August 29th, 2018) into equity, and a £3.0 million facility which was agreed to be capitalised alongside an additional capital injection of £3.0 million. These are subject to shareholder approval on October 4th, 2018. Both facilities were provided by our largest shareholders, showing their commitment to the business model. We are confident that the reduction in Net Debt will help in deploying new opportunities, both from the additional available working capital and due to the increased confidence of our Customers in our ability to develop the contracts.

Other intangible assets have increased by $1.14m mainly due to the increased valuation of the Euro against the US Dollar.

Cash at bank increased to $1.94 million from $0.28 million, mainly due to the £3.0 million facility received from Kaptungs in March 2018. Additional invoice discounting facilities of $1.34 million and unused short-term credit lines of $0.37 million were available at the end of March 2018.

The Group used $1.7m of cash in operating activities in the year (2017 - generated cash from operating activities of $3.3m) and spent a further $3.9m (2017 - $3.5m) in investing activities, primarily related to developing the Group's software platform. This was funded through the facilities described above.

As set out in note 2 of the financial statements, given the funding needs of the Group, a General meeting has been called for October 4th, 2018, to approve a £3m cash injection required for the Group to continue as a Going Concern. See Note 2 for further details.

In this period, the Board decided to change the reporting currency for this year due to the growing exposure to the US Dollar, as all major contracts and most on the new potential deals for the Company are denominated in this currency. Coupled with the evolution of the business, the Group's shareholder base is now largely comprised of foreign investors to whom financial reporting in GBP is of limited relevance. Internally, the board also bases its performance evaluation and the majority of investment decisions on USD financial information. The exchange rate fluctuation between GBP and USD from March 2017 to March 2018, (1: 1.24775 to 1: 1.40795) has resulted in a consequent currency translation gain of $1 million.

Current Trading and Outlook

Mirada participated in a significant number of potential deals during the year and is seen as an increasingly relevant supplier, as new bids appearing in the market. I am glad to say that we currently have a strong pipeline in terms of the number of opportunities we are participating in. This pipeline and an increasing number of successful references is helping us secure new opportunities and we are confident of announcing new relevant contract wins in the near future.

 

José-Luis Vázquez Chief Executive Officer 27th September 2018

 

 

 

 

Mirada plc

Consolidated Statement of Comprehensive Income at 31 March 2018

 

	2018	2017
		(Restated)
	$000	$000
Revenue	8,816	8,489
Cost of sales	(874)	(614)
Gross profit	7,942	7,875
Depreciation	(73)	(46)
Amortisation	(3,352)	(2,718)
Share-based payment charge	(72)	(69)
Staff costs	(5,599)	(4,802)
Goodwill impairment	-	(3,744)
Other administrative expenses	(3,464)	(3,070)
Total administrative expenses	(12,560)	(14,449)
Operating loss	(4,618)	(6,574)
Finance income	84	3
Finance expense	(634)	(423)
Loss before taxation	(5,168)	(6,994)
Taxation	298	(103)
Loss for year	(4,870)	(7,097)
Currency translation differences	999	(763)
Total comprehensive loss for the period	(3,871)	(7,860)
Loss per share	Year ended 31 March 2018	Year ended 31 March 2017
		(Restated)
	$	$
Loss per share for the year
- basic & diluted	(0.035)	(0.051)

 

 

 

Mirada plc

Consolidated Statement of Financial Position as at 31 March 2018

 

Company number 3609752	2018	2017	2016
		(Restated)	(Restated)
	$000	$000	$000
Goodwill	6,492	5,643	10,111
Other Intangible assets	7,072	5,936	5,580
Property, plant and equipment	247	141	135
Deferred Tax Assets	-	-	568
Other Receivables	308	635	274
Non-current assets	14,119	12,355	16,668
Trade & other receivables	4,484	3,214	5,418
Cash and cash equivalents	1,937	277	1,025
Current assets	6,421	3,491	6,443
Total assets	20,540	15,846	23,111
Loans and borrowings	(4,246)	(2,655)	(3,471)
Related parties loans and interests	(6,917)	-	-
Trade and other payables	(2,320)	(1,384)	(1,867)
Deferred income	(1,360)	(1,844)	(326)
Current liabilities	(14,843)	(5,883)	(5,664)
Net current liabilities	(8,422)	(2,392)	779
Total assets less current liabilities	5,697	9,963	17,447
Interest bearing loans and borrowings	(2,477)	(2,875)	(2,542)
Other non-current liabilities	-	-	(26)
Non-current liabilities	(2,477)	(2,875)	(2,568)
Total liabilities	(17,320)	(8,758)	(8,232)
Net assets	3,220	7,088	14,879
Issued share capital and reserves attributable to equity holders of the company
Share capital	2,261	2,261	2,261
Share premium	15,760	15,760	15,760
Other reserves	15,985	14,997	15,753
Accumulated loss	(30,786)	(25,930)	(18,895)
Equity	3,220	7,088	14,879

 

 

 

Mirada plc

Consolidated Statement of changes in equity for the year ended 31 March 2018

 

	Share capital	Share premium	Foreign exchange reserve	Merger reserves	Accumulatedlosses	Total
	$000	$000	$000	$000	$000	$000
Balance at 1 April 2017 (Restated)	2,261	15,760	10,134	4,863	(25,930)	7,088
Loss for the year	-	-	-	-	(4,870)	(4,870)
Other comprehensive income
Movement in foreign exchange	-	-	988	-	11	999
Total comprehensive loss for the year	2,261	15,760	11,122	4,863	(30,789)	3,217
Transactions with owners
Share-based payment	-	-	-	-	3	3
Balance at 31 Mar 2018	2,261	15,760	11,122	4,863	(30,786)	3,220
	Share capital	Share premium	Foreign exchange  reserve	Merger reserves	Accumulatedlosses	Total
	$000	$000	$000	$000	$000	$000
Balance at 1 April 2016 (Restated)	2,261	15,760	10,890	4,863	(18,895)	14,879
Loss for the year	-	-	-	-	(7,097)	(7,097)
Other comprehensive income
Movement in foreign exchange	-	-	(756)	-	(7)	(763)
Total comprehensive loss for the year	2,261	15,760	10,134	4,863	(25,999)	7,019
Transactions with owners
Share-based payment	-	-	-	-	69	69
Balance at 31 March 2017 (Restated)	2,261	15,760	10,134	4,863	(25,930)	7,088

 

 

 

 

Mirada plc

Consolidated statement of cash flows for the year ended 31 March 2018

 

	2018	2017
		(Restated)
	$000	$000
Cash flows from operating activities
Loss after tax	(4,870)	(7,097)
Adjustments for:
Depreciation of property, plant and equipment	73	46
Amortisation of intangible assets	3,352	2,718
Goodwill impairment charge	-	3,744
Share-based payment charge	72	69
Finance income	(84)	(3)
Finance expense	634	423
Taxation	(298)	103
Operating cash flows before movements in working capital	(1,121)	3
(Increase) / Decrease in trade and other receivables	(1,608)	2,251
Increase in trade and other payables	453	1,008
Taxation received	540	33
Net cash generated from operating activities	(1,736)	3,294
Cash flows from investing activities
Interest and similar income received	84	3
Purchases of property, plant and equipment	(161)	(59)
Purchases of other intangible assets	(3,780)	(3,438)
Net cash used in investing activities	(3,857)	(3,494)
Cash flows from financing activities
Interest and similar expenses paid	(634)	(423)
Loans received	3,020	2,691
Related parties loans received	6,588	-
Repayment of loans	(1,827)	(2,821)
Net cash from financing activities	7,147	(553)
Net increase in cash and cash equivalents	1,554	(753)
Cash and cash equivalents at the beginning of the period	277	1,025
Exchange losses on cash and cash equivalents	106	5
Cash and cash equivalents at the end of the year	1,937	277

 

 

 

 

 

Mirada plc

Notes to financial statements Year ended 31 March 2018

 

The following selected notes are extracted from the full Annual Report

 

1. General information

Mirada plc is a company incorporated in the United Kingdom. The address of the registered office is 68 Lombard Street, London, EC3V 9LJ. The nature of the Group's operations and its principal activities are the provision and support of products and services in the Digital TV and Broadcast markets.

In accordance with section 435 of the Companies Act 2006, the Directors advise that the financial information set out in this announcement does not constitute the Group's statutory financial statements for the year ended 31 March 2017 or 2018 but is derived from them. The financial statements for the year ended 31 March 2017 have been audited and filed with the Registrar of Companies. The financial statements for the year ended 31 March 2018 have been audited and will be filed with the Registrar of Companies following the Company's Annual General Meeting. The Independent Auditors Report on the Group's statutory financial statements for the years ended 31 March 2018 and 2017 were unqualified and did not contain statements under Section 498(2) or (3) of the Companies Act 2006. They did, however, draw attention to the material uncertainty related to Going Concern. The audit report for the year ended 31 March 2018 contains the following wording: 

 

We draw attention to note 2 to the financial statements concerning the parent company and group's ability to continue as a going concern. As discussed in note 2, the group's available working capital may prove insufficient to cover both operating activities and the repayment of its debt facilities and the directors are planning to raise additional funding that is subject to shareholder approval.

 

In order to obtain the necessary funding required, as announced in the Circular on September 17, 2018, the Company will be holding a General Meeting on October 4, 2018. In that General Meeting, it will be proposed to increase the ordinary share capital by £6.0 million, of which £3.0 million of the consideration will be received in cash. A further £3.0 million will be satisfied by discharging Mirada Plc from its liability to pay Kaptungs £3.0 million in accordance with the terms of a Facility Letter signed in March 2018, in consideration for the Company treating such discharged amount as payment in full for the subscription of 300,000,000 ordinary shares of 1p each in the capital of the Company at a subscription price of 1p per new ordinary share, each credited as fully paid up.

 

As set out in note 2, a significant shareholder has provided the Registrar of the Company with their Proxy voting in favour of both the resolutions for approval at the General Meeting. In addition, on 27 September, 2018, the directors received confirmation from Kaptungs that £3.0 million in cash will be transferred to Mirada Plc from Kaptungs, for the subscription of 300 million new Ordinary Shares at 1p per share to be issued, as referred to above, on approval of the resolutions at the General Meeting to be held on October 4, 2018.

 

As stated in note 2 of the financial statements, these matters indicate the existence of a material uncertainty which may cast significant doubt about the Company and Group's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the Company and Group were unable to continue as a going concern. Our opinion is not modified in respect of this matter.

 

The calculations supporting the going concern assessment require management to make highly subjective judgements. We have therefore spent significant audit effort in assessing the appropriateness of the assumptions involved, and as such this has been identified as a Key Audit Matter.

 

Our audit procedures included the following:

· Review of the group's cash flow forecast and other projections through to 31 March 2020, including assessing and challenging assumptions used and performing sensitivity analysis.

· Reviewing the terms of the group's proposed re-financing, specifically the 3 million proposed issue of share capital for cash, which as at the time of signing these accounts is subject to final shareholder approval at the General Meeting on October 4th, 2018.

· Reviewing the disclosures in the financial statements.

The financial information included in this announcement has been prepared in accordance with the recognition and measurement requirements of International Financial Repeating Standards as adopted for use in the EU but does not include all of the disclosures required by those standards. The accounting policies used in the preparation of the financial information are consistent with those used in the group's financial statements for the year ended 31 March 2018 and are unchanged from those set out in the financial statements for the period ended 31 March 2017, except as noted below:

In this period, the Board decided to change the reporting currency due to the growing exposure to the US Dollar, as all major contracts and most on the new potential deals for the Company are denominated in this currency. The board therefore believes that USD financial reporting provides more relevant presentation of the group's financial position, funding and treasury functions, financial performance and its cash flows. Coupled with the evolution of the business, the group's shareholder base is now largely comprised of foreign investors to whom financial reporting in GBP is of limited relevance. Internally, the board also bases its performance evaluation and many investment decisions on USD financial information.

2. Significant accounting policies

 

Basis of accounting

These Group financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations issued by the International Accounting Standards Board as adopted by European Union ("IFRSs") and with those parts of the Companies Act 2006 applicable to companies preparing their accounts under IFRSs.

 

Reporting currency

In this period, the Board decided to change the reporting currency due to the growing exposure to the US Dollar, as all major contracts and most on the new potential deals for the Company are denominated in this currency. The board therefore believes that USD financial reporting provides more relevant presentation of the group's financial position, funding and treasury functions, financial performance and its cash flows. Coupled with the evolution of the business, the group's shareholder base is now largely comprised of foreign investors to whom financial reporting in GBP is of limited relevance. Internally, the board also bases its performance evaluation and many investment decisions on USD financial information.

 

It should be noted that the functional currencies of the group's underlying businesses - functional currencies referring to the currencies of the primary economic environments in which underlying businesses operate - remain unchanged and that foreign exchange exposures will therefore be unaffected by the change, albeit that the effects of such exposures will be presented in USD.

 

To assist investors in understanding the change in accounting policy, restated statements of financial position have been presented, providing restated USD financial information for the financial years ended 31 March 2017 and 2016. The six-month interim periods ended 30 September 2017 and 2016 were also presented in USD and are available online, as announced on December 20th, 2017.

 

A change in reporting currency represents a change in an accounting policy in terms of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors requiring the restatement of comparative information. In accordance with IAS 21 The Effects of Changes in Foreign Exchange Rates, the following methodology was followed in restating historical financial information from GBP into USD:

 

· Non-USD assets and liabilities were translated at the relevant closing exchange rate at the end of the reporting period. Non-USD items of income and expenditure and cash flows were translated at average exchange rates for the reporting period disclosed;

· Share capital, premium and other reserves, as appropriate, were translated at the historic rates prevailing at the dates of underlying transactions; and

· The effects of translating the group's financial results and financial position into USD were recognised in the foreign currency translation reserve.

 

The Group has provided the average exchange rates of its major functional currencies relative to US dollar as an approximation for these rates for reference in the following table. The closing exchange rates of the group's major trading currencies relative to US dollar, used when translating the statements of financial position presented in this release into US dollar, are also detailed in this table

	31 March 2016		31 March 2017		31 March 2018
	Average rate	Closing rate	Average rate	Closing rate	Average rate	Closing rate
Sterling	-	1.4368	1.3071	1.2487	1.3268	1.4017
Euro	-	1.1357	1.0976	1.0683	1.1705	1.2360
Mexican peso	-	-	0.0521	0.0534	0.0541	0.0551

 

The cumulative foreign currency translation reserve was nil at the date of transition to IFRS. All subsequent movements comprising differences on the retranslation of the opening net assets of non-sterling subsidiaries have been taken to the foreign currency translation reserve. Share capital, share premium and other reserves were translated at the historic rates prevailing at the dates of transactions.

 

	As per Statement of Financial Position	GBP	Currency Translation effect	USD
31 March 2016	Total Assets	16,069	7,042	23,111
	Total Liabilities	(5,779)	(2,453)	(8,232)
	Share Capital	(1,391)	(870)	(2,261)
	Share Premium	(9,859)	(5,901)	(15,760)
	Other reserves	(3,033)	(12,720)	(15,753)
	Accumulated losses	3,993	14,902	18,895
31 March 2017	Total Assets	12,117	3,729	15,846
	Total Liabilities	(7,018)	(1,740)	(8,758)
	Share Capital	(1,391)	(870)	(2,261)
	Share Premium	(9,859)	(5,901)	(15,760)
	Other reserves	(3,303)	(11,694)	(14,997)
	Accumulated losses	9,454	16,476	25,930

 

 

 

The 2018 consolidation has been prepared in USD and not GBP as the decision to change reporting currencies was taken during the year. The currency translation effect has therefore not been disclosed. Share capital, share premium and other reserves were translated at the historic rates prevailing at the dates of transactions giving rise to those equity items. The transfer between reserves that arose on the capital reduction completed in on 12 January 2011 has been recognised at the average rate that was used to translate the shares cancelled.

Going concern

These financial statements have been prepared on the going concern basis. The Directors have reviewed the Company and Group's going concern position taking account of its current business activities, budgeted performance and the factors likely to affect its future development, which are set out in this Annual report, and include the Group's objectives, policies and processes for managing its capital, its financial risk management objectives and its exposure to credit and liquidity risks.

As at 31 March 2018, the Group had cash and cash equivalents of $1.94m (2017: $0.28m), net cash used in operating activities of $1.74m (2017: net cash generated of $3.29m), realised a loss for the year of $4.87m, (2017: a loss of $7.09m which included a one-off goodwill impairment of $3.74m), net current liabilities of $8.42m (2017: net current liabilities of $2.39m) and had net assets of $3.22m (2017: $7.09m).

The directors have prepared cash flow forecasts covering a period of at least 12 months from the date of approval of the financial statements. If the forecast is achieved, the Group will be able to operate within its existing facilities. However, the time to close new customers and the value of each customer, which are deemed high volume and low value in nature are factors which constrain the ability to accurately predict revenue performance. Furthermore, investment in winning customers, via marketing expenditure, and servicing and delivering to new customers remains an important function of the forecasts too. As such, there is a risk that the group's working capital may prove insufficient to cover both operating activities and the repayment of its debt facilities. In such circumstances, the group would be obliged to seek additional funding though a placement of shares or source other funding. The directors have had a history of raising financing from similar transactions.

On August 29th, 2018 the General Meeting approved the conversion into shares of the £1.7m loan facility announced on November 28th, 2017.

In order to obtain the necessary funding required, as announced in the Circular on September 17, 2018, the Company will be holding a General Meeting on October 4, 2018. In that General Meeting, it will be proposed to increase the ordinary share capital by £6.0 million, of which £3.0 million of the consideration will be received in cash. A further £3.0 million will be satisfied by discharging Mirada Plc from its liability to pay Kaptungs £3.0 million in accordance with the terms of a Facility Letter signed in March 2018, in consideration for the Company treating such discharged amount as payment in full for the subscription of 300,000,000 ordinary shares of 1p each in the capital of the Company at a subscription price of 1p per new ordinary share, each credited as fully paid up.

On September 14, 2018, Kaptungs signed an irrevocable voting undertaking referring the resolutions of the October 4, 2018, General Meeting.

On September 21, 2018, Kaptungs provided the Registrar of the Company with their Proxy voting in favour of both the resolutions for approval at the General Meeting. As per the Circular, Kaptungs has 60.82% of the voting rights of the Company.

On September 27, 2018, the directors received confirmation from Kaptungs that £3.0 million in cash will be transferred to Mirada Plc from Kaptungs on 28 September 2018, for the subscription of 300 million new Ordinary Shares at 1p per share to be issued, as referred to above, on approval of the resolutions at the General Meeting to be held on October 4, 2018. The money received was requested to be paid before the General Meeting on October 4, 2018, as it relates to the subscription of shares. The issue of ordinary shares and the discharging of the loan facility are conditional, inter alia, on the passing of the resolutions at the General Meeting and Admission becoming effective. Application will be made for the Subscription Shares and the Loan Capitalisation Shares to be admitted to trading on AIM, conditional on the resolutions being passed. It is expected that if the resolutions are passed, Admission will occur at 8.00 a.m. on 5 October 2018.

The directors remark that Kaptungs is a strong supporter of the Company after injecting $10m in cash between November 2017 and September 2018. However, the risk that both resolutions are not passed at the General Meeting on October 4, 2018, represents a material uncertainty, which may cast a doubt about the Company and Group's ability to continue as a going concern. Whilst recognising this uncertainty, on the basis of the Proxy votes received to date, and the strong support from Kaptungs, the directors believe that the resolutions will be passed at the General Meeting on October 4, 2018, and the company and group will be able to continue as a going concern. On this basis, these financial statements have been prepared on a going concern basis.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to 31 March 2018.

Where the company has control over an investee, it is classified as a subsidiary. The company controls an investee if all three of the following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of the investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control.

Revenue recognition

Interactive service revenues are divided into 4 types: development fees, the sale of licences, managed services and self-billing revenues.

Revenues from development fees (which include set-up fees): these are recognised according to management's estimation of the stage of completion of the project. This is measured by reference to the amount of development time spent on a project compared to the most up to date calculation of the total time estimated to complete the project in full.

Sale of license: Revenue from licenses are earned from two specific and separate streams.

1) Where the revenue relates to the sale of a one-off licence, the licence element of the sale is recognised as income when the following conditions have been satisfied:

· The software has been provided to the customer in a form that enables the customer to utilise it;

· The ongoing obligations of the Group to the customer are minimal; and

· The amount payable by the customer is determinable and there is a reasonable expectation of payment.

2) Contracts licence fees payable by customers are dependent upon the number of end user subscribers signing up to the customer's digital television service. For this type of contract revenues are recognised by multiplying the individual licence fee by the net increase in the customer's subscriber base.

Revenues from Software as a Service (SaaS) - The Group licenses software under licence agreements. Under this model, lower integration set up fees than in other agreements are offset by recurrent monthly licence fee revenues. License fee revenues are recognised on practical acceptance of the software, when all obligations have been substantially completed. This is when the customer has accepted the product ie. the risks and rewards of ownership have been transferred, it is probable that the economic benefits of the transaction will flow to the Group, all costs and revenue in relation to the transaction can reliably be measured. Additionally, after deployment, the Group provides support and maintenance services to the customer.

Managed services - revenue is measured on a straight-line basis over the length of the contract. Where agreements involve multiple elements, the entire fee from such arrangements is allocated to each of the individual elements based on each element's fair value. The revenue in respect of each element is recognised in accordance with the above policies.

Self-billing revenues: These are earned through a revenue-share agreement between Mirada and the customer which is presented in the Mobile segment. The Group are informed by the customer of the amount of revenue to invoice and the revenues are recognised in the period these services are provided

 

Certain revenues earned by the Group are invoiced in advance. As outlined in the revenue recognition policy above, revenues are recognised in the period in which the Group provides the services to the customer, revenues relating to services which have yet to be provided to the customer are deferred.

 

Business combinations

Acquisitions of businesses are accounted for using the purchase method. The cost of the acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued or to be issued, by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. The acquiree's identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3 are recognised at their fair value at the acquisition date.

Goodwill arising on acquisition is recognised as an asset and initially measured at cost and is accounted for according to the policy below.

Goodwill

Goodwill represents the excess of the cost of acquisition over the Group's interest in the fair value of the identifiable assets and liabilities of the acquired business at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses.

On disposal of a subsidiary the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

For the purpose of impairment testing, goodwill is allocated to each of the Group's cash-generating units expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

Other intangible assets

Intangible assets acquired as part of a business combination are initially recognised at their fair value and subsequently amortised on a straight line basis over their useful economic lives. Intangible assets that meet the recognition criteria of IAS 38, "Intangible Assets" are capitalised and carried at cost less amortisation and any impairment losses. Intangible assets comprise of completed technology, acquired software, capitalised development costs and goodwill.

 

Amortisation of other intangible assets is calculated over the following periods on a straight-line basis:

Completed technology	- over a useful life of 4 years
Deferred development costs	- over a useful life of 3 to 4 years

 

The amortisation is charged to administrative expenses in the consolidated income statement. Completed technology relates to software and other technology related intangible assets acquired by the Group from a third party. Deferred development costs are internally-generated intangible assets arising from work completed by the Group's product development team.

 

Internally-generated intangible assets - research and development expenditure

 

Any internally-generated intangible asset arising from the Group's development projects are recognised only if all of the following conditions are met:

· The technical feasibility of completing the intangible asset so that it will be available for use or sale.

· The intention to complete the intangible asset and use or sell it.

· The ability to use or sell the intangible asset.

· How the intangible asset will generate probable future economic benefits. Among other things, the Group can demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset.

· The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset.

· Its ability to measure reliably the expenditure attributable to the intangible asset during its development.

If a development project has been abandoned, then any unamortised balance is immediately written off to the income statement. Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the period in which it is incurred. The amortisation is charged to administrative expenses in the consolidated statement of comprehensive income.

Impairment of non-current assets excluding deferred tax assets

At each reporting date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised in the impairment of intangible assets line in the consolidated statement of comprehensive income as an expense immediately.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior periods. A reversal of an impairment loss is recognised as income immediately.

Goodwill impairments are not reversed.

Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and any impairment in value.

Depreciation is provided on all property, plant and equipment, other than freehold land, at rates calculated to write off the cost, less estimated residual value based on current prices, of each asset evenly over its expected useful life, as follows:

 

- Office & computer equipment	33.3% per annum
- Short-leasehold improvements	10% per annum

 

The carrying values of property, plant and equipment are reviewed for impairment if events or changes in circumstances indicate the carrying value may not be recoverable. The asset's residual values, useful lives and methods are reviewed, and adjusted if appropriate, at each financial period end.

Financial instruments

Financial assets and financial liabilities are recognised on the Group's statement of financial position at fair value when the Group becomes a party to the contractual provisions of the instrument.

Trade receivables

Trade receivables represent amounts due from customers in the normal course of business. All amounts are initially stated at their fair value and are subsequently carried at amortised cost, less provision for impairment which is calculated on an individual customer basis, where there is objective evidence.

Cash and cash equivalents

Cash and cash equivalents include cash at hand and deposits held at call with banks with original maturities of three months or less.

Financial liabilities and equity instruments

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.

Financial instruments issued by the Group are treated as equity only to the extent that they do not meet the definition of a financial liability. The Group's ordinary shares are classified as equity. When new shares are issued, they are recorded in share capital at their par value. The excess of the issue price over the par value is recorded in the share premium reserve.

Incremental external costs directly attributable to the issue of new shares (other than in connection with a business combination) are recorded in equity as a deduction, net of tax, to the share premium reserve.

Bank Borrowings

Interest-bearing bank loans are initially recorded at fair value less direct issue costs. Finance charges are accounted for on an accruals basis in the income statement using the effective interest rate method and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise.

Trade payables

Trade payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method.

Employee share incentive plans

The Group issues equity-settled share-based payments to certain employees (including directors). These payments are measured at fair value at the date of grant by use of the Black-Scholes pricing model. This fair value cost of equity-settled awards is recognised on a straight-line basis over the vesting period, based on the Group's estimate of shares that will eventually vest and adjusted for the effect of any non-market based vesting conditions. The expected life used in the model has been adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations. A corresponding credit is recorded in equity in the retained earnings.

Leases

Leases taken by the Group are assessed individually as to whether they are finance leases or operating leases. Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Operating lease rental payments are recognised as an expense in the statement of comprehensive income on a straight-line basis over the lease term. The benefit of lease incentives is spread over the term of the lease.

Taxation

The tax expense represents the sum of the current tax and deferred tax charges.

The tax currently payable is based on taxable profit for the period. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled, or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

 

 

Research and development tax credit

Companies within the group may be entitled to claim special tax allowances in relation to qualifying research and development expenditure (e.g. R&D tax credits). The group accounts for such allowances as tax credits, which means that they are recognised when it is probable that the benefit will flow to the group and that benefit can be reliably measured. R&D tax credits reduce current tax expense and, to the extent the amounts due in respect of them are not settled by the balance sheet date, reduce current tax payable. A deferred tax asset is recognised for unclaimed tax credits that are carried forward as deferred tax assets. They are recognised to the extent that it is expected to be recoverable against future taxable profits.

Retirement benefit costs

The Group operates defined contribution pension schemes. The amount charged to the statement of comprehensive income in respect of pension costs and other post-retirement benefits is the contributions payable in the period. 

Differences between contributions payable in the period and contributions actually paid are shown as either accruals or prepayments in the statement of financial position.

Foreign exchange

The individual financial statements of each group company are presented in the currency of the primary economic environment in which it operates (its functional currency). For the purpose of the consolidated financial statements, the result and the financial position of each group company are expressed in US Dollars, which the presentational currency for the consolidated financial statements.

On translation of balances into the functional currency of the entity in which they are held, exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included in profit or loss for the period.

For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group's foreign operations are translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the date of transactions are used. 

Exchange differences arising on translating the opening statement of financial position and the current year income statements are classified as equity and transferred to the Group's foreign exchange reserve. Such translation differences are recognised as income or as expenses in the period in which the operations are disposed of.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. The Group has elected to treat goodwill and fair value adjustments arising on acquisitions before the date of transition to IFRS as sterling denominated assets and liabilities.

3. Critical accounting judgements and key sources of estimation uncertainty

Critical judgements in applying the Group's accounting policies

In the application of the Group's accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis.

Key sources of estimation uncertainty and judgements

The following are the critical judgements that the directors have made in the process of applying the Group's accounting policies that has the most significant effect on the amounts recognised in the financial statements.

Presenting financial information in USD

In this period, the Board decided to change the reporting currency due to the growing exposure to the US Dollar, as all major contracts and most on the new potential deals for the Company are denominated in this currency. The board therefore believes that USD financial reporting provides more relevant presentation of the group's financial position, funding and treasury functions, financial performance and its cash flows. Coupled with the evolution of the business, the group's shareholder base is now largely comprised of foreign investors to whom financial reporting in GBP is of limited relevance. Internally, the board also bases its performance evaluation and many investment decisions on USD financial information.

Impairment of goodwill and intangibles

Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires the Group to estimate the future cash flows expected to arise from the cash-generating units and the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the cash-generating unit. This includes the directors' best estimate on the likelihood of current deals in negotiation not yet concluded. Consequently, the outcome of negotiations may vary materially from management expectation. 

See note 12 for details of key assumptions and an assessment of reasonable changes in key assumptions used in the impairment test.

 

 

Capitalised development costs

Any internally generated intangible asset arising from the Group's development projects are recognised only once all the conditions set out in the accounting policy Internally Generated Intangible Assets (refer to note 2) are met. The amortisation period of capitalised development costs is determined by reference to the expected flow of revenues from the product based on historical experience. Furthermore, the Group reviews, at the end of each financial year, the capitalised development costs for each product for indications of any loss of value compared to net book value at that time. This review is based on expected future contribution less the total expected costs.

The Group capitalises spend on development new software and the delivery of innovative software. Management exercises judgement in establishing both the technical feasibility of completing an intangible asset which can be sold, and the degree of certainty that a market exists for the asset, or its output, based on feedback from existing and potential customers, for the generation of future economic benefits. In addition, amortisation rates are based on estimates of the useful economic lives and residual values of the assets involved.

4. Segmental reporting

Reportable segments

The chief operating decision maker for the Group is ultimately the board of directors. For financial and operational management, the board considers the Group to be organised into two operating divisions based upon the varying products and services provided by the Group - Digital TV & Broadcast and Mobile. The products and services provided by each of these divisions are described in the Strategic Report. The segment headed other relates to corporate overheads, assets and liabilities.

Segmental results for the year ended 31 March 2018 are as follows:

	Digital TV & Broadcast		Mobile		Other		Group
	$000		$000		$000		$000
Revenue	7,938		878		-		8,816
Segmental profit/(loss)	(102)		209		(1,228)		(1,121)
(Adjusted EBITDA, see note 6)
Finance income	-		-		84		84
Finance expense	-		-		(634)		(634)
Depreciation	(63)		(10)		-		(73)
Amortisation	(3,352)		-		-		(3,352)
Share-based payment charge	-		-		(72)		(72)
Profit / (Loss) before taxation	(3,517)		199		(1,850)		(5,168)

 

$1.228 million (2017: $1.16 million) disclosed as "Other" comprises employment, legal, accounting and other central administrative costs incurred at a Mirada Plc level.

 

 

 

The segmental results for the year ended 31 March 2017 are as follows:

March 2017
	Digital TV & Broadcast		Mobile		Other		Group
	$000		$000		$000		$000
Revenue -	7,755		734		-		8,489
Segmental profit/(loss)	957		162		(1,160)		(41)
(Adjusted EBITDA, see note 6)
Finance income	-		-		3		3
Finance expense	-		-		(423)		(423)
Depreciation	(44)		(2)		-		(46)
Amortisation	(2,715)		(3)		-		(2,718)
Goodwill impairment charge	(3,744)		-		-		(3,744)
Share-based payment charge	-		-		(69)		(69)
Irrecoverable sales tax expense	44		-		-		44
Profit / (Loss) before taxation	(5,502)		157		(1,649)		(6,994)

 

There is no material inter-segment revenue.

The Group has a major customer in the Digital TV and Broadcast segment that generates revenues amounting to 10% or more of total revenue that account for $5.2 million of $8.8m total revenue. This is approximately 61% of all revenue (2017: $6.0 million, out of $8.5m) of the total Group revenues.

The segment assets and liabilities at 31 March 2018 are as follows:

Assets 31.03.18
			Digital TV		Mobile		Other		Group
			$000		$000		$000		$000
Additions to non-current assets			3,941		-		-		3,941
Total assets			13,612		194		6,734		20,540
Total liabilities			(9,590)		(74)		(7,656)		(17,320)

 

Capital expenditure comprises additions to property, plant and equipment and intangible assets.

 

 

 

 

 

 

The segment assets and liabilities at 31 March 2017 are as follows:

		Assets 2018		Liabilities 2018		Assets 2017		Liabilities 2017
		$000		$000		$000		$000
Digital TV - Broadcast & Mobile		13,807		9,664		10,151		8,118
Other:
Goodwill		6,492		-		5,643		-
Other financial assets & liabilities		241		7,656		52		640
Total other		6,733		7,656		5,695		640
Total Group assets and liabilities		20,540		17,320		15,846		8,758

Segment assets and liabilities are reconciled to the Group's assets and liabilities as follows:

Assets allocated to a segment consist primarily of operating assets such as property, plant and equipment, intangible assets, goodwill and receivables.

Liabilities allocated to a segment comprise primarily trade payables and other operating liabilities. 

Geographical disclosures
		External revenue by location of customer			Total assets by
					location of assets
		2018		2017		2018		2017
		$000	$000		$000			$000
Mexico		5,466		6,630		6		17
Europe		2,010		1,859		20,534		15,829
Other Americas		1,267		-		-		-
Asia		73		-		-		-
		8,816		8,489		20,540		15,846
Revenues by Products:
		Digital TV & Broadcast 2018		Mobile 2018		Digital TV & Broadcast 2017		Mobile 2017
		$000	$000		$000			$000
Development		4,363		-		5,541		-
Transactions		-		878		-		734
Licenses		2,581		-		1,114		-
Managed Services		994		-		1,100		-
		7,938		878		7,755		734

 

5. Operating loss

This has been arrived at after charging:

	2018	2017
	$000	$000
Depreciation of owned assets (note 13)	73	46
Amortisation of intangible assets (note 12)	3,352	2,718
Goodwill impairment charge (note 12)	-	3,744
Operating lease charges	473	411

 

Analysis of auditors' remuneration is as follows:

	2018	2017
	$000	$000
Fees payable to the company's auditor for the audit of the company's annual accounts	87	74
Audit of the account of subsidiaries	34	17

 

Reconciliation of operating profit for continuing operations to adjusted earnings before interest, taxation, depreciation and amortisation:

	2018	2017
	$000	$000
Operating loss	(4,618)	(6,574)
Depreciation	73	46
Amortisation	3,352	2,718
Goodwill impairment charge (note 12)	-	3,744
Operating profit/loss before interest, taxation, depreciation, amortisation, impairment (EBITDA)	(1,193)	(66)
Share-based payment charge	72	69
Irrecoverable sales tax income	-	(44)
Adjusted EBITDA	(1,121)	(41)

 

6. Taxation

The tax assessed on the loss on ordinary activities for the period differs from the standard rate of tax of 19% (2017-20%). The differences are reconciled below:

 

 

 

 

 

 

	2018		2017
	$000		$000
Loss before taxation	(5,168)		(6,994)
Loss on ordinary activities multiplied by 19% (2017: 20%)	(982)		(1,399)
Losses carried forward	982		1,399
Withholding Taxes	125		135
Total current tax	125		135
Decrease of deferred tax assets	39		495
Subtotal	164		630
R&D	(497)		(491)
Foreign exchange	35		(36)
Total tax (credit)/expense	(298)		103

 

Deferred Taxation

Deferred tax assets related to tax losses were reduced by $495,000 during FY17 in Mirada Iberia S.A. Foreign exchange differences of $44,000 arising on consolidation of the deferred tax asset were recognised in other comprehensive income.

Deferred tax assets related to tax losses were reduced by $30,000 during FY18 in Mirada Connect. Foreign exchange differences of $8,000 arising on consolidation of the deferred tax asset were recognised in other comprehensive income.

 

Reconciliation of deferred tax asset and liabilities:

Reconciliation of deferred tax asset and liabilities
	2018		2017
	Asset		Asset
	$000		$000
Balance at 1 April	30		569
Reversal of Deferred tax asset	(39)		(495)
Foreign exchange	9		(44)
Balance at the end of year	-		30

 

 

 

 

 

 

 

Deferred taxation amounts not recognised are as follows:

Group	Group		Group		Company		Company
	2018		2017		2018		2017
	$000		$000		$000		$000
Losses	16,272		15,290		23,870		22,459
Research & Development Tax Credits,	3,082		2,739		-		-
useable against future profits
Balance at the end of the year	19,354		18,029		23,870		22,459

 

The gross value of tax losses carried forward at 31 March 2018 equals $78.0 million (2017: $70.0 million).

The deferred tax asset for the company has not been recognised on the grounds that there is insufficient evidence at the balance sheet date that it will be recoverable. The asset would start to become potentially recoverable if, and to the extent that, the company were to generate taxable income in the future.

 

7. Earnings per share

		Year ended 31 March 2018			Year ended 31 March 2017
		Total			Total
Loss for year		$(4,870,019)			$(7,096,551)
Weighted average number of shares		139,057,695			139,057,695
Basic loss per share		$(0.035)			$(0.051)
Diluted loss per share		$(0.035)			$(0.051)

 

The Company has 4,697,166 (2017: 4,697,166) potentially dilutive ordinary shares arising from share options issued to staff. However, in 2018 and 2017 the loss attributable to ordinary shareholders and weighted average number of ordinary shares for the purpose of calculating the diluted earnings per ordinary share are identical to those used for basic earnings per ordinary share. This is because the exercise of share options would have the effect of reducing the loss per ordinary share and is therefore anti-dilutive.

 

8. Share capital

A breakdown of the authorised and issued share capital in place as at 31 March 2018 is as follows:

 

	2018 Number	2018 $000	2017 Number	2017 $000
Allotted, called up and fully paid
Ordinary shared of £0.01	139,057,695	2,261	139,057,695	2,261

 

9. Events after the reporting date

Refer to note 2 of the financial statements for detail on events after the reporting date.

 

END