19 May 2009 07:00
19 May 2009
BLINKX PLC ANNOUNCES RESULTS FOR THE YEAR ENDED 31 MARCH 2009
blinkx reports record results for the year, revenue increases 113% year on year*
blinkx's interim period conference call will be webcast live at www.blinkx.com on 19 May 2009, at 9:30 a.m. BST/4:30 a.m. EDT/1:30 a.m. PDT.
Cambridge, England and San Francisco, CA - 19 May 2009 - blinkx PLC (BLNX.L), the world's largest video search engine, today reported financial results for the year ended 31 March 2009.
Financial Highlights
| Year to 31 March 2009 (unaudited) | Period from 23 April (incorporation) to 31 March 2008 (unaudited) | |
| $'000 | $'000 | |
| Revenues | 13,933 | 6,545 |
| Gross profit | 9,831 | 4,903 |
| Loss from operations | (10,457) | (18,296) |
| Loss for the year | (8,871) | (16,063) |
| Loss per share (cents) | cents | cents |
| Basic | (3.19) | (6.30) |
| Cash used by operating activities | (9,180) | (12,788) |
| Cash balance as at 31 March | 21,366 | 39,436 |
Highlights:
Revenue more than doubled from FY2008* to almost $14m
Second half revenue grew 108% year on year
Top and bottom line performance ahead of analyst consensus
Gross profits up over 100% to $9.8m from FY2008*
DSO improved to 83 days from 95 days FY2008
Unique visitors up to 88 million from 56 million in March 2008, and page views up to 835 million from 584 million in March 2008 (source: comScore)
Daily Video Search run rate of over 8,400,000 per day in March 2009
Content hours increased 35% year on year, from 26 million hours to 35 million hours
175 new content partners added in the year, bringing total to over 530 media organizations, including Fox, CBS and Time Inc.
Partnership with Miniweb brings blinkx directly onto TVs
Addition of top-tier syndication partners, including ITN, MSN UK and Rambler
New versions released of three strategic technology offerings:
blinkx Remote
blinkx Beat
blinkx BBTV (Broadband Television)
blinkx maintained strong, consistent average effective CPM in FY09, running campaigns for leading brands, including Shell, Guinness and Honda
Ranked in top 20 video sites by Comscore Video Metrix and Nielsen
* FY08 contains 49 weeks of trading
Commenting on the preliminary results Suranga Chandratillake, founder and CEO of blinkx, said: "We are pleased to report a very strong performance this year, with revenue increasing by 113%, year on year, despite the difficult macro-economic environment. While general industry CPMs (Cost Per Mille) have suffered in the worsening economy, blinkx's CPM rates have continued to retain their high value through the year because our unique targeting technology enables our customers to derive guaranteed and controllable Return On Investment (ROI) from their advertising spend. While the current macro market conditions mean we are maintaining a suitably cautious and conservative stance, the success of our targeted advertising products in 2009 makes us confident of continued strong growth into 2010.
In the last 12 months, we have continued to make significant achievements on the technology and business development fronts - introducing three new products, and signing partnerships with leaders in the technology and entertainment industries, including Fox, CBS and Microsoft. Enhancements to our site have been extremely well-received by audiences, resulting in an increase in traffic of almost 53% between March 2008 and March 2009, and attracting top-tier brand advertisers, such as Honda, Guinness and Shell."
Mr. Chandratillake continued: "We see 2009 as a year of tremendous potential: the continued success of the ROI-driving Cost Per Action (CPA) model of advertising, coupled with the increasing number of top tier media companies and broadcasters who are distributing their content on the Internet, have come at a time when demand for rich media online is at an all time high, and our viewership is growing faster than ever before. Moreover, packaged goods manufacturers, pharmaceutical companies and telecommunications firms, three of the largest historical spenders on traditional media, are moving their advertising budgets online at a record pace, according to recent studies by Nielsen (The Global Online Media Landscape, April 2009).
Mr. Chandratillake concluded: "These factors, combined with the increased availability of high quality online video, have laid the foundation for us to solidify our position as the premier destination for online TV and video. We will continue our strong investment in both our brand and technology to capitalize on this 'once-in-a- generation' opportunity."
Financial Highlights
For the financial year ended 31 March 2009 (FY2009), revenues totaled $13.9 million increasing 113% over the $6.5 million in revenues reported for the period from 23 April (incorporation) through 31 March 2008 (FY2008) which contained 49 weeks of trading. Gross profit for FY2009 was $9.8 million representing a gross margin of 71%. Gross profit for FY2008 was $4.9 million, representing a gross margin of 75%. Net loss for the FY2009 was $8.9 million. Net loss for FY2008 was $16.1 million. Loss per share for FY2009 was 3.19 cents and for FY2008 was 6.30 cents. blinkx's cash balance at 31 March 2009 was $21.4 million. (FY2008: $39.4 million)
Customer and Business Developments
Continued strong demand for blinkx's unique, patented search technology has advanced blinkx's position as the gold standard in video search this period. High-profile new syndication customers included Microsoft (MSN UK) and Markit, a financial information services company, whose clients include some of the world's leading financial institutions.
In addition to maintaining its video search stronghold on computers, blinkx made the leap from PC to TV this period, signing an agreement with Interactive Service Provider, Miniweb, to power search, recommendations and ad targeting on Miniweb's pioneering interactive TV platform. Recent research from In-Stat analysts forecasts that, in five years, there will be 24 million U.S. broadband households viewing Web-to-TV content ("Web-To-TV Video Changes Everything", April 2009). This fusion of broadcast and broadband TV will give audiences access to an incredibly rich and diverse universe of media, and as the leader in video search, blinkx is ideally suited to help viewers navigate this universe. Miniweb, the recipient of Best Interactive Service/Application award at IPTV World 2009, selected blinkx for its unrivalled functionality, which will allow audiences to search and discover content seamlessly from both broadcast television and internet video, including relevant portions of blinkx's index of video content, through suitable Miniweb-enabled devices.
In the past six months, blinkx has expanded its roster of premier media partners to over 530, including the addition of programming from industry leaders such as Fox, CBS and Time Inc. blinkx's index of fully searchable online video has now surpassed 35 million hours, increasing 35% in the last 12 months, from 26 million hours.
blinkx AdHoc, the first contextual advertising platform for online TV, has experienced significant growth since its launch in June 2007, powering advertising campaigns for top consumer brands, including Guinness and Sony, as well as Verizon, in an example of the telecommunications industry's shifting focus to online advertising strategies. In addition, blinkx unveiled a new video advertising unit - the Unroll - an entirely unique and immersive branding experience that engages users with a brand continuously throughout a video. The unit has been successfully deployed by MediaCom for its client, Shell Oil, among others.
Product and Technology Developments
During FY2009 blinkx continued to lead the industry with unique and disruptive product launches, introducing three new offerings based on its patented technology. Highlights included the release of blinkx Beat, blinkx Remote in August 2008, and blinkx Broadband Television (BBTV) in April 2008.
blinkx Beat is a downloadable application that delivers an endless channel of the most engaging, handpicked, bite-sized videos from around the Web, which has enjoyed tremendous success among blinkx users. blinkx Beat now garners over 2 million video views per day, a figure that has doubled each week since January 2009.
blinkx Remote is an advanced tool for finding full-length TV episodes on the Web. As the volume of long-form television content available on the Internet has exploded, consumers have benefited tremendously from increased access to and availability of their favorite TV shows, but the proliferation and fragmentation of this content across multiple sites present a navigation challenge. blinkx Remote aggregates information and access to full-length television programs on the Internet, offering audiences a single gateway for finding TV shows by channel, season, episode, title or genre. blinkx Remote has enjoyed tremendous success among users, with audience numbers growing an average of 83% every month since launch.
blinkx BBTV is a significant advance in online television that leverages blinkx's patented speech and visual recognition technology to simultaneously deliver a high-quality television experience over the Internet, and link it to the universe of information on the Web, adding dimension and context to the viewer's experience.
Company Developments
During the period blinkx experienced dramatic expansion in its user base to 88 million unique visitors in March 2009 from 56 million unique visitors in March 2008 (source: comScore), and was recognized by third-party research and reporting firms as one of the fastest growing websites on the Internet. According to Compete.com, blinkx is the fastest growing video site among the top 20 video competitors in the U.S.
www.blinkx.com is consistently ranked in the top 20 video sites by both Comscore Video Metrix and Nielsen.
About blinkx PLC
blinkx (London AIM: BLNX) is the world's most comprehensive video search engine. Today, blinkx has indexed more than 35 million hours of audio, video, viral and TV content, and made it fully searchable and available on demand. blinkx's founders set out to solve a significant challenge - as TV and user-generated content on the Web explode, keyword-based search technologies only scratch the surface. blinkx's patented search technologies listen to - and even see - the Web, helping users enjoy a breadth and accuracy of search results not available elsewhere. In addition, blinkx powers the video search for many of the world's most frequented sites. blinkx is based in San Francisco and London. More information is available at www.blinkx.com
For further information please contact:
| Financial Media Contacts | Analyst and Investor Contact |
| Edward Bridges/Charles Palmer/ Haya Chelhot Financial Dynamics Tel: (UK) 020 7831 3113 | Jonathan Spira, CFO blinkx PLC Tel: (US) 415 615 1513 |
BLINKX PLC
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
Results for the year to 31 March 2009
(in thousands, except per share amounts)
| Year ended 31 March 2009 (unaudited) | Period from 23 April 2007 (incorporation) to 31March 2008 (unaudited) | |
| $'000 | $'000 | |
| Revenue: continuing operations | 13,933 | 6,545 |
| Cost of revenue | (4,102) | (1,642) |
| Gross profit | 9,831 | 4,903 |
| Operating expenses | ||
| Research and development | 4,526 | 3,171 |
| Sales and marketing | 13,952 | 7,273 |
| Administrative expenses | 1,810 | 1,300 |
| Demerger / IPO costs | - | 11,455 |
| Loss from operations | (10,457) | (18,296) |
| Investment revenues | 1,127 | 1,983 |
| Loss before taxation | (9,330) | (16,313) |
| Tax | 459 | 250 |
| Loss for the year attributable to equity holders of the parent | (8,871) | (16,063) |
| Loss per share (cents) | cents | cents |
| Basic and diluted | (3.19) | (6.30) |
BLINKX PLC
CONSOLIDATED BALANCE SHEET (UNAUDITED)
As at 31 March 2009
(in thousands)
| As at 31 March 2009 (unaudited) | As at 31 March 2008 (unaudited) | |
| $'000 | $'000 | |
| ASSETS | ||
| Non-current assets | ||
| Intangibles assets | 1,862 | 5 |
| Property, plant and equipment | 486 | 447 |
| Other receivables | 426 | - |
| 2,774 | 452 | |
| Current assets | ||
| Trade receivables | 3,181 | 1,816 |
| Other receivables | 1,827 | 1,585 |
| Cash and cash equivalents | 21,366 | 39,436 |
| 26,374 | 42,837 | |
| Total assets | 29,148 | 43,289 |
| LIABILITIES | ||
| Current liabilities | ||
| Trade and other payables | (4,520) | (2,022) |
| (4,520) | (2,022) | |
| Non current liabilities | ||
| Other payables | (426) | - |
| Total Liabilities | (4,946) | (2,022) |
| Net assets | 24,202 | 41,267 |
| Shareholders' equity | ||
| Share capital | 5,487 | 5,483 |
| Share premium account | 49,126 | 49,126 |
| Stock compensation reserve | 7,863 | 6,429 |
| Currency translation reserve | (9,116) | 516 |
| Merger reserve | (4,323) | (4,323) |
| Retained earnings | (24,835) | (15,964) |
| Total equity | 24,202 | 41,267 |
BLINKX PLC
CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
Results for year to 31 March 2009
(in thousands)
| 12 months ended 31 March 2009 (unaudited) | Period from 23 April 2007 (incorporation) to 31 March 2008 (unaudited) | |
| $'000 | $'000 | |
| CASH FLOWS FROM OPERATING ACTIVITIES | ||
| Loss from operations | (10,457) | (18,296) |
| Adjustments for: | ||
| Depreciation and amortisation | 308 | 263 |
| Share based payments | 1,434 | 6,501 |
| Foreign exchange gains | (313) | (123) |
| Operating cash flows before movements in working capital | (9,028) | (11,655) |
| Changes in operating assets and liabilities: | ||
| Increase in trade and other receivables | (3,333) | (3,155) |
| Increase in trade and other payables | 2,924 | 2,022 |
| Net cash used by operations | (9,437) | (12,788) |
| Income taxes received | 257 | - |
| Net cash used by operating activities | (9,180) | (12,788) |
| CASH FLOWS FROM INVESTMENT ACTIVITIES | ||
| Interest received | 1,127 | 1,983 |
| Purchase of property, plant and equipment | (702) | (715) |
| Net cash generated by investment activities | 425 | 1,268 |
| CASHFLOWS FROM FINANCING ACTIVITIES | ||
| Proceeds from issuance of shares | 4 | 50,384 |
| Net cash generated by financing activities | 4 | 50,384 |
| Net (decrease) / increase in cash and cash equivalents | (8,751) | 38,864 |
| Beginning cash and cash equivalents | 39,436 | - |
| Effect of foreign exchange on cash and cash equivalents | (9,319) | 572 |
| Ending cash and cash equivalents | 21,366 | 39,436 |
BLINKX PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
For the year ended 31 March 2009
(in thousands)
| Ordinary | Redeemable | Share | Stock | |||
| share | share | premium | compensation | |||
| capital | capital | account | reserve | Sub-total | ||
| $'000 | $'000 | $'000 | $'000 | $'000 | ||
| Balance as at 23 April 2007 (incorporation) | - | - | - | - | - | |
| Issue of shares | 5,483 | 100 | 49,126 | - | 54,709 | |
| Capital contribution | - | - | - | - | - | |
| Shares redeemed | - | (100) | - | - | (100) | |
| Period losses | - | - | - | - | - | |
| Exchange differences on translation | - | - | - | - | - | |
| Share based payments | - | - | - | 6,429 | 6,429 | |
| Balance as at 1 April 2008 | 5,483 | - | 49,126 | 6,429 | 61,038 | |
| Issue of shares | 4 | - | - | - | 4 | |
| Current year losses | - | - | - | - | - | |
| Exchange differences on translation | - | - | - | - | - | |
| Share based payments | - | - | - | 1,434 | 1,434 | |
| Balance as at 31 March 2009 | 5,487 | - | 49,126 | 7,863 | 62,476 | |
| Currency | ||||||
| Sub-total | translation | Merger | Retained | |||
| forwarded | reserve | reserve | earnings | Total | ||
| $'000 | $'000 | $'000 | $'000 | $'000 | ||
| Balance as at 23 April 2007 (incorporation) | - | - | - | - | - | |
| Issue of shares | 54,709 | - | (4,323) | - | 50,386 | |
| Capital contribution | - | - | - | 99 | 99 | |
| Shares redeemed | (100) | - | - | - | (100) | |
| Period losses | - | - | - | (16,063) | (16,063) | |
| Exchange differences on translation | - | 516 | - | - | 516 | |
| Share based payments | 6,429 | - | - | - | 6,429 | |
| Balance as at 1 April 2008 | 61,038 | 516 | (4,323) | (15,964) | 41,267 | |
| Issue of shares | 4 | - | - | - | 4 | |
| Current year losses | - | - | - | (8,871) | (8,871) | |
| Exchange differences on translation | - | (9,632) | - | - | (9,632) | |
| Share based payments | 1,434 | - | - | - | 1,434 | |
| Balance as at 31 March 2009 | 62,476 | (9,116) | (4,323) | (24,835) | 24,202 |
BLINKX PLC
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (UNAUDITED)
1. Basis of preparation
The financial information set out in the announcement does not constitute the Company's statutory accounts for the year ended 31 March 2009, within the meaning of Section 240 of the Companies Act 1985. The audit of the statutory accounts for the year ended 31 March 2009 is not yet complete. These accounts will be finalized on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's annual general meeting.
Statutory financial statements for the period ended 31 March 2008 are available on the Group's website www.blinkx.com and have been filed with the Registrar of Companies. The Group's auditors issued a report on those financial statements that was unqualified and did not contain a statement under section 237(2) or section 237(3) of the Companies Act 1985.
The Group has considerable financial resources and the directors believe that the Group is well placed to manage its business risks successfully despite the current uncertain economic outlook.
After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
2. Share-based payments
Included within operating expenses are the following amounts in respect of share based payments:
| 12 months ended 31 March 2009 (unaudited) | Period from 23 April 2007 (incorporation) to 31March 2008 (unaudited) | |
| $'000 | $'000 | |
| Sales and marketing | 564 | 2,488 |
| Research and development | 768 | 3,567 |
| Administrative expenses | 102 | 593 |
| 1,434 | 6,648 | |
3. Taxation
A tax credit of $459,000 (period from 23 April 2007 to 31 March 2008: $250,000) is reflected in the income statement in relation to research and development tax credits.
4. Loss per share
The loss per ordinary share and diluted loss per share are equal because share options are only included in the calculation of diluted earnings per share if their issue would decrease the net earnings per share or increase the net loss per share. The calculation is based on information in the table shown below.
| 12 months ended 31 March 2009 (unaudited) | Period from 23 April 2007 (incorporation) to 31March 2008 (unaudited) | |
| $'000 | $'000 | |
| Earnings | ||
| Loss (used in calculation of basic and diluted loss per share) | (8,871) | (16,063) |
| Number of shares | ||
| Weighted average number of shares | 278,075,720 | 254,952,682 |
| for the purpose of basic and diluted earnings per share |
5. Share capital
The issuance of shares in the year relates to the exercise of employee share options.