1 Nov 2012 07:00
1 November 2012 mirada plc (AIM: MIRA) ("mirada" or "the Group") Interim results for the six months to 30 September 2012
mirada plc, the AIM quoted leading audiovisual content interaction specialist, announces its unaudited interim results for the six months to 30 September 2012.
Key Points
* Revenue for the period is £2.46 million, compared to £2.28 million for the
six months ended 30 September 2011 * Gross profit increased to £2.35 million from £2.01 million in the six months ended 30 September 2011 * Profit before interest, tax, depreciation and amortisation was £0.61 million, compared to a £0.23 million loss for the six months ended 30 September 2011
* Earnings per share equalled 0.1p compared to a loss per share of 4.4p for
the six months ended 30 September 2011
Operational Highlights
* mirada has reached profitability for the first time in its history * Successful transition from a professional services based company to a product based model * Significant investment made in iris, a "TV everywhere", multi-screen product mainly addressed to the cable television market, and navi, a content navigation tool for the IPTV market * Several major customers have led to the generation of substantial, recurrent licence fee revenue * GVT has gained more than 200,000 new subscribers and it has become the fastest growing Digital TV operator in the Brazilian market * Additionally, mirada and Ericsson are participating in a number of new
negotiations, mostly in Latin America and Eastern Europe, which it is hoped
will lead to further new contracts in the present fiscal year
* First iris customer, Cablecom, launched its HD (High Definition) service in
July
Jos© Luis V¡zquez, Chief Executive Officer of mirada, said:
"The first six months of this financial year has seen the start of the returnon the investment made in our product development strategy. The recurrentrevenues generated from licence fees based on the growth of our customers,especially in the Latin American market, have helped the Group to make thetransition to profitability. The Group has been able to make this transition inthe current adverse economic environment through a strong belief in thebenefits of the new business model and thanks to the expansion into growing
international markets." --END-- Enquiries:mirada plc +44 (0) 207 549 5678
Jose Luis Vazquez, Chief Executive Officer
Bishopsgate Communications +44 (0) 207 562 3350 Nick Rome/Sam Allen/ Matt Low
mirada@bishopsgatecommunications.com
Seymour Pierce Limited (Nominated Advisor & Broker) +44 (0) 207 107 8000 Mark Percy (Corporate Finance)
David Banks (Corporate Broking) Peterhouse Corporate Finance (Joint Broker) +44 (0) 207 469
0937 Jon Levinson
Chief Executive Officer's Statement
Overview
I am pleased to present the Group's financial results for the six months to 30September 2012. This period has seen the benefits of the transition from aprofessional services based company to a product based model. The investmentmade in our most important products, iris and navi, has been rewarded withdeployment of new Digital TV services by several major customers leading to thegeneration of substantial, recurrent licence fee revenue. These licence feeshave helped to enable the Group to record a profit for the period.This improved performance was made possible thanks to the incredible supportfrom our employees, customers and major shareholders. Their continued beliefthat mirada has an important role to play in the Digital TV market, and that aproduct-led strategy could generate value in this rapidly changing market havebeen the cornerstones which have led to the creation of a successful businessmodel from which the Group is now benefiting.It has been a long process, during which we have needed to close someloss-making business areas to enable us to concentrate on the core skills ofour team. We are now proud to announce that the process is complete and thatthe Group has reached profitability. In order to improve performance further wehave set ourselves the targets of extending our international reach into newmarkets and of continuing to improve our product proposition to allow us tokeep ahead of the expectations of the Digital TV market.
Review of operations
During the period mirada has focused on the expansion of its main area ofbusiness, Digital TV, through the deployment of its navi and iris products.Major new contracts in this area are on a product-based model that comprisesset-up fees, plus licence fees based on the number of subscribers signing up toour customers' digital television services.
navi is a content navigation tool which allows the end user of a Digital TV platform to optimise their experience whilst using the service. mirada deploys navi via its global partnership agreement with Ericsson who are the world's leading IPTV infrastructure supplier to telecommunication companies.
mirada's first major customer through its partnership with Ericsson was GVT, aBrazilian telecommunications company who are part of the Vivendi group, wholaunched their IPTV service in November 2011. During the 6 months ended 30September 2012 GVT has gained more than 200,000 new subscribers and it hasbecome the fastest growing Digital TV operator in the Brazilian market. Inaddition to the licence fees earned in relation to these new subscribers miradaearns recurrent annual support and maintenance fees. GVT is also continuing todeploy new functionalities developed by mirada from which the Group earnsadditional professional service fee income.During the period under review, mirada has being working hard on deploying asecond Digital TV platform with navi, and we expect to announce its commerciallaunch very shortly. This customer is based in Mexico, reinforcing our presencein the region. Additionally, mirada and Ericsson are participating in a numberof new negotiations, mostly in Latin America and Eastern Europe, which we hopewill lead to further new contracts in the present fiscal year.iris is our "TV everywhere" multi-screen product mainly addressed to the cabletelevision market. Our first iris customer, Cablecom, launched its HD (HighDefinition) service in July this year, and has started signing up newsubscribers which has led to additional licence fees being earned by mirada.The iris product has been received very well by the market and mirada iscurrently in negotiations to sell the technology to other customers, mainly inLatin America, and we expect to announce an important new customer by the endof 2012.The Digital TV revenues of the Group during the period have grown by 32% to £2.12 million when compared to revenues of £1.61 million in the 6 months ended30 September 2011. Of these revenues, 90% were generated overseas (outside ofUK and Spain), growing to £1.91 million from £1.31 million in the same periodlast year. The Digital TV earnings before interest, taxation, depreciation andamortisation improved to £0.96 million from £0.46 million.
Other activities
Revenues earned by the Broadcast division were £0.12 million for periodcompared to £0.43 million for 6 months ended 30 September 2011, of thisreduction £0.24 million relates to the fact that the Group's return pathactivities ceased at the end of June 2011. The remaining reduction was due tomirada's technical team focusing their efforts on the Digital TV deploymentsmade during the period. We expect the revenues for the Broadcast division toincrease significantly in the second half of the year with new projectsanticipated to be contracted through mirada's partnership with Red Bee Media.There is a continued growth of the revenues in mirada connect, our cashlessparking payment solution, through new deployments from our partnerships withApcoa and Vinci in the UK. Mirada now manages the cashless parking services forthe First Great Western and First Capital Connect train lines, as well asparking for the Travelodge hotel chain. The business unit is increasinglyindependent from the Group with an independent management team and services nowbeing deployed from the cloud, which has dramatically increased theflexibility, time to market and resilience of our managed services. We expectthe unit to consolidate its growth and to expand its activities to on-streetcashless parking services during the following months.
Financial overview
Group revenue for the period equalled £2.46 million, compared to £2.28 millionfor the six months ended 30 September 2011, with gross profit increasing to £2.35 million from £2.01 million. The reasons for the growth are related to ourinternational expansion and to the increase in the revenues generated fromlicence fees, which represent a 33% of our total revenues during the period(14% during the same period last year).The closure of the loss making businesses and the restructuring which has takenplace over the last year has led to a decrease in other administrative expensesfrom £2.24 million in the 6 months ended 30 September 2011 to £1.74 million inthe current period.The effect of the above has led to a dramatic improvement in earnings beforeinterest, tax, depreciation and amortisation, which totalled £0.61 million inthe current period compared to a loss of £0.23 million in the 6 months ended 30September 2011. This improvement has continued to the bottom line with theGroup earning a retained profit for the period of £0.02 million compared to aloss of £0.93 million in the 6 months ended 30 September 2011.
Outlook
The first six months of this financial year has seen the start of the return onthe investment made in our product development strategy. The recurrent revenuesgenerated from licence fees based on the growth of our customers, especially inthe Latin American market, have helped the Group to make the transition toprofitability. The Group has been able to make this transition in the currentadverse economic environment through a strong belief in the benefits of the newbusiness model and thanks to the expansion into growing international markets.We continue to invest in our core Digital TV products to provide the marketwith the best solutions for the transition to a multi-screen world, and we arevery satisfied with the progress that we are making in this field. We believethat, with our experience in the audio-visual interaction market, we will beable to continue surpassing the expectations of our customers and partners. Ourtwo major products, navi and iris, have been very well received in the DigitalTV market, and we expect to achieve further growth through the continueddevelopment of new functionalities and through an increased access to growingmarkets.The transition is complete, and we are now seeing the benefits of the productbased model. We expect to continue to improve our performance and we lookforward to providing the market with continued news flow of our achievementsduring the following months.Jose Luis VazquezChief Executive Officer1 November 2012
Consolidated income statement for the six months to 30 September 2012
Note 6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000 Revenue 3 2,457 2,282 4,346 Cost of sales (109) (273) (562) Gross profit 2,348 2,009 3,784 Depreciation (33) (58) (106) Amortisation of deferred (317) (363) (733)development costs Impairment of goodwill - - (560) Restructuring costs - (71) (528) Other administrative expenses (1,743) (2,238) (4,156) Total administrative costs (2,093) (2,730) (6,083) Operating profit/(loss) 4 255 (721) (2,299) Finance income 3 - 4 Finance expense (233) (211) (867) Profit/(loss) before taxation 25 (932) (3,162) Taxation - - - Profit/(loss) for period 25 (932) (3,162) Earnings/(loss) per share - basic 5 0.1p (4.4p) (11.0p)
The above amounts are attributable to the equity holders of the parent.
Consolidated statement of comprehensive income
Six months to 30 September 2012
6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000 Profit/(loss) for the financial period 25 (932)
(3,162)
Currency translation differences 90 (61)
(306)
Total comprehensive income/(expense) 115 (993) (3,468)for the period
Consolidated statement of changes in equity
Six months to 30 September 2012
Profit Share Foreign and Share Share option exchange Merger loss capital premium reserve reserve reserve account Total £000 £000 £000 £000 £000 £000 £000 At 1 April 2012 319 1,216 140 537 2,472 (3,026) 1,658 Profit for the financial - - - - - 25 25period Movement in foreign - - - 90 - - 90exchange reserve At 30 September 2012 319 1,216 140 627 2,472 (3,001) 1,773 Profit Share Foreign and Share Share option exchange Merger loss capital premium reserve reserve reserve account Total £000 £000 £000 £000 £000 £000 £000 At 1 April 2011 213 273 2,109 843 2,472 (1,833) 4,077
Loss for the financial - - - - - (932) (932)period Movement in foreign - - - (61) - - (61)exchange reserve At 30 September 2011 213 273 2,109 782 2,472 (2,765) 3,084 Profit Share Foreign and Share Share option exchange Merger loss capital premium reserve reserve reserve account Total £000 £000 £000 £000 £000 £000 £000 At 1 April 2011 213 273 2,109 843 2,472 (1,833) 4,077 Loss for the financial - - - - - (3,162) (3,162)period Transfer between - - (1,969) - - 1,969 -reserves Issue of shares 106 960 - - - - 1,066 Share issue costs - (17) - - - - (17) Movement in foreign - - - (306) - - (306)exchange reserve At 31 March 2012 319 1,216 140 537 2,472 (3,026) 1,658
Consolidated statement of financial position as at 30 September 2012
30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000 Property, plant and equipment 79 156 112 Goodwill 6,946 7,506 6,946 Intangible assets 1,442 1,377 1,295 Non-current assets 8,467 9,039 8,353 Trade and other receivables 1,615 926 1,324 Cash and cash equivalents 3 28 35 Current assets 1,618 954 1,359 Total assets 10,085 9,993 9,712 Loans and borrowings (674) (818) (1,095) Trade and other payables (3,447) (2,417) (3,088) Current liabilities (4,121) (3,235) (4,183) Net current liabilities (2,503) (2,281) (2,824) Total assets less current 5,964 6,758 5,529liabilities Interest bearing loans and (3,058) (3,095) (2,817)borrowings Embedded conversion option (292) (292) (292)derivative Other non-current liabilities (185) - (194) Provisions (656) (287) (568) Non-current liabilities (4,191) (3,674) (3,871) Net assets 1,773 3,084 1,658
Issued share capital and reserves attributable to equity holders of
the company Share capital 319 213 319 Share premium 1,216 273 1,216 Other reserves 3,239 5,363 3,149 Accumulated losses (3,001) (2,765) (3,026) Equity 1,773 3,084 1,658
Consolidated statement of cash flows six months to 30 September 2012
6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000
Cash flows from operating activities
Profit/(loss) for the period 25 (932) (3,162) Adjustments for:
Depreciation of property, plant and 33 58
106equipment
Amortisation of intangible assets 317 363
733 Impairment of goodwill - - 560 Finance income (3) - (4) Finance expense 233 211 867 Operating cash flows before movements 605 (300) (900)in working capital (Increase)/decrease in trade and other (340) 594 152receivables
Increase/(decrease) in trade and other 587 (536)
(56)payables
(Decrease)/increase in provisions (113) -
216
Cash generated from/(used in) 739 (242) (588)operations Interest and similar expenses paid (126) (110)
(307)
Net cash generated from/(used in) 613 (352) (895)operating activities
Cash flows from investing activities Interest and similar income received 3 -
4
Purchases of property, plant and (2) (35)
(41)equipment Purchases of other intangible assets (514) (512)
(828)
Net cash used in investing activities (513) (547)
(865)
Cash flows from financing activities
Issue of share capital - - 843 Costs of share issue - - (17) Loans received 604 935 1,246 Repayment of loans (570) (50) (239)
Repayment of capital element of finance (5) (16)
(27)leases Net cash generated from financing 29 869 1,806activities
Net increase/(decrease) in cash and 129 (30)
46cash equivalents Cash and cash equivalents at the (299) (366) (366)beginning of the period
Exchange gains on cash and cash 13 4
21equivalents
Cash and cash equivalents at the end of (157) (392) (299) the period
Cash and cash equivalents comprise cash at bank less bank overdrafts.
Notes to the Accounts1. Basis of PreparationThis interim report was approved by the Directors on 31 October 2012. Thecondensed interim financial statements comprise the unaudited results for thesix months to 30 September 2012 and 30 September 2011 and the audited resultsfor the year ended 31 March 2012. The financial information for the year ended31 March 2012 does not constitute the full statutory accounts for the period.The Annual Report and Financial Statements for the year ended 31 March 2012have been filed with the Registrar of Companies. The Independent Auditors'Report on the Annual Report and Financial Statements for the year ended 31March 2012 was unqualified, but did include a reference to the uncertaintiessurrounding going concern, to which the auditors drew attention by way ofemphasis and did not contain a statement under 498(2) - (3) of the CompaniesAct 2006.The information included in these condensed interim financial statements forthe six months ending 30 September 2012 does not include all the informationand disclosures made in the annual financial statements. The condensed interimfinancial statements have been prepared in a manner consistent with theaccounting policies set out in the group financial statements for the yearended 31 March 2012 and on the basis of the International Financial ReportingStandards (IFRS) as adopted for use in the EU that the Group expects to beapplicable as at 31 March 2013. IFRS are subject to amendment andinterpretation by the International Accounting Standards Board (IASB) and thereis an ongoing process of review and endorsement by the European Commission. TheGroup has not adopted IAS 34: "Interim Financial Reporting" as the AIM Rulesfor Companies and related regulations do not require half-yearly financialreports to be prepared in accordance with IAS 34.
The condensed interim financial information for the six months ended 30 September 2012 and 30 September 2011 has neither been audited nor reviewed pursuant to guidance issued by the Auditing Practices Board.
2. Accounting policies
The accounting policies adopted are consistent with those set out in the financial statements for the year ended 31 March 2012 and that are expected to apply for the year ended 31 March 2013.
3. Segmental reporting
For management purposes the Group is currently organised into three operatingdivisions based upon the varying products and services provided by the Group -Gaming, Digital TV, Broadcast and Mobile (which includes Interactive Marketingand Mirada Connect). The segment headed other relates to corporate overheads,assets and liabilities.Segmental results for the 6 months ended 30 September 2012 are as follows:
Digital Broadcast Mobile Other Group TV £000 £000 £000 £000 £000 Revenue - external 2,119 120 218 - 2,457 Gross profit 2,116 106 126 - 2,348 Profit/(loss) before 958 84 13 (450) 605interest, tax, depreciation & amortisation Depreciation (19) - - (14) (33) Amortisation (282) - (19) (16) (317) Finance income - - - 3 3 Finance expense - - - (233) (233) Segmental profit/(loss) 657 84 (6) (710) 25
Segmental results for the 6 months ended 30 September 2011 are as follows:
Digital Broadcast Mobile Other Group TV £000 £000 £000 £000 £000 Revenue - external 1,609 429 244 - 2,282 Gross profit 1,592 280 137 - 2,009 Profit/(loss) before 463 197 (4) (885) (229)interest, tax, depreciation & amortisation Depreciation (27) - - (31) (58) Amortisation (350) - - (13) (363) Restructuring costs - - - (71) (71) Finance income - - - - - Finance expense - - - (211) (211) Segmental profit/(loss) 86 197 (4) (1,211) (932)
Segmental results for the year ended 31 March 2012 are as follows:
Digital Broadcast Mobile Other Group TV £000 £000 £000 £000 £000 Revenue - external 3,346 594 406 - 4,346 Gross profit 3,165 420 199 - 3,784 Profit/(loss) before 792 323 (61) (1,426) (372)interest, tax, depreciation & amortisation Impairment of goodwill - - (560) - (560) Depreciation (53) - - (53) (106) Amortisation (707) - (18) (8) (733) Restructuring costs - - - (528) (528) Finance income - - - 4 4 Finance expense - - - (867) (867) Segmental profit/(loss) 32 323 (639) (2,878) (3,162)Geographical disclosures
Revenue by location of customer
6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000 UK 338 602 908 Spain 210 370 615 Continental Europe 288 630 1,319 Americas 1,621 680 1,504 Total 2,457 2,282 4,3464. Operating profit/(loss)
Reconciliation of operating profit/(loss) to profit/(loss) before interest, taxation, depreciation and amortisation:
6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) £000 £000 £000 Operating profit/(loss) 255 (721) (2,299) Depreciation 33 58 106
Amortisation of deferred development 317 363
733costs Impairment of goodwill - - 560 Restructuring costs - 71 528 Profit/(loss) before interest, 605 (229) (372)taxation, depreciation and amortisation 5. Earnings/(loss) per share 6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited) Profit/(loss) for period £25,000 (£932,000) (£3,192,000)
Weighted average number of shares 31,973,423 21,305,485 29,050,700
Basic earnings/(loss) per share 0.1p (4.4p)
(11.0p)
Adjusted earnings/(loss) per share
Adjusted earnings/(loss) per share is calculated by reference to the loss fromcontinuing activities before interest, taxation, amortisation and depreciation(see note 4). 6 months 6 months Year ended ended ended 30 September 30 September 31 March 2012 2011 2012 (Unaudited) (Unaudited) (Audited)
Adjusted profit/(loss) for period £605,000 (£229,000) (£372,000)
Weighted average number of shares 31,973,423 21,305,485 29,050,700
Basic & diluted earnings/(loss) per 1.9p (1.1p) (1.3p)share 6. Related party transactions
Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note. There were no material transactions between the Group and the related parties during the period.
7. Other
Copies of unaudited interim results have not been sent to shareholders, however copies are available on request from the Company Secretary at the Company's registered office, New City Cloisters, 196 Old Street, London, EC1V 9FR.
XLON