Motive Television Plc Regulatory News (MTV)

Motive Television PLC

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

Half-yearly results for the six months ended 30 June 2011

Motive Television PLC (AIM: MTV.LN), the digital television technology, software and services provider, is pleased to announce its interim results for the six months ended 30 June 2011. 

Financial highlights

·; Revenue from continuing operations up 195 per cent to £1,094,563 (H1 2010: £370,818)

·; Gross profit from continuing operations up 347 per cent to £390,680 (H1 2010: £87,421)

·; Loss attributable to continuing activities £1,704,950 (H1 2010: £535,894)

·; Loss per share from continuing activities 0.12p (H1 2010: 0.10p)

Operational highlights

·; Launch of Television Anytime Anywhere platform which integrates the Company's two core software brands

·; US subsidiary established to address growing business in the United States

·; Memorandum of Understanding signed with CME Media Services Ltd., a wholly-owned subsidiary of Central European Media Enterprises Ltd

·; Agreement for pilot programme with Granite Broadcasting Corporation in the United States

·; Agreement with Media Networks Latin America S.A.C. for Television Anytime Anywhere project in Latin America

·; Successfully enabled the broadcasting of 3D television content to a set-top box

·; Board strengthened with the appointment of Graham Loader as Chief Financial Officer, Group Finance Director and Company Secretary

Commenting on the results, Michael Pilsworth, Executive Chairman, said: 

"The Group has made good progress in the first six month period of the current financial year, having successfully launched Television Anytime Anywhere and signed new agreements in the United States, South America and Europe. We remain in discussions with a number of broadcasters, cable, and satellite operators in both Europe and the Americas and are confident that Motive's distinctive proposition will gain further traction in our key markets in the near future."

Contacts:

Notes to Editors

Motive Television provides digital television technology and services globally, enabling Television Anytime Anywhere. The market is driven by heightened consumer demand coupled with the mandatory switchover from analogue to digital broadcasting that, as mandated by the International Telecommunication Union, will come into full effect by 2015.

Motive Television provides broadcasters and platform operators with new sources of income and business models via its technologies:

Television Anytime is a technology that permits and enables broadcasters and platform operators to offer enhanced broadcasting services without the need for the Internet. Broadcasters can earn additional income through these services, including Catch-Up TV, Virtual Channels, Video-on-Demand and Targeted Advertising. Television Anytime is currently in commercial operation in Italy and successful tests have been carried out in the Czech Republic and Hungary.

Television Anywhere is an advanced multi-screen and place-changing television technology that allows a viewer to interact, control and watch their Internet-connected home television from a computer, mobile phone, iPad or any other Internet connected device. Television Anywhere is software orientated, does not require an additional box, and can be updated via software upgrades. US patent pending.

Motive Television was founded in London in 2005 and its shares are quoted on the London Stock Exchange (AIM).

http://www.motivetelevision.co.uk/ir/mtv/ir.jsp?page=home

Chairman's statement

Progress

Motive has made considerable progress on its business plan in the first half. Large-scale projects for existing clients have been delivered on budget and on time, with further projects planned. High-level discussions are continuing with a number of large cable, satellite and broadcast platform operators across three continents. 

Restructuring

The Group has undergone a wide-ranging and comprehensive management restructuring and in the Director's opinion is now fit for purpose, with both a strong management and a young and dynamic sales and engineering team. Motive has completed two acquisitions, with operations in Scotland, Barcelona, and Casablanca, and has fully integrated these companies to create a single product and management focus. 

This has enabled the Group to establish more effective solution selling and some operating efficiencies.

Products and services

During the period under review Motive's offering in the digital television technology space was rebranded Television Anytime Anywhere, to clearly reflect what the Group's B2B television broadcasting customers can offer their viewers using Motive's technology and supporting services.

Motive believes that today, the most in-demand feature in the television business is the ability for viewers to watch what they want, when they want it, on any device or screen. By combining and integrating the capabilities of two proprietary technologies acquired in Autumn 2010, Motive has been able to address this requirement. These technologies, combined with Motive's management expertise, have created a bespoke offering in the marketplace that is gaining traction amongst broadcasters.

Television Anytime (formerly Bestv®) enables the offering of added content and push Video-on-Demand to the home, whilst Television Anywhere enables content to be viewed on a wide variety of screens, both in the home and elsewhere. Television Anytime Anywhere can work with a multitude of hardware/consumer electronics environments, whether the TV signal is delivered via Digital Terrestrial (DTT), Satellite, cable television, and/or internet (OTT) providers.

Motive's television expertise has made it possible to offer the combined technology and services platform of Television Anytime Anywhere to broadcasters with a wide array of consumer-facing features and services, including:

·; Catch-Up TV;

·; Video on Demand and Subscription VOD;

·; Virtual +1 channels;

·; Virtual channels/content collections;

·; Targeted advertising;

·; Personal Home Cloud (viewing of live and recorded content from the viewer's set-top box on any internet-connected device, either in the home or on the move);

·; Extreme remote control (control of the PVR and television from outside the home from any connected device);

·; Sideloading (loading of recorded content from a PVR to a portable device for later viewing, without the need for an internet signal); and

·; Uploading (uploading of content from a portable device to a set-top box, perhaps to view pictures or videos previously recorded).

Motive's Television Anywhere technology provides an innovative and flexible approach to the distribution of television content to all screens within the home. It puts the capability of accessing TV on any screen in the hands of the consumer, rather than having cable or satellite operators distributing additional feeds in multiple formats and technologies to iPads and other screens. By placing Motive's proprietary software into a cable or satellite Set-Top-Box (STB), the cable or Direct-To-Home (DTH) provider continues to provide the same service; however, the consumer is now able to connect to their television source from multiple authenticated registered screens and devices in the home. The user experience on any screen is the same as watching the main television and can be consistent across all devices, with viewers able to watch both live programming available on their main TV and programmes recorded on their PVR.

Additionally, Motive's Television Anywhere software platform provides the capability of sideloading (virtual DVDs) and the ability to use any screen as a remote control. The programming enters the home via cable or DTH, with the provider/operator controlling which, if any, programmes are not permitted to be multi-screen.

As well as being much more efficient than other Cloud methods of feeding television to multiple screens in the home, advantages to Motive's Personal Home Cloud include:

·; No need to pay twice (or more) for the same content on different devices;

·; No risk of not being able to access television programs when the Cloud is "down";

·; Ability to watch recorded personal videos in addition to live programs on any device; and

·; Ability to watch on any computer, laptop, tablet (iPad), desktop, connected TV, i.e. any screen with a browser to connect to the in-home wi-fi or internet network.

Recently Motive announced a new product/feature labeled "Video to Go". This enables viewers to side-load a recorded programme from their set-top box to their iPad, or other similar devices, and watch at a later stage without the need of an internet signal, such as when on the move. The Company anticipates commencing a pilot test of this new product with a major client in early autumn 2011.

Sales progress and global expansion

As described in the Company's recent admission document, traditional broadcasters are converting to digital broadcasting worldwide, a process that has been developing rapidly across Europe and worldwide. The US is completely digital both in standard and high definition. This conversion to DTT from analogue broadcasting is creating a very large number of broadcasters who are considering alternative ways of generating revenue in the digital age, thus presenting a growing number of opportunities for Motive.

In addition, pay television operators such as cable television, satellite (DTH), and Internet providers (OTT) represent an additional market for our Television Anytime Anywhere services. Operators can extend and complement their existing product to retain and grow their subscriber base. As a software solution, Motive's technology can be downloaded to existing installed set-top boxes, without having to replace them at substantial cost to offer new features and services.

Motive's Television Anytime Anywhere was launched to the market in February 2011 and has generated serious interest among a growing number of broadcasters and pay television operators in Europe, North America, and South America. The sales process is typically protracted as broadcasters must first familiarise themselves with the new technology and develop business plans for its exploitation. In certain cases, the Company has been assisting its intended future clients in this evaluation process through the use of pilot installations and helping to develop business models. The Board believes that when the economic results of Motive's platform are proven, the sales cycle will shorten.

Business locations

During the period under review, Motive established a Delaware-incorporated US subsidiary, Motive Television Inc., to address its growing business in the United States. The new subsidiary will be headquartered in New York, with operational activities at various client locations.

Motive also has offices in London (headquarters and sales), Barcelona (Television Anytime set-top box engineering), Casablanca (Server-side engineering), Dublin (TV production) and Edinburgh (Television Anywhere technical development).

Sales progress: existing clients

Motive has continued to supply services and innovative solutions to help its first commercial client, the major European DTT broadcaster Mediaset spa, offer a growing array of features to its market. The successful Mediaset Premium On Demand platform has grown substantially in the past six months to provide services to hundreds of thousands of homes and a new package of features, which incorporates Motive's technology, has been launched this summer. Motive participates in the growth and success of the Mediaset platform through royalties on a per STB basis, as well as income for continuing engineering development on Mediaset's behalf. The Company anticipates a growing and deepening relationship with Mediaset in terms of innovation and engineering support, with additional new projects beginning in autumn 2011.

The second major client of the Company, a DTH pay platform in a large fast-growth market, which is served by Motive through a relationship with its middleware provider, is scheduled to launch its new services to consumers in autumn 2011. The Company has undertaken a year-long project to develop new solutions applicable to DTH push Video-on-Demand for this customer, which is nearing completion. Motive has achieved all its milestone commitments to the project and has been receiving progress payments as specified in the contract. The Company has, and will continue to receive, income from engineering development and integration work, plus has upside royalties to share in the success of its platform on a per STB basis.

Sales progress: Europe

During the period, Motive's wholly owned subsidiary, Motive Television Services Limited ("MTS"), entered into a Memorandum of Understanding ("MOU") with CME Media Services Ltd., a subsidiary of Central European Media Enterprises Ltd. ("CME"). The MOU outlines the next phase in CME's evaluation of Motive's Television Anytime Anywhere technologies as both partners work towards a commercial deployment.

The Company is in discussions with some of the largest cable operators in Europe with regard to its Television Anywhere and Video to Go products. Motive is also participating in a consortium that is bidding on a major contract with a national European broadcast transmission supplier. In addition, the Company is in active discussions with DTT broadcasters and pay television operators in many European nations.

Sales progress: USA

Motive Television Inc. reached an agreement with Granite Broadcasting Corporation for a pilot programme at KOFY-TV (KOFY), Granite's television station serving the San Francisco-Oakland-San Jose area of the Californian television market. Under the agreement, Motive will test the Advanced Television Systems Committee (ATSC) version of its Television Anytime Anywhere technology in San Francisco during 2011, in order to identify the most attractive features of the multi-faceted Motive platform for all of Granite's U.S. markets.

San Francisco is one of the most diverse and technologically sophisticated television markets in the United States. As one of the most innovative operators, Granite and its station, KOFY-TV, represent ideal partners for testing Motive's Television Anytime Anywhere technology in the U.S. market.

Additionally, the San Francisco Bay Area is home to Silicon Valley, meaning the pilot program will be showcased in the home of major technology corporations and investors. The Board believes this provides Motive with an opportunity to get its story heard and appear on the radar.

The Company is in conversations with additional US broadcasters that it believes may lead to significant business in 2012 and beyond. In addition, the Company is in discussions with major US cable operators regarding the use of its Television Anywhere and Video to Go technology.

Sales progress: Latin America

The Company reached agreement with Media Networks Latin America S.A.C. (Media Networks), a wholly owned subsidiary of Telefonica Internacional, for a commercial pilot at its operational headquarters in Lima, Peru and the potential rollout among Media Networks clients in Latin America.

Media Networks presently provides turnkey satellite distribution and technical operations services to seven self-owned and third party DTH and Cable pay television operators across five countries in South and Central America.

Research and development

In January 2011 the Company announced that it had successfully enabled the broadcasting of 3D television content to a set-top box using its Television Anytime software datacasting over the digital terrestrial television ("DTT") transmission system, in what the Directors believe to be one of the first in the world. This technology is now being used by our client Mediaset, Italy's largest commercial television broadcaster, which offers one 3D movie per month to Premium Video on Demand households.

The service, called "3VOD" by Motive, demonstrates the versatility and utility of the Television Anytime software for DTT broadcasters. While the number of 3D-enabled televisions is relatively small, this development positions Motive as an industry leader in this growing market.

The Company recently filed a new patent that further enhances its Television Anytime technology. The proposed patent, entitled "Ad Insertion Solution in a Push Environment" was filed on 11 February 2011 in Spain and will be extended across the European Union. This new technology permits broadcasters to introduce targeted advertising related directly to on-demand content viewed, thus increasing the efficiency of advertising spend while providing a new method for advertisers to reach viewers.

During the period the Company also developed Video to Go, a major advancement in its Television Anytime Anywhere platform, enabling the seamless loading of recorded movies and other pre-recorded material to laptops, iPads and other tablet and mobile devices. The advancement allows viewers to transfer a recorded file from their set-top box to a second screen, or mobile device, to watch anytime, anywhere without the need for an internet signal. For example, viewers can pre-load an iPad with content from a home set-top box for later viewing on an aeroplane, viewing in the back of a car, or commuting on a train.

This new technology brings together Motive's two patented capabilities, Television Anytime and Television Anywhere (US patent pending), into one product that allows a viewer to simply sideload content to any mobile device. It also provides opportunities for the hospitality industry, airport lounges and coffee houses to offer Video to Go to their customers.

Motive will be launching this product this autumn, enabling operators and broadcasters to provide:

·; The sideloading of VOD content for viewing anytime and anywhere on any iPad, tablet or mobile platform.

·; The provision of a branded device user interface with social networking interactivity.

Senior Management changes

During the period there were several senior management changes:

·; Graham Loader was appointed Chief Financial Officer, Group Finance Director and Company Secretary;

·; Anthony Combe was appointed Chief Technical Officer;

·; Dr. Glenn Craib was appointed Managing Director NXV Limited; and

·; The board of Adecq Digital S.L. terminated the employments of Andre Vanyi-Robin and of Giuseppe Flores d'Arcais on 29 June 2011. Their positions have been filled by internal promotions.

Financial analysis

In the six months ended 30 June 2011, revenues were £1,094,563 (H1 2010: £370,818). This represents a 195 per cent. increase on the same period in 2010.

Loss from continuing operations for the six month period was £1,704,950 (H1 2010: £535,894).

Loss per share was 0.12p (H1 2010: 0.10p).

Shareholder Funds at 30 June 2011 were £2,585,733 (H1 2010: £11,350), this included cash balances of £996,020 (H1 2010: £152,422).

Summary

During the period under review, Motive has restructured and integrated two entrepreneurial businesses to create a highly motivated team of 27 engineers, marketers, and managers spread over five offices.

The Company has taken two separately developed technologies and combined them into an industry-leading platform, Television Anytime Anywhere, which has valuable features for terrestrial broadcasters and pay television operators.

We have maintained and grown the Company's strong relationship with its first client, Mediaset, one of the world's largest terrestrial broadcasters. In addition, the Board is hopeful that in a few months the Company will see the launch of services with our second client and first major DTH platform.

The Company announced its potential expansion into Central and Eastern Europe through a contract for planning possible services with CME; into the USA with Granite Broadcasting; and in Latin America with Telefonica's Media Networks South America.

The Company is in serious discussions with a number of other broadcasters and pay television platforms on several continents and the Board is confident that these discussions will result in significant continued growth in future years.

We are continuing to develop additional features and capabilities of our platform, in conjunction with our existing and new clients.

Finally, I would like to take this opportunity to thank my fellow Directors, our managers, our staff and our advisers for their support and hard work on your behalf during the period.

Michael Pilsworth

Chairman

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 30 June 2011

STATEMENT OF FINANCIAL POSITION

as at 30 June 2011

STATEMENT OF CASH FLOWS

for the six months ended 30 June 2011

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30 June 2011

1. GENERAL INFORMATION

Motive Television Plc (the "Company") is a company domiciled in England and Wales whose registered office address is Windsor House, Barnett Way, Barnwood, Gloucester GL4 3RT. 

The condensed consolidated interim financial statements of the Company for the six months ended 30 June 2011 comprise the company and its subsidiaries (together referred to as "the Group"). These interim statements do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The interim financial information has been prepared using the same accounting policies, presentation, method of computation and estimation techniques as are expected to be adopted in the Company financial statements for the year ending 31 December 2011 and which were adopted in the audited Group financial statements for the year ended 31 December 2010.

The condensed consolidated interim financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs) as adopted in the EU. While the financial figures included in this half yearly report have been computed in accordance with IFRSs as adopted in the EU applicable to interim periods, this half yearly report does not contain sufficient information to constitute an interim financial report as that term is defined in IAS 34.

The financial information for the year ended 31 December 2010 has been extracted from the statutory accounts for that period. The auditors have reported on the statutory accounts for the year ended 31 December 2010 and their report was not qualified. The auditors' report however drew attention by emphasis of matter to issues surrounding the ability of the company to continue as going concern. A copy of those financial statements has been filed with the Registrar of Companies. 

2. GOING CONCERN

This announcement of interim results has been prepared on the basis that the company is a going concern. The statutory accounts for the year ended 31 December 2010 indicated that additional funding was required in order to allow the Group to undertake the required level of development. Such funding was received in May 2011. There remains an ongoing requirement for the company to win new contracts and/or raise additional funding. If this was not to occur the company would have to take action to reduce its cost base and provisions would be required for costs arising on discontinuance and closure and against the carrying value of goodwill.

3. EXCEPTIONAL ADMINISTRATIVE EXPENSES

The exceptional administrative expenses in 2010 relate to fees in respect of the acquisition of Adecq Digital S.L. and associated re-listing.

4. LOSS PER SHARE

The loss per share is based on a loss for the period of £1,704,950 (six months ended 30 June 2010: £413,678 year ended 31 December 2010: £2,360,917) and the weighted average of ordinary shares in issue for the period of 1,366,372,917 (six months ended 30 June 2010: 504,733,717 year ended 31 December 2010: 636,719,275).

5. NOTES TO THE STATEMENT OF CASH FLOWS

Net cash generated from operating activities - continuing activities

6. HALF-YEARLY RESULTS

Copies of the interim results for the six months ended 30 June 2011 will shortly available from the Company's website www.motivetelevision.co.uk.