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Share Name Share Symbol Market Type Share ISIN Share Description
Mirriad Advertising Plc LSE:MIRI London Ordinary Share GB00BF52QY14 ORD GBP0.00001
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -7.00 -16.67% 35.00 33.00 35.00 37.50 33.50 37.50 2,159,931 16:45:43
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Media 2.2 -9.1 -4.0 - 98

Mirriad Advertising PLC Results for the year ended 31 December 2020

12/05/2021 7:00am

UK Regulatory (RNS & others)


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TIDMMIRI

RNS Number : 2918Y

Mirriad Advertising PLC

12 May 2021

12 May 2021

Mirriad Advertising plc

("Mirriad" or the "Company")

Results for the year ended 31 December 2020

Mirriad, the leading in-content advertising company, announces its audited results for the year ended 31 December 2020.

Financial overview

   --    2020 revenue up 91% to GBP2.18m (2019: GBP1.14m) 
   --    Operating loss reduced by 25% to GBP9.09m (2019: GBP12.17m) 
   --    Cash consumption down 27% to GBP8.06m (2019: GBP11.01m) 
   --    Net assets at 31 December 2020 up 84% GBP35.3m (2019: GBP19.2m) 
   --    Cash and cash equivalents at 31 December 2020 up 85% to GBP35.4m (2019: GBP19.1 million) 

Operational highlights

   --    Broadcast and digital distributor supply partners under contract up 33% to 20 (2019: 15) 
   --    Framework agreement signed with Tier One US entertainment giant in October 2020 
   --    Launched Music Alliance with globally renowned record labels and independent music companies 
   --    Achieved an OTCQB cross listing in September 2020, under ticker symbol "MMDDF" 

-- Executed an oversubscribed Placing and Open Offer, raising GBP26.2 million (gross) in December 2020, positioning the business for future growth

Post period highlights

-- Framework agreement reached with one of the world's leading food and beverage companies to incentivise spend on in-video campaigns in the US market.

-- Commercial negotiations complete to replace the expired contract with Tencent Video and detailed contractual terms are now being discussed

   --    Appointment of new CTO in February 2021 and new CRO in May 2021 
   --    Appointment of Kelsey Lynn Skinner as non-executive director in February 2021 

-- Boosted US sales capabilities with the appointment of an additional senior sales manager and an outsourced sales enablement company in February 2021

   --    Upgraded to OTCQX listing in the US in April 2021 

Stephan Beringer, CEO of Mirriad, said: "In 2020 we provided operational stability during a challenging period, with adverse effects of the Covid-19 pandemic affecting the wider advertising and content industries. We have been able to reduce our own costs through prudent management and also drive additional revenue, underlining our commitment to building long-term shareholder value.

" Mirriad is now well placed to benefit from the expected advertising sector recovery in the second half of this year. Thanks to our technology's ability to create new revenue opportunities whilst addressing established consumer aversion to interruptive advertising, we can offer more in-content opportunities to a rising number of advertisers and agencies, showing a clear pathway to scale in 2021 and beyond.

"The industry increasingly recognises the fantastic results our format delivers as we further develop the protected Mirriad technology that will ultimately define the in-content advertising space. With these factors considered, we are confident about the future growth of our proposition and business."

S

For further information please visit www.mirriad.com or contact:

 
 Mirriad Advertising plc              Tel: +44 (0)207 884 2530 
  Stephan Beringer, Chief Executive 
  Officer 
  David Dorans, Chief Financial 
  Officer 
 Nominated Adviser & Broker:          Tel: +44 (0)20 7523 8000 
  Canaccord Genuity Limited 
  Simon Bridges 
  Richard Andrews 
  Thomas Diehl 
 Financial Communications: 
  Charlotte Street Partners 
  Tom Gillingham                        Tel: +44 (0) 7741 659021 
  Andrew Wilson                         Tel: +44 (0) 7810 636995 
 

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

Notes to Editors

About Mirriad

Mirriad's award-winning solution unleashes new revenue for content producers and distributors by creating new advertising inventory in content. Our patented, AI and computer vision technology dynamically inserts products and innovative signage formats after content is produced. Mirriad's market-first solution seamlessly integrates with existing subscription and advertising models, and dramatically improves the viewer experience by limiting commercial interruptions.

Mirriad currently operates in the US, Europe and China.

Forward looking statements

Certain information contained in this announcement, including any information as to the Group's strategy, plans or future financial or operating performance, constitutes "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "projects", "expects", "intends", "aims", "plans", "predicts", "may", "will", "seeks" "could" "targets" "assumes" "positioned" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this announcement and include statements regarding the intentions, beliefs or current expectations of the Directors concerning, among other things, the Group's results of operations, financial condition, prospects, growth, strategies and the industries in which the Group operates. The directors of the Company believe that the expectations reflected in these statements are reasonable, but may be affected by a number of variables which could cause actual results or trends to differ materially. Each forward-looking statement speaks only as of the date of the particular statement.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future or are beyond the Group's control. Forward-looking statements are not guarantees of future performance. Even if the Group's actual results of operations, financial condition and the development of the industries in which the Group operates are consistent with the forward-looking statements contained in this document, those results or developments may not be indicative of results or developments in subsequent periods.

Chairman's statement

Last year, I said that the priority for 2020 would be converting positive sentiment towards Mirriad into tangible engagement.

Despite the disrupting influence of the COVID-19 pandemic, I am delighted with the progress that has been made against this central ambition.

Continuing confidence from investors and shareholders has allowed Mirriad to become the market leader in in-content. advertising, but there is - of course - more work to be done.

The signing of a new framework agreement with a tier one US entertainment giant in October was a major milestone for the Company, a validation of our technology and a demonstration of how far we have come after resetting the Company in 2019.

This was followed by the announcement of the Mirriad Music Alliance, a partnership with globally renowned record labels and leading independent music companies to bring brands immediate access to millions of consumers through over a thousand global artists.

Both announcements demonstrate the flexibility of Mirriad's technology and its ability to adapt with ease to reach into new growth markets. The team is excited about the potential of the music sector in particular for 2021.

Over the summer we saw an increasing level of activity in China via our partner Tencent. This demonstrates how effective Mirriad can be when it is integrated with a partner's systems, and this offers a blueprint of how we can drive real scale in the future.

The year closed with a heavily oversubscribed fundraising round, offering another indication of the enthusiasm for the Mirriad solution amongst existing and new investors. The money raised gives us the resources required to drive further scale.

The ongoing backdrop of a global pandemic makes all of these achievements all the more significant, and I would like to pay tribute to the hard work across the business that has made all of this possible.

Engaging with our stakeholders

The Board, Stephan and I take our responsibilities to shareholders and wider stakeholders seriously. In line with pandemic restrictions, face-to-face events other than our technology showcase in January 2020 have been limited, but we have continued our engagement through digital platforms.

The management team is also actively engaged with broadcasters and digital content platforms, advertising agencies and senior international advertisers.

As well as undertaking many virtual meetings over the course of the year, we have sought to maintain exceptional standards of communication around significant events by offering our stakeholders opportunities to join webinars presented by the management team.

The Company has continued to demonstrate its resilience in the COVID-19 environment with all staff working effectively from home or in line with local restrictions. In this environment, engagement is more critical than ever and Mirriad actively communicates with its employees via regular staff surveys and monthly virtual Town Hall meetings.

The year ahead

The focus for the year ahead will be building Mirriad as the media solution for a new era in audience engagement. This will be achieved by stimulating direct demand and putting in place the sales architecture and data capability to scale within this competitive market.

While the macroeconomic outlook is still uncertain, our recent activity has given me confidence that the Mirriad solution is well positioned to respond to changing viewing habits and to provide value in what is a growing addressable market. The fundamental fact that audiences prefer the Mirriad format to other more disruptive advertising types, and the fact that it is proven to drive increased brand consideration, gives us a compelling competitive advantage at a time when broadcasters, content creators and distributors are all looking for new sources of revenue.

John Pearson

Non-executive chairman

12 May 2021

CEO's statement

Much of last year's focus was on taking the Mirriad story to external audiences in the market and building momentum for the new advertising format after our strategic reset. Following a successful fundraise and increasing our profile, we will now focus our efforts on creating a Mirriad architecture that will ultimately build and define the in-content advertising space.

COVID-19 related filming and travel restrictions have added to the ongoing upheaval of the advertising ecosystem, and with inventory at a premium, Mirriad is well placed to benefit from the steady increase in streaming and sustained consumer aversion to interruptive advertising. We are confident that our in-content solution marks a step change from established advertising formats, giving producers, advertisers and content creators a bold and sustainable new format to drive engagement.

Increased demand and momentum

We have worked hard to increase momentum through engagement with senior stakeholders at advertising clients, agency groups as well as the linear and digital content platforms and companies, and now the time is right to renew our focus on three key areas for 2021.

Firstly our technology and platform will be at the heart of everything we do in the year ahead - it is vital we press on and further refine our infrastructure to allow it to be effectively 'plugged' into our partners' platforms and the entire ad buying and delivery ecosystem.

Secondly, to support this drive for scale, we will further ramp up automation. Improved automation will transform the scale, precision and speed at which Mirriad and our partners look at and plan inventory; decide on the insertion opportunities; process in-content ads, eventually in multiple variations; and track delivery and results for the purpose of optimisation.

This is particularly true for our expansion into the music sector and other content areas where Mirriad is in charge of the inventory transaction. New levels of data intelligence, automation and integration will be the pivot into a scaled media proposition. We have a great technical team that we are supplementing with strategic hires. The addition of an experienced new CTO, Philip Mattimoe, at the start of this year is the latest piece in our technology jigsaw.

US sales

Finally, we must drive more sales in the US in particular. We have added to our US sales capability and this will improve our ability to stimulate direct demand. Alongside this, we will continue to seek opportunities in sectors like music to realise growth potential in our expanding addressable markets.

Our technology is patent-protected and industry-defining. With strong fundamentals now in place, I look forward to sharing more detailed updates in this area throughout, what I believe will be, another exciting year for Mirriad. The advertising and media industries are going through times of profound change. From the shift to more streaming services to the sunsetting of the cookie, engaging with consumers needs a new approach and formula. In-content advertising and contextual targeting are the keys to a new era, and the continuous improvements in our protected and awarded technology, as well as the integration with the ecosystem, will ultimately drive the mass adoption of the new format that Mirriad is leading with.

Stephan Beringer

Chief Executive Officer

12 May 2021

Financial review

Introduction

Figures published by Zenith suggest that Worldwide advertising expenditure declined by 9.1% in 2020 with declines experienced in all of Mirriad's operating markets as Covid-19 impacted the global content and advertising business. In contrast 2020 saw Mirriad achieve our highest ever revenue despite the impact of Covid-19. The Company completed a successful fundraising of GBP26.2 million (gross) at the end of December 2020 which gives us the financial resources to continue to invest in our technology and building our sales capability, particularly in the US. All three of the Company's KPIs improved substantially over the year with revenues up 91.3%, cash consumption down by 26.6% and customers under contract up by 33.3%.

Current year results

Revenue for the year was almost double the prior year at GBP2.18 million (2019: GBP1.14 million) largely based on the revenue guaranteed in the Tencent contract. During the year the Group continued to focus on developing its operations in the US, the world's largest advertising market, and Europe. In the US, we announced a deal with a major tier one entertainment giant in the final quarter and ran the first campaign for that partner in December. This deal adds to the existing supply partner relationships in the US with Univision, Condé Nast and Tastemade. We also concluded a new deal with A&E Networks in the US shortly before the year end having added deals with Meredith and Fuse Media earlier in 2020. In Europe, we focussed on France where the Company continues to work with the major broadcasters and we ran a number of campaigns for France Televisions. As in previous years we caution that sales cycles with large broadcasters and distributors are long and therefore it will take time to scale revenues.

Revenue was particularly strong in China based on our exclusive deal with Tencent video announced in July 2019. This deal expired in March 2021 and some of the revenue under the contract was deferred from 2020 into 2021 as Covid impacted the volume of campaigns booked during 2020.

As a result of the increased level of revenue gross margin increased to GBP1.94 million (2019: GBP0.96 million). As noted in previous years the Company is making steady progress in automating key elements of its production process and our teams work with our technology to deliver campaigns. The vast majority of our Cost of Sales relates to our staff based in Mumbai. The staff element of this work is largely fixed at current volumes which means that margin is impacted by the throughput of work and has the potential to improve significantly as these volumes increase.

The Group's principal cost is staff. We previously reported that we had undertaken a significant volume of restructuring in 2019 and the impact of these changes have now fed through to our income statement. Over the course of 2020 administrative expenses decreased to GBP11.22 million (2019: GBP13.16 million). The Company took the decision not to furlough or put any staff on short working during the year to allow us to maintain momentum and continue our commitment to expanding scale.

The Company has continued to review and monitor the application of IAS 38 with respect to the capitalisation of development cost. The Company has continued to take the view that due to the uncertainty of future revenue generation it will not capitalise any development cost in 2020 even though technology remains key to the Company's business and internally generated software and IP remains a key focus for future development of the business. Accordingly, the income statement includes GBP2.43 million (2019: GBP2.32 million) related to research and development ("R&D") activity. In total expenditure on the Company's technology team increased by GBP0.12 million as average headcount was modestly increased.

The reduction in operating costs and improvement in gross margin fed through to EBITDA with the EBITDA loss decreasing to GBP8.63 million (2019: GBP11.51 million). Likewise, the loss for the year before tax decreased to GBP9.09 million (2019: GBP12.15 million).

Tax

The Group has not recognised any tax assets in respect of trading losses arising in the current financial year or accumulated losses in previous financial years. The tax credit recognised in the current and previous financial years arises from the receipt of R&D tax credits.

Earnings per share

Loss per share was 4p per share (2019: loss of 8p per share) as a result of the reduction in operating costs over the year and the increase in the Company's issued share capital. This calculation is based on the weighted average number of shares in issue during the financial year.

Dividend

No dividend has been proposed for the year ended 31 December 2020 (2019: GBPnil).

Cash flow

Net cash used in operations was GBP8.06 million (2019: GBP10.95 million) as the benefits of the Group's restructuring flowed through to cash. The Group incurred GBP25,202 (2019: GBP62,484) of capital expenditure on tangible assets in the year. Net proceeds from the issue of shares in December 2020 totalled GBP24.78 million (2019: GBP15.29 million) following the successful fundraising.

Balance sheet

Net assets increased to GBP35.3 million (2019: GBP19.2 million) as a result of the proceeds from the issue of shares net of the losses for the year. Cash and cash equivalents at 31 December 2020 were GBP35.4 million (2019: GBP19.1 million).

Accounting policies

The Group's consolidated financial information has been prepared in accordance with International Financial Reporting Standards in conformity with the requirements of the Companies Act 2006.

Going concern

The financial statements have been prepared on a going concern basis. This is supported by the Company's successful fundraise in December 2020, where an additional GBP26.2m (gross) proceeds were raised, the substantial cash balance of GBP35.42m at the year end, the fact that the Company is debt free with no external borrowing and the Company's net cash outflow of GBP8.06m for 2020. After making enquiries and producing cash flow forecasts in a variety of scenarios, the Directors have reasonable expectations, as at the date of approving the financial statements, that the Company and the Group will have adequate resources to fund the activities of the Company and the Group for the next 12 months from the date of the financial statements.

David Dorans

Chief Financial Officer

12 May 2020

Consolidated statement of profit or loss

For the year ended 31 December 2020

 
                                          Year ended    Year ended 
                                         31 December   31 December 
                                                2020          2019 
                                  Note           GBP           GBP 
--------------------------------  ----  ------------  ------------ 
Revenue                              3     2,179,919     1,139,538 
Cost of sales                              (244,359)     (178,091) 
--------------------------------  ----  ------------  ------------ 
Gross profit                               1,935,560       961,447 
Administrative expenses                 (11,216,312)  (13,159,812) 
Other operating income                       188,306        24,421 
--------------------------------  ----  ------------  ------------ 
Operating loss                       4   (9,092,446)  (12,173,944) 
 
Finance income                                34,339        46,436 
Finance costs                               (30,702)      (23,627) 
--------------------------------  ----  ------------  ------------ 
Finance income - net                           3,637        22,809 
 
Loss before income tax                   (9,088,809)  (12,151,135) 
Income tax credit                             32,429        56,231 
--------------------------------  ----  ------------  ------------ 
Loss for the year                        (9,056,380)  (12,094,904) 
--------------------------------  ----  ------------  ------------ 
Loss per Ordinary Share - basic      5          (4p)          (8p) 
--------------------------------  ----  ------------  ------------ 
 
 

All activities are classified as continuing.

Consolidated statement of comprehensive income

For the year ended 31 December 2020

 
                                                             Year ended    Year ended 
                                                            31 December   31 December 
                                                                   2020          2019 
                                                                    GBP           GBP 
----------------------------------------------------------  -----------  ------------ 
Loss for the financial year                                 (9,056,380)  (12,094,904) 
----------------------------------------------------------  -----------  ------------ 
Other comprehensive (loss) / income 
Items that may be reclassified to profit or loss: 
Exchange differences on translation of foreign operations         (646)       136,179 
----------------------------------------------------------  -----------  ------------ 
Total comprehensive loss for the year                       (9,057,026)  (11,958,725) 
----------------------------------------------------------  -----------  ------------ 
 

Items in the statement above are disclosed net of tax.

Consolidated balance sheet

At 31 December 2020

 
                                       Group 
                                    ------------ 
                                           As at         As at 
                                     31 December   31 December 
                                            2020          2019 
                                             GBP           GBP 
---------------------------------   ------------  ------------ 
Assets 
Non-current assets 
Property, plant and equipment            636,543       912,983 
Intangible assets                              -             - 
Investments                                    -             - 
Trade and other receivables              186,021       212,143 
----------------------------------  ------------  ------------ 
                                         822,564     1,125,126 
 ---------------------------------  ------------  ------------ 
Current assets 
Trade and other receivables            1,475,785     1,024,996 
Other current assets                      72,993        76,754 
Cash and cash equivalents             35,421,396    19,091,613 
----------------------------------  ------------  ------------ 
                                      36,970,174    20,193,363 
 ---------------------------------  ------------  ------------ 
Total assets                          37,792,738    21,318,489 
----------------------------------  ------------  ------------ 
Liabilities 
Non-current liabilities 
Lease liabilities                        204,437       423,328 
----------------------------------  ------------  ------------ 
                                         204,437       423,328 
 ---------------------------------  ------------  ------------ 
Current liabilities 
Trade and other payables               1,913,845     1,297,624 
Current tax liabilities                   13,361        24,809 
Lease liabilities                        390,220       373,227 
----------------------------------  ------------  ------------ 
                                       2,317,426     1,695,660 
 ---------------------------------  ------------  ------------ 
Total liabilities                      2,521,863     2,118,988 
----------------------------------  ------------  ------------ 
Net assets                            35,270,875    19,199,501 
----------------------------------  ------------  ------------ 
Equity and liabilities 
Equity attributable to owners of 
 the parent 
Share capital                             52,688        52,029 
Share premium                         65,710,297    40,932,183 
Share-based payment reserve            2,850,571     2,500,944 
Retranslation reserve                  (143,298)     (142,652) 
Accumulated losses                  (33,199,383)  (24,143,003) 
----------------------------------  ------------  ------------ 
Total equity                          35,270,875    19,199,501 
----------------------------------  ------------  ------------ 
 
 

Consolidated statement of changes in equity

For the year ended 31 December 2020

 
                                                             Year ended 31 December 2019 
                                   ------------------------------------------------------------------------------- 
                                                            Share-based  Retranslation   Accumulated 
                                      Share                     payment 
                                    capital  Share premium      reserve        reserve        losses  Total equity 
                                        GBP            GBP          GBP            GBP           GBP           GBP 
--------------------------------   --------  -------------  -----------  -------------  ------------  ------------ 
Balance at 1 January 2019            50,949     25,643,192    2,141,094      (278,831)  (12,048,099)    15,508,305 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Loss for the financial 
 year                                     -              -            -              -  (12,094,904)  (12,094,904) 
Other comprehensive income 
 for the year                             -              -            -        136,179             -       136,179 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Total comprehensive loss 
 for the year                             -              -            -        136,179  (12,094,904)  (11,958,725) 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Proceeds from shares issued           1,080     16,196,750            -              -             -    16,197,830 
Share issue costs                         -      (907,759)            -              -             -     (907,759) 
Share-based payments recognised 
 as expense                               -              -      359,850              -             -       359,850 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Total transactions with 
 shareholders recognised 
 directly in equity                   1,080     15,288,991      359,850              -             -    15,649,921 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Balance at 31 December 
 2019                                52,029     40,932,183    2,500,944      (142,652)  (24,143,003)    19,199,501 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
 
 
                                                             Year ended 31 December 2020 
                                   ------------------------------------------------------------------------------- 
                                                                                            Retained 
                                                                                           earnings/ 
                                                            Share-based  Retranslation  (accumulated 
                                      Share                     payment 
                                    capital  Share premium      reserve        reserve       losses)  Total equity 
                                        GBP            GBP          GBP            GBP           GBP           GBP 
--------------------------------   --------  -------------  -----------  -------------  ------------  ------------ 
Balance at 1 January 2020            52,029     40,932,183    2,500,944      (142,652)  (24,143,003)    19,199,501 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Loss for the financial 
 year                                     -              -            -              -   (9,056,380)   (9,056,380) 
Other comprehensive loss 
 for the year                             -              -            -          (646)             -         (646) 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Total comprehensive loss 
 for the year                             -              -            -          (646)   (9,056,380)   (9,057,026) 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Proceeds from shares issued             659     26,228,815            -              -             -    26,229,474 
Share issue costs                         -    (1,450,701)            -              -             -   (1,450,701) 
Share-based payments recognised 
 as expense                               -              -      349,627              -             -       349,627 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Total transactions with 
 shareholders recognised 
 directly in equity                     659     24,778,114      349,627              -             -    25,128,400 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
Balance at 31 December 
 2020                                52,688     65,710,297    2,850,571      (143,298)  (33,199,383)    35,270,875 
---------------------------------  --------  -------------  -----------  -------------  ------------  ------------ 
 

Consolidated statement of cash flows

For the year ended 31 December 2020

 
                                                   Group 
                                         ------------------------- 
                                                2020          2019 
                                                 GBP           GBP 
--------------------------------------   -----------  ------------ 
Cash used in operations                  (8,146,368)  (11,222,098) 
Tax credit received                           99,886       291,502 
Taxation paid                               (17,697)      (43,288) 
Interest received                             34,339        46,436 
Lease interest paid                         (30,702)      (23,627) 
---------------------------------------  -----------  ------------ 
Net cash used in operating activities    (8,060,542)  (10,951,075) 
---------------------------------------  -----------  ------------ 
Cash flow from investing activities 
Purchase of tangible assets                 (25,202)      (62,484) 
Proceeds from disposal of tangible 
 assets                                          100           236 
---------------------------------------  -----------  ------------ 
Net cash used in investing activities       (25,102)      (62,248) 
---------------------------------------  -----------  ------------ 
Cash flow from financing activities 
Proceeds from issue of Ordinary 
 Share capital 
 (net of costs of issue)                  24,778,773    15,290,071 
Payment of lease liabilities               (363,346)     (389,055) 
---------------------------------------  -----------  ------------ 
Net cash generated from financing 
 activities                               24,415,427    14,901,016 
---------------------------------------  -----------  ------------ 
Net increase in cash and cash 
 equivalents                              16,329,783     3,887,693 
Cash and cash equivalents at 
 the beginning of the year                19,091,613    15,203,920 
---------------------------------------  -----------  ------------ 
Cash and cash equivalents at 
 the end of the year                      35,421,396    19,091,613 
---------------------------------------  -----------  ------------ 
Cash and cash equivalents consists 
 of 
Cash at bank and in hand                  35,421,396    19,091,613 
---------------------------------------  -----------  ------------ 
Cash and cash equivalents                 35,421,396    19,091,613 
---------------------------------------  -----------  ------------ 
 

Notes to the consolidated financial statements

For the year ended 31 December 2020

1. Corporate Information

Mirriad Advertising plc is a public limited company incorporated and domiciled in the UK and registered in England with company registration number 09550311. The Company's registered office is 6th Floor, One London Wall, London, EC2Y 5EB.

2. Basis of preparation

The financial information set out above does not constitute the Group's statutory accounts for the years ended 31 December 2020 or 2019 but is derived from those accounts. Statutory accounts for 2019 have been delivered to the registrar of companies, and those for 2020 will be delivered in due course. The auditor has reported on those accounts; their reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

The consolidated financial information has been prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee ("IFRS IC") interpretations in conformity with the requirements of the Companies Act 2006 applicable to companies reporting under IFRS,

The financial information contained in these financial statements have been prepared under the historical cost convention, and on a going concern basis.

The accounting policies applied are consistent with those of the annual report and accounts for the year ended 31 December

2019.

(a) New standards, amendments and interpretations

The Group has applied the following standards and amendments for the first time for the annual reporting period commencing 1 January 2020:

   --     Definition of material - Amendments to IAS 1 and IAS 8; 
   --     Definition of a Business - Amendments to IFRS 3; 
   --     Interest Rate Benchmark Reform - Amendments to IFRS 7, IFRS 9 and IAS 39; 
   --     Revised Conceptual Framework for Financial Reporting; 

The new standards listed above did not have any material impact on the amounts recognised in the current period and are not expected to significantly affect future periods.

(b) New standards, amendments and interpretations not yet adopted

A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2021, and have not been applied in preparing these financial statements. These standards are not expected to have a material impact on the entity in the current or future reporting periods or on foreseeable future transactions.

3. Segment information

Management mainly considers the business from a geographic perspective since the same services are effectively being sold in every Group entity. Therefore regions considered for segmental reporting are where the Company and subsidiaries are based, namely the UK, the USA, India, and China. The Singapore office was closed in early 2020. The revenue is classified by where the sales were booked not by the geographic location of the customer. For this reporting purpose the Singapore and China entities are considered together.

The only income outside of the primary business activity relates to income received from grants which is recognised in other operating income.

The amount of revenue from external customers by location of the Group billing entity is shown in the tables below.

 
                             2020       2019 
Revenue                       GBP        GBP 
----------------------  ---------  --------- 
Turnover by geography 
China and Singapore     1,765,196    776,115 
USA                       313,967    160,432 
UK                        100,756    139,735 
India                           -     38,549 
Brazil                          -     24,707 
----------------------  ---------  --------- 
Total                   2,179,919  1,139,538 
----------------------  ---------  --------- 
 
 
                             2020       2019 
                              GBP        GBP 
----------------------  ---------  --------- 
Turnover by category 
Rendering of services   2,179,919  1,139,538 
----------------------  ---------  --------- 
Total                   2,179,919  1,139,538 
----------------------  ---------  --------- 
 
 
                                                          2020       2019 
Revenues from external customers by country, based 
 on the destination of the customer                        GBP        GBP 
---------------------------------------------------  ---------  --------- 
China                                                1,780,905    834,887 
USA                                                    313,967    160,432 
France                                                  31,559      9,633 
Turkey                                                  22,010          - 
UK                                                      21,700     56,500 
India                                                        -     38,549 
Brazil                                                       -     24,707 
Ireland                                                      -      7,750 
Germany                                                      -      7,080 
Other                                                    9,778          - 
---------------------------------------------------  ---------  --------- 
Total                                                2,179,919  1,139,538 
---------------------------------------------------  ---------  --------- 
 

4. Operating loss

The Group operating loss is stated after charging/(crediting):

 
                                                          2020        2019 
                                                           GBP         GBP 
-------------------------------------------------   ----------  ---------- 
Employee benefits                                    7,559,195   8,123,117 
Depreciation of property, plant and equipment          466,097     498,411 
Amortisation and impairment of intangible assets             -     170,053 
Foreign exchange movements                              28,040     168,319 
Other general and administrative costs               3,407,339   4,378,003 
Other operating income                               (188,306)    (24,421) 
--------------------------------------------------  ----------  ---------- 
Total cost of sales, administrative expenses 
 and other operating income                         11,272,365  13,313,482 
--------------------------------------------------  ----------  ---------- 
 

Other operating income includes income received from government grants and Research and development expenditure credits. The Group has complied with all the conditions attached to these grant awards.

Included within Employee benefits costs are share based payments for the year ended 31 December 2020 of GBP0.4m (2019: GBP0.4m).

5. Loss per share

(a) Basic

Basic loss per share is calculated by dividing the loss for the year by the weighted average number of Ordinary Shares in issue during the year. Potential Ordinary Shares are not treated as dilutive as the Group is loss making and such shares would be anti-dilutive.

 
Group                                                        2020          2019 
----------------------------------------------------  -----------  ------------ 
Loss attributable to owners of the parent (GBP)       (9,056,380)  (12,094,904) 
Weighted average number of Ordinary Shares in issue 
 (number)                                             215,687,030   150,165,094 
----------------------------------------------------  -----------  ------------ 
 

The loss per share for the year was 4p (2019: 8p).

No dividends were paid during the year (2018: GBPnil).

(b) Diluted

Potential Ordinary Shares are not treated as dilutive as the Group is loss making and such shares would be anti-dilutive.

6. Related party transactions

The Group is owned by a number of investors, the largest being M&G Investment Management which owns approximately 13% of the share capital of the Company. At 31 December 2019 the largest shareholder was IP2IPO Portfolio (GP) Limited (as general partner for IP2IPO Portfolio LP) which owned approximately 16% of the share capital of the Company. Accordingly there is no ultimate controlling party.

During the year the Company had the following significant related party transactions which were carried out at arm's length. No guarantees were given or received for any of these transactions:

Transactions with Directors

As part of the fundraise in December 2020 the following Directors purchased Ordinary Shares in the Company at a cost of GBP0.40 per share:

 
                       Number 
Director            of shares 
-----------------  ---------- 
John Pearson           25,000 
Stephan Beringer       25,000 
David Dorans            2,500 
Alastair Kilgour       25,000 
Bob Head               50,000 
-----------------  ---------- 
 

Transactions with other related parties

IP2IPO Limited - a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder in the Group, and which also appoints a Director of the Group charged Mirriad Advertising plc for the following transactions during the year: (1) GBP20,000 for the services of Dr Mark Reilly as a Director during the year. GBP1,667 of this amount was invoiced and unpaid as at 31 December 2020. These outstanding amounts were paid on 5 February 2021; (2) GBP12,000 for the services of the Company Secretary during the year. GBP3,000 of this amount was invoiced and unpaid as at 31 December 2020. This outstanding amount was paid on 5 February 2021; and (3) GBP250 for travel costs related to Dr Mark Reilly. GBP22 of this amount was invoiced and unpaid as at 31 December 2020, and was paid on 5 February 2021.

Parkwalk Advisors Limited - a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder in the Group, charged Mirriad Advertising plc for the following transactions during the year: (1) GBP20,000 for the services of Alastair Kilgour as a Director during the year. GBP1,667 of this amount was accrued and unpaid as at 31 December 2020, but was invoiced in early January 2021 and subsequently paid on 5 February 2021.

Top Technology Ventures Limited - a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder in the Group. There were no transactions with Mirriad Advertising plc during the year (2019: GBP9,498 for attendance and travel costs for an employee's attendance at IP Group events in China).

All the related party transactions disclosed above were settled by 31 December 2020 except where stated.

During the year ended 31 December 2020, the Company entered into transactions with its subsidiary companies for working capital purposes, which net off on consolidation - these have not been shown above.

The Directors have authority and responsibility for planning, directing and controlling the activities of the Group and they therefore comprise key management personnel as defined by IAS 24 "Related party disclosures". Remuneration of Directors and senior management is disclosed in the Remuneration Report.

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END

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May 12, 2021 02:00 ET (06:00 GMT)

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