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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Mobile Streams Plc | LSE:MOS | London | Ordinary Share | GB00B0WJ3L68 | ORD 0.01P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.0375 | 0.035 | 0.04 | 0.0375 | 0.0375 | 0.0375 | 46,101,798 | 08:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Communications Services, Nec | 1.82M | -3.79M | -0.0007 | -0.57 | 2.13M |
TIDMMOS
RNS Number : 0764B
Mobile Streams plc
31 March 2017
31 March 2017
Mobile Streams plc ("Mobile Streams" or the "Company") (AIM: MOS)
Half yearly report
Mobile Streams is pleased to announce its unaudited interim results for the six months ended 31 December 2016.
Highlights
-- Subscriber numbers in India increased to over 175,000 active subscribers* (up from 100,000 at the period end)
-- Successful fundraising of GBP2.2m (before expenses) to fund growth in India
-- GBP2.8m of cash and cash equivalents at 31 December 2016 (31 December 2015: GBP1.5m), with no debt. The Company's current cash balance is GBP2.6m
-- Revenues of GBP3.6m (H1 2015: GBP8m). All revenue is from continuing operations -- Mobile Internet revenues were GBP3.58m (6 months ended 31 December 2015: GBP7.9m)
-- EBITDA** loss of GBP712k in line with management expectations (6 months ended 31 December 2015: GBP104k loss)
-- Post-tax loss of GBP879k in line with management expectations (6 months to 31 December 2015: GBP321k loss)
-- Launch of HTML5 browser based games service to complement its app download service in India (post-period end)
* Active subscribers are measured as consumers who have made a purchase from the Company in the country in the past 60 days. For like-for-like comparability, this is the same methodology the Company uses to measure subscribers in its other markets such as Argentina
** Earnings before interest, tax, depreciation, amortisation and share compensation ("EBITDA") is a non IFRS measure which the Group uses to assess its performance. It is defined as earnings before interest, tax, depreciation, amortisation and share compensation.
Commenting, Simon Buckingham, CEO of Mobile Streams said: "The successful fundraising of GBP2.2 million (before expenses) completed at the end of the period is enabling us to accelerate our strategy of building subscribers and revenues in the Indian market during calendar year 2017. Whilst Argentina remains a challenging place to do business, we expect India to continue to grow steadily throughout 2017 as we focus on and invest in the market. It is particularly pleasing that we have surpassed the 175,000 subscriber mark so quickly and we look forward to updating shareholders on our progress at the appropriate time."
Enquires:
Mobile Streams
Simon Buckingham, Chief Executive Officer +1 347 669 9068
Enrique Benasso, Chief Financial Officer
N+1 Singer (Nominated Adviser and Broker)
Alex Price +44 20 7496 3000
Alex Laughton Scott
India
Mobile Streams India Private Limited exceeded the important milestone of reaching 100,000 active subscribers to its MobileGaming.com games subscription service by 31 December 2016, a figure which has subsequently grown to over 175,000 active subscribers.
In India, most of the growth in active subscribers to date has been driven by subscription growth enabled by its direct billing connections with two of the three largest local mobile phone operators. The Company is working to add additional direct billing connections for the one remaining local top three network operator as well as to two additional local Indian mobile network operators, each with approximately 100 million subscribers.
Post-period end the Company launched its browser based games service to compliment its app download service in India. This HTML5 based service has gone live with billing connectivity from its largest partner, with another large partner scheduled to launch before the end of the current financial year.
Argentina
As previously announced, trading in Argentina continued to be challenging throughout the first half of the current financial year as a result of general market conditions and regulation in the local market for mobile content subscriptions. These conditions are expected to remain in place during the remainder of the financial year and beyond.
OPERATING REVIEW
Mobile internet
The Group anticipated the shift to the open Mobile Internet business model several years ago and added new products at new price points in new markets, which includes basically the start-up in India during the last fiscal year.
The mobile internet business model (based on Mobile Internet) shifted to a model based on the operator platforms and the revenue based on internet decreased. This was mostly the result of the economic conditions in Argentina which includes the devaluation of the Argentine peso during the last 2 years, resulting in a fall in sales.
During the first half of the year, Latin America, primarily Argentina, accounted for the majority of revenues, as during the last years.
Mobile operators
The Group has several contracts with mobile operators that allow the distribution of content through their mobile portals, although the revenue has been reduced by more than 56% year on year partially because of the fact that consumers prefer to use the open mobile internet services on their smartphones and partly because of our own increased focus on Mobile Internet services.
There was a reduction in the number of consumer visitors to these portals, which has been a continuing trend for several years. Our teams share and implement the best retailing practices in order to increase the conversion of visitors into customers to mitigate the natural decline in this revenue stream as the market changes.
FINANCIAL REVIEW
For the 6 months ended 31 December 2016.
Gross profit for the six month period ended 31 December 2016 was GBP1.1m (2015: GBP2.1m). Gross margin was 29.6%, up from 25.9% in 2015.
Mobile Internet revenue has decreased by 54.7% to GBP3.58m (2015: GBP7.9m). The cost of sales on mobile internet revenue is much higher than on operator revenue because of marketing costs resulting in a lower overall gross profit margin.
The Group recorded a loss after tax of GBP879k for the 6 months ended 31 December 2016 (2015: loss GBP321k), generating a loss per share of 2.175 pence per share (2015: 0.865 pence loss per share).
Adjusted loss per share (excluding depreciation, amortisation, impairments and share compensation expense) was 1.9 pence per share (2015: 0.674 pence adjusted loss per share).
Cash and cash equivalents
The Argentine peso remained stable during the semester, caused by the release of currency restrictions, meaning that currency can now flow freely in and out of Argentina. This policy was adopted by the country's new elected president in November 2015. Current cash balances are GBP2.8m.
Capital fundraising
The fundraising of GBP2.2 million gross proceeds (GBP2 million net proceeds) completed at the end of December 2016 is enabling us to both continue and also accelerate our strategy of building subscribers and revenues in the Indian market during calendar year 2017.
Outlook
Whilst Argentina remains a challenging place to do business, the Directors expect subscriber numbers in India to continue to grow steadily throughout 2017 as the Group focuses on and invests in that market.
Marketing investment in India, funded by the recent issue of shares for cash, has been growing during the past half year and is expected to continue growing. The Company looks forward to updating shareholders on its progress at the appropriate time.
Argentina remains a difficult market but with more focus on a key local mobile operator and with market knowledge acquired during past few years, the Directors are optimistic about being able to stabilise the position in that region.
Overall the Board expects the rest of 2017 to see continued investment as the Company looks to build a strong position in India.
CONSOLIDATED INCOME STATEMENT Unaudited Unaudited Audited 6 months 6 months 12 months ended 31 ended 31 ended 30 December December June 2016 2015 2016 GBP000's GBP000's GBP000's Revenue 3,640 8,033 12,786 Cost of sales (2,563) (5,948) (9,256) ------------------------------------- ----------- ----------- ----------- Gross profit 1,077 2,085 3,530 Selling and marketing costs (349) (771) (1,333) Administrative expenses ** (1,549) (1,489) (3,048) Operating Loss (821) (175) (851) Finance income 78 47 118 Finance expense (2) (13) (4) ----------- ----------- ----------- Loss before tax (745) (141) (737) Tax expense (134) (180) (569) Loss for the period (879) (321) (1,306) ===================================== =========== =========== =========== Attributable to: Attributable to equity shareholders of Mobile Streams Plc (879) (321) (1,306) ===================================== =========== =========== =========== Earnings Per Share Pence per Pence per Pence per share share share Basic loss per share (2,167) (0,865) (3,519) Diluted loss per share (2,167) (0,865) (3,519) * *Administrative expenses include depreciation, amortisation, impairment and share based compensation.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Unaudited Unaudited Audited 6 months 6 months 12 months ended 31 ended ended December 31 December 30 June 2016 2015 2016 GBP000's GBP000's GBP000's Loss for the period (879) (321) (1,306) Exchange differences on translating foreign operations 74 (822) (1,017) Total comprehensive loss for the period (805) (1,143) (2,323) ===================================== =========== ============== =========== Total comprehensive loss for the period attributable to: Equity shareholders of Mobile Streams Plc (805) (1,143) (2,323) ------------------------------------- ----------- -------------- ----------- CONSOLIDATED STATEMENT OF FINANCIAL POSITION Unaudited Unaudited Audited 6 months ended 6 months ended 12 months ended 31 December 31 December 30 June 2016 2016 2015 GBP000's GBP000's GBP000's Assets Non- Current Intangible assets - 1 - Property, plant and equipment 8 52 20 Deferred tax asset 189 - 189 ---------------- ---------------- -------------- 197 53 209 Current Trade and other receivables 1,870 3,307 2,576 Cash and cash equivalents 2,780 1,512 1,367 4,650 4,819 3,943 Total assets 4,847 4,872 4,152 ================================= ================ ================ ============== Equity Equity attributable to equity holders of Mobile Streams Plc Called up share capital 1,164 74 74 Share Premium 11,482 10,579 10,579 Translation reserve (3,076) (2,955) (3,150) Retained earnings (6,723) (5,059) (5,943) -------------------------------- ---------------- ---------------- Total equity 2,847 2,639 1,560 --------------------------------- ---------------- ---------------- -------------- Liabilities Current Trade and other payables 1,463 1,607 1,595 Current tax liabilities 537 626 997 -------------------------------- ---------------- ---------------- -------------- 2,000 2,233 2,592 Total liabilities 2,000 2,233 2,592 -------------------------------- ---------------- ---------------- -------------- Total equity and liabilities 4,847 4,872 4,152 ================================= ================ ================ ============== CONSOLIDATED CASH FLOW STATEMENT Unaudited Unaudited Audited 6 months 6 months 12 months ended 31 ended 31 ended 30 December December June 2016 2015 2016 GBP000's GBP000's GBP000's Operating activities Profit before taxation (745) (141) (737) Adjustments: Shared based payments 97 44 146 Depreciation 14 27 59 Interest received (78) (47) (118) Changes in Trade and other receivables 706 709 304 Changes in Trade and other payables (132) (483) 13 Tax Paid (460) (219) (237) Interest paid (2) (13) - Total cash utilised in operating activities (600) (123) (570) ----------------------------------------- ----------- ----------- ----------- Investing Activities Additions to property, plant and equipment (1) (1) (8) Interest received 78 47 118 Net Cash generated from investing activities 77 46 110 ----------------------------------------- ----------- ----------- ----------- Issue of share capital (net of expenses paid) 1,993 - - Net Cash generated from financing activities 1,993 - - ----------------------------------------- ----------- ----------- ----------- Net change in cash and cash equivalents 1,470 (77) (460) Cash and cash equivalents at beginning of period 1,367 2,098 2,098 Exchange (loss)/ gain on cash and cash equivalents (57) (509) (271) Cash and cash equivalents, end of period 2,780 1,512 1,367 ----------------------------------------- ----------- ----------- ----------- CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Called Share Translation Retained Total up share premium reserve earnings Equity capital GBP000's GBP000's GBP000's GBP000's GBP000's Balance at 1 July 2015 74 10,579 (2,133) (4,782) 3,738 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Credit for share based payments - - - 44 44 Transactions with owners - - - 44 44 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Loss for the 6 months ended 31 December 2015 - - - (321) (321) Exchange differences on translating foreign operations - - (822) - (822) Total comprehensive income for the period - - (822) (321) (1,143) --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Balance at 31 December 2015 74 10,579 (2,955) (5,059) 2,639 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Balance at 1 January 2016 74 10,579 (2,955) (5,059) 2,639 Credit for share based payments - - - 101 101 Transactions with owners - - - 101 101 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Loss for the 6 months ended 30 June 2016 - - - (985) (985) Exchange differences on translating foreign operations - - (195) - (195) Balance at 30 June 2016 74 10,579 (3,150) (5,943) 1,560 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Balance at 1 July 2016 74 10,579 (3,150) (5,943) 1,560 Credit for share based
payments - - - 97 97 Transactions with owners - - - 97 97 --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Loss for the 6 months ended 31 December 2016 - - - (879) (879) Exchange differences on translating foreign operations - - 74 - 74 Issue of share capital (net of expenses paid) 1,090 903 - - 1,993 Total comprehensive income for the period - - 74 (879) (805) --------------- ------------------ --------------------- ----------------------- ------------------- --------------- Balance at 31 December 2016 1,164 11,482 (3,076) (6,725) 2,845 --------------- ------------------ --------------------- ----------------------- ------------------- ---------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The interim results of Mobile Streams PLC are prepared in accordance with the requirements of IAS 34 Interim Financial Reporting as adopted by the EU and prepared in accordance with the accounting policies set out in the last financial statements for the 12 months ended 30 June 2016.
The interim results, which are not audited, do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006.
The comparative financial information for the 12 months ended 30 June 2016 has been extracted from the statutory accounts for that period. In addition, the financial information for the 6 months ended 31 December 2016 has been extracted from the unaudited Interim results. The full audited accounts of the Group for the 12 months ended 30 June 2016 were prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union and have been delivered to the Registrar of Companies.
The auditor's report on these financial statements was unqualified and did not contain statements under S498(2) or S498(3) of the Companies Act 2006.
2. SEGMENT REPORTING
As at 31 December 2016, the Group was organised into 4 geographical segments: Europe, North America, Latin America, and Asia Pacific. Revenues were from external customers only and generated from three principal business activities: the sale of mobile content through MNO s (Mobile Operator sales), the sale of mobile content over the internet (Mobile Internet sales) and the provision of consulting and technical services (Other Service Fees).
All operations are continuing and all inter-segment transfers are priced and carried out at arm's length.
The segmental results for the 6 months ended 31 December 2016 were as follows: GBP000's Europe Asia North America Latin America Group Mobile operator sales 17 - 35 - 52 Mobile internet sales - 113 2 3,466 3,581 Other service fees 6 - 1 - 7 ---------------------------- ------- ------ -------------- -------------- -------- Total Revenue 23 113 38 3,466 3,640 Cost of sales (9) (81) (6) (2,467) (2,563) ---------------------------- ------- ------ -------------- -------------- -------- Gross profit 14 32 32 999 1,077 Operating expenses (297) (147) (73) (1,272) (1,789) ---------------------------- ------- ------ -------------- -------------- -------- EBITDA* (283) (115) (41) (273) (712) ---------------------------- ------- ------ -------------- -------------- -------- Depreciation, amortisation - - - (14) (14) Share based compensation (97) - - - (97) Finance income - - - 77 77 ---------------------------- ------- ------ -------------- -------------- -------- Profit/(Loss) before tax (380) (115) (41) (210) (746) Income tax expense (84) - - (49) (133) ---------------------------- ------- ------ -------------- -------------- -------- Profit/(Loss) after tax (464) (115) (41) (259) (879) *Calculated as profit before tax, interest, amortization, depreciation, share compensation expense and impairment of assets. The segmental results for the 6 months ended 31 December 2015 were as follows: GBP000's Europe Asia North America Latin America Group Mobile operator sales 8 5 19 80 112 Mobile internet sales - - 4 7,901 7,905 Other service fees 15 - - 1 16 ------------------------------ ------- ----- -------------- -------------- -------- Total Revenue 23 5 23 7,982 8,033 Cost of sales (40) (14) (10) (5,884) (5,948) ------------------------------ ------- ----- -------------- -------------- -------- Gross profit / (loss) (17) (9) 13 2,098 2,085 Operating expenses (291) (86) (70) (1,742) (2,189) ------------------------------ ------- ----- -------------- -------------- -------- EBITDA* (308) (95) (57) 356 (104) ------------------------------ ------- ----- -------------- -------------- -------- Depreciation, amortisation - - - (27) (27) Share based compensation (44) - - - (44) Revenue/expense intercompany 238 - - (238) - Finance income - - 1 33 34 ------------------------------ ------- ----- -------------- -------------- -------- Profit/(Loss) before tax (114) (95) (56) 124 (141) Income tax expense - - - (180) (180) ------------------------------ ------- ----- -------------- -------------- -------- Profit/(Loss) after tax (114) (95) (56) (56) (321) *Calculated as profit before tax, interest, amortization, depreciation, share compensation expense and impairment of assets. The segmental results for the year ended 30 June 2016 were as follows: North Latin GBP000's Europe Asia Pacific America America Group Mobile Operator Services 31 6 58 80 175 Mobile Internet Services - 21 11 12,552 12,584 Other Service fees 23 - - 5 28 ---------------------------- ------- ------------- --------- --------- -------- Total Revenue 54 27 69 12,637 12,786 Cost of sales (33) (29) (30) (9,165) (9,257) ---------------------------- ------- ------------- --------- --------- -------- Gross profit/(loss) 21 (2) 39 3,472 3,530 Operating expenses (557) (317) (113) (3,189) (4,176) ---------------------------- ------- ------------- --------- --------- -------- EBITDA* (536) (319) (74) 283 (646) ---------------------------- ------- ------------- --------- --------- -------- Depreciation, amortisation and impairment - (1) - (57) (58) Share based compensation (146) - - - (146) Finance income/expense - - - 113 113 ---------------------------- ------- ------------- --------- --------- -------- Profit/(Loss) before tax (682) (320) (74) 339 (737) Taxation - - - (569) (569) ---------------------------- ------- ------------- --------- --------- -------- Loss after tax (682) (320) (74) (230) (1,306) *Calculated as profit before tax, interest, amortization, depreciation, share compensation expense and impairment of assets. The segmental assets at 31 December 2016 were as follows: North Latin GBP000's Europe Asia America America Group Non current fixed assets Property, plant & equipment - - - 8 8 ----------------------------- ------- ----- --------- --------- -------- Intangible assets - - - - -
----------------------------- ------- ----- --------- --------- -------- Deferred tax - - - 189 189 ----------------------------- ------- ----- --------- --------- -------- Current assets 1,887 201 151 2,411 4,650 ----------------------------- ------- ----- --------- --------- -------- Cash and cash equivalents 1,853 44 59 824 2,780 Accounts receivable 4 89 4 349 446 Accrued receivables 11 3 40 182 236 Prepayments 13 3 12 678 706 Minimum guarantees and advances - - - 4 4 Other assets 6 62 36 374 478 TOTAL ASSETS 1,887 201 151 2,608 4,847 ============================= ======= ===== ========= ========= ======== Current liabilities (156) (56) (313) (1,475) (2,000) ----------------------------- ------- ----- --------- --------- -------- Trade Payables (72) (29) (35) (157) (293) Accrued content costs (33) (30) (261) (322) (646) Other accrued liabilities (52) 22 (17) (376) (423) Other payables 1 (19) - (83) (101) Corporate income tax payable - - - (537) (537) TOTAL LIABILITIES (156) (56) (313) (1,475) (2,000) ============================= ======= ===== ========= ========= ======== The segmental assets at 31 December 2015 were as follows: North Latin GBP000's Europe Asia America America Group Non current fixed assets Property, plant & equipment - - - 52 52 --------------------------- ------- ----- --------- --------- -------- Intangible assets - - 1 - 1 --------------------------- ------- ----- --------- --------- -------- Current assets 183 218 347 4,071 4,819 --------------------------- ------- ----- --------- --------- -------- Cash and cash equivalents 108 35 254 1,115 1,512 Accounts receivable 14 54 13 590 671 Accrued receivables 8 104 40 471 623 Prepayments 25 10 10 1,678 1,723 Minimum guarantees and advances - - - 13 13 Other assets 28 15 30 204 277 TOTAL ASSETS 183 218 348 4,123 4,872 =========================== ======= ===== ========= ========= ======== Current liabilities (167) (68) (275) (1,723) (2,233) --------------------------- ------- ----- --------- --------- -------- Trade Payables (72) (37) (30) (168) (307) Accrued content costs (30) (17) (230) (447) (724) Other accrued liabilities (43) (1) (15) (302) (361) Other payables (22) (13) - (180) (215) Corporate income tax payable - - - (626) (626) TOTAL LIABILITIES (167) (68) (275) (1,723) (2,233) =========================== ======= ===== ========= ========= ========
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
The segmental assets at 30 June 2016 were as follows: North Latin GBP000's Europe Asia America America Total Non current fixed assets Property, plant & equipment - - 1 19 20 ----------------------------- ------- ----- --------- --------- -------- Intangible assets - - - - - ----------------------------- ------- ----- --------- --------- -------- Current assets 84 116 176 3,756 4,132 ----------------------------- ------- ----- --------- --------- -------- Cash and cash equivalents 29 35 60 1,243 1,367 Accounts receivable - 56 7 490 553 Accrued receivables 12 8 39 374 433 Prepayments 15 5 11 1,223 1,254 Minimum guarantees and advances - - - 13 13 Other assets 28 12 59 224 323 Deferred tax asset - - - 189 189 TOTAL ASSETS 84 116 177 3,775 4,152 ============================= ======= ===== ========= ========= ======== Current liabilities (162) 35 (297) (2,168) (2,592) ----------------------------- ------- ----- --------- --------- -------- Trade Payables (70) (47) (37) (195) (349) Accrued content costs (35) (16) (243) (383) (677) Other accrued liabilities (57) 108 (17) (443) (409) Other payables - (10) - (150) (160) Corporate income tax payable - - - (997) (997) TOTAL LIABILITIES (162) 35 (297) (2,168) (2,592) ============================= ======= ===== ========= ========= ======== 3. EARNINGS PER SHARE Earnings per share Earnings per share is calculated by dividing the(loss)/profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. Unaudited Unaudited Audited 6 months 6 months 12 months ended 31 ended 31 ended 30 December December June 2016 2016 2015 Loss for the period (GBP000's) (879) (321) -1,306 ----------- ----------- ------------ Loss earnings per share (pence): Basic (2,167) (0,865) (3,519) Diluted (2,167) (0,865) (3,519) Adjusted earnings per share Adjusted earnings per share is calculated to reflect the underlying profitability of the business by excluding non-cash charges for depreciation, amortisation, impairments and share compensation charges. 6 months 6 months 12 months ended 31 ended 31 ended 30 December December June 2016 2016 2015 GBP000's GBP000's GBP000's Loss for the period (879) (321) -1,306 Add back: share compensation expense 97 44 146 Add back: depreciation and amortisation 14 27 59 Adjusted Loss for the period (768) (250) -1,101 Pence per Pence per Pence per share share share Adjusted loss per share (1.894) (0.674) (2.967) Adjusted diluted loss per share (1.894) (0.674) (2.967) Weighted average number of shares 6 months 6 months 12 months ended 31 ended 31 ended 30 December December June 2016 2016 2015 Basic 40,507,910 37,100,536 37,114,283 Exercisable share options - 2,330,960 - ----------- ----------- ------------ Diluted 40,507,910 39,431,496 37,114,283 ----------- ----------- ------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Diluted (loss)/earnings per share is calculated adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has only one category of ordinary shares.
The adjusted EPS has been calculated to reflect the underlying profitability of the business by excluding non-cash charges for depreciation, amortisation, impairments and share compensation charges.
4. GOING CONCERN
The Group had cash balances of GBP2.8m at 31 December 2016 (30 June 2016: GBP1.4m) and no borrowings. Having reviewed cash flow forecasts and budgets for a year ahead the Directors have a reasonable expectation that the Group has sufficient resources to continue in operational existence for the foreseeable future.
As at 31 December 2016, GBP0.7m (including short-term investments of GBP0.6m) of the Group's cash balance was held in Argentina. The Argentine Government has released the currency restrictions in December 2015. Since then, the Peso has remained relatively stable, although we cannot predict future movements in the currency and the impact on our financial performance.
5. FOREIGN CURRENCY TRANSLATION
(a) Presentational currency
The consolidated financial statements are presented in British pounds: the functional currency of the parent entity is also British pounds.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date the transaction occurs. Any exchange gains or losses resulting from these transactions and from the translation of monetary assets and liabilities at the balance sheet date are reported in the income statement except when these represent a net investment in a subsidiary when they are charged or credited to equity
.
Foreign currency balances are translated at the balance sheet date using exchange rates prevailing at the period end.
(c) Group companies
The financial results and position of all group entities that have a functional currency different from the presentational currency of the Group are translated into the presentational currency as follows:
i- assets and liabilities for each balance sheet are translated at the closing exchange rate at the date of the balance sheet
ii - income and expenses for each income statement are translated at average exchange rates (unless it is not a reasonable approximation to the exchange rate at the date of transaction)
iii- all resulting exchange differences are recognised as a separate component of equity (translation reserve)
The exchange rates used in respect of Argentinean pesos are the official published exchange rates.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BUGDXIDXBGRG
(END) Dow Jones Newswires
March 31, 2017 02:00 ET (06:00 GMT)
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