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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
  0.0025 0.96% 0.2625 0.255 0.27 0.2625 0.255 0.26 64,728,246 15:03:20
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Mobile Telecommunications 0.4 -1.0 -0.1 - 9

Mobile Streams plc Half-year Report

29/03/2019 7:00am

UK Regulatory (RNS & others)


Mobile Streams (LSE:MOS)
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TIDMMOS

RNS Number : 3988U

Mobile Streams plc

29 March 2019

29 March 2019

Mobile Streams plc ("Mobile Streams" or the "Company") (AIM: MOS)

Interim Results

Mobile Streams announces its unaudited interim results for the six months ended 31 December 2018.

Highlights

-- Unaudited revenues were GBP0.9m (31 December 2017: GBP1.83m). All revenue is from continuing operations.

-- GBP0.55m of cash and cash equivalents at 31 December 2018 (GBP1.46m as at 31 December 2017), with no debt.

Post-period end update

-- GBP0.29m of cash and cash equivalents as at 20 March 2019, with no debt. The cash balance includes GBP0.13m of net funds raised via the subscription which was announced on 27 February 2019.

-- The Company is currently working with some of the largest carriers in the India market: Vodafone-Idea, Jio and BSNL.

Commenting, Simon Buckingham, CEO of Mobile Streams said: "Progress in India remained steady over the recent period as the market settles in response to the consolidation amongst the mobile telecom operators. Since tighter marketing regulations were imposed, revenue targets have continued to be impacted. Looking ahead to the rest of 2019, we anticipate increased performance from our relationship with the newest entrant to the Indian telecom market, however, investment is on hold with Airtel, our leading partner. In Argentina, trading has been steady in 2019, whilst operations in Indonesia have been delayed until the latter half of the calendar year."

India

The majority of revenue in India during the period, was generated from our HTML5 games service, mobilegaming.com, through our billing relationship with Airtel, one of the leading mobile operators in the country. These operations are currently on hold.

Airtel was recently usurped as the largest network by the Vodafone - Idea merger. Vodafone and Idea remain as individual entities with regards to our relationship with them, this development has prevented us increasing our business with these parties.

Argentina

Trading in Argentina remained stable with a small decline during the period. We continue with Movistar subscribers acquired via Google AdWords at declining volumes.

OPERATING REVIEW

During the period, both the Group's Mobile Internet revenues and its Mobile Operator revenues decreased. This was primarily due to increased regulation in the Indian telecom market. Devaluation of both the Argentine Peso and Indian Rupee against the British Pound was an additional factor in this decrease. On a like-for-like basis, revenues from Argentina during the period were ARS$20.8m (6 months ended 31 December 2017: ARS$38.8m) with India generating revenue of INR$38.8m (6 months ended 31 December 2017: INR$ 28.1m).

Mobile internet

Mobile Streams' performance during the six months ended 31 December 2018 was driven primarily from its Mobile Internet sales in India. During the period, Mobile Streams has continued with its strategy to develop a content offering direct to consumers across a wide range of mobile devices.

Mobile operator sales

Despite the recent signing of an agreement in India, with the third largest telecom operator Jio, this revenue stream has significantly reduced as consumer preference has moved from the operator branded stores to other third party channels such as iTunes, Google Play and our own service mobilegaming.com

FINANCIAL REVIEW

Group revenue for the six months ended 31 December 2018 was GBP0.92m, a decrease of 50% to the comparative period's figure of GBP1.83m. The gross profit was GBP0.41m which decreased by 39% during the period (2017: GBP0.67m). The gross profit margin increased from 36.7% to 44.2% as a result of decreased marketing (direct to consumer) costs related to the Mobile Internet division.

The Group recorded a loss after tax of GBP317k for the 6 months ended 31 December 2018 (2017: loss GBP587k), generating a loss per share of 0.32 pence per share (2017: 0.64 pence loss per share).

Adjusted loss per share (excluding depreciation, amortisation, impairments and share compensation expense) was 0.32 pence per share (2017: 0.63 pence adjusted loss per share).

Cash and cash equivalents

During the period, the Argentine Peso depreciated by approximately 22% against the British Pound. Current cash balances (as at 20 March 2019) are GBP 0.29m.

OUTLOOK

The Directors have some reservations about the short term opportunities in India given the current developments amongst the telecom operators and increased regulations. Management's strategy is to offset revenue decline in India by expanding operations into Indonesia. It is expected that trading conditions in Argentina will remain consistent and therefore revenues in the second half of the financial year will be lower than originally expected.

 
 CONSOLIDATED INCOME STATEMENT 
 
                                                   Unaudited                 Unaudited                    Audited 
                                                    6 months                  6 months                  12 months 
                                                    ended 31                  ended 31                   ended 30 
                                                    December                  December                       June 
                                                        2018                      2017                       2018 
                                                    GBP000's                  GBP000's                   GBP000's 
 
 Revenue                                                 919                     1,833                      3,046 
 Cost of sales                                         (513)                   (1,162)                    (1,868) 
-------------------------------------  ---------------------  ------------------------  ------------------------- 
 Gross profit                                            406                       671                      1,178 
 Selling and marketing costs                           (198)                     (440)                      (638) 
 Administrative expenses **                            (570)                     (879)                    (1,724) 
 Operating Loss                                        (362)                     (648)                    (1,184) 
 
 Finance income                                           63                        82                        255 
 Finance expense                                           -                       (2)                        (2) 
                                       ---------------------  ------------------------  ------------------------- 
 Loss before tax                                       (299)                     (568)                      (931) 
 
 Tax expense                                            (18)                      (19)                       (84) 
 Loss for the period                                   (317)                     (587)                    (1,015) 
=====================================  =====================  ========================  ========================= 
 
 Attributable to: 
 Attributable to equity shareholders 
  of Mobile Streams Plc                                (317)                     (587)                    (1,015) 
=====================================  =====================  ========================  ========================= 
 
 
 Earning Per Share 
                                                   Pence per                 Pence per                  Pence per 
                                                       share                     share                      share 
 Basic loss per share                                (0.324)                   (0.641)                    (1.007) 
 Diluted loss per share                              (0.324)                   (0.641)                    (1.007) 
 
 * *Administrative expenses include depreciation, amortisation, 
  impairment and share based compensation. 
 

CONSOLIDATED STATEMENT OF COMPRENHENSIVE LOSS

 
                                                        Unaudited                 Unaudited                    Audited 
                                                   6 months ended                  6 months                  12 months 
                                                      31 December                  ended 31              ended 30 June 
                                                                                   December 
                                                             2018                      2017                       2018 
 
                                                         GBP000's                  GBP000's                   GBP000's 
 
 Loss for the period                                        (317)                     (587)                    (1,015) 
 
 Exchange differences on translating 
  foreign operations                                        (168)                     (145)                      (533) 
 
 Total comprehensive loss for 
  the period                                                (485)                     (732)                    (1,548) 
=====================================  ==========================  ========================  ========================= 
 
 Total comprehensive loss for the period attributable 
  to: 
 
 Equity shareholders of Mobile 
  Streams Plc                                               (485)                     (732)                    (1,548) 
-------------------------------------  --------------------------  ------------------------  ------------------------- 
 
 
 CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
 
                                     Unaudited      Unaudited      Audited 
                                      6 months       6 months        12 months 
                                         ended          ended            ended 
                                   31 December    31 December          30 June 
                                          2018           2017             2018 
                                      GBP000's       GBP000's     GBP000's 
 Assets 
 Non- Current 
 Intangible assets                           -              -            - 
 Property, plant and equipment               4             12            7 
 Deferred tax asset                         74              -           74 
                                 -------------  -------------  -----------  ---- 
                                            78            167           81 
 Current 
 Trade and other receivables               852          1,261          904 
 Cash and cash equivalents                 554          1,466        1,039 
                                         1,406          2,727        1,943 
 
 Total assets                            1,484          2,894        2,024 
===============================  =============  =============  ===========  ==== 
 
 Equity 
 Equity attributable to equity holders of 
  Mobile Streams Plc 
 Called up share capital                   200            182          200 
 Share Premium                          12,550         12,463       12,550 
 Translation reserve                   (3,954)        (3,398)      (3,786) 
 Retained earnings                     (8,878)        (8,136)      (8,563) 
-------------------------------  -------------  ------------- 
 Total equity                             (82)          1,111          401 
-------------------------------  -------------  -------------  -----------  ---- 
 
 Liabilities 
 Current 
 Trade and other payables                1,384          1,516        1,410 
 Current tax liabilities                   182            267          213 
-------------------------------  -------------  -------------  -----------  ---- 
                                         1,566          1,783        1,623 
 
 Total liabilities                       1,566          1,783        1,623 
-------------------------------  -------------  -------------  -----------  ---- 
 
 Total equity and liabilities            1,484          2,894        2,024 
===============================  =============  =============  ===========  ==== 
 
 
 
 
 
 
   CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 
 
                                 Called        Share premium            Translation           Retained           Total 
                               up share                                     reserve           earnings          Equity 
                                capital 
 
                               GBP000's             GBP000's               GBP000's           GBP000's        GBP000's 
 
 Balance at 1 July 
  2017                              182               12,463                (3,253)            (7,552)           1,839 
 Credit for share 
  based payments                      -                    -                      -                  4               4 
 Transactions with 
  owners                              -                    -                      -                  4               4 
---------------------  ----------------  -------------------  ---------------------  -----------------  -------------- 
 Loss for the 6 
  months ended 
  31 December 2017                    -                    -                      -              (317)           (317) 
 Exchange differences 
  on translating 
  foreign operations                  -                    -                  (145)                  -           (145) 
 Total comprehensive 
  income for 
  the period                          -                    -                  (145)              (317)           (462) 
 Balance at 31 
  December 2017                     182               12,463                (3,398)            (7,865)           1,381 
---------------------  ----------------  -------------------  ---------------------  -----------------  -------------- 
 Balance at 1 January 
  2018                              182               12,463                (3,398)            (7,865)           1,381 
 New Equity                          18                   87                      -                  -             105 
 Credit for share 
  based payments                      -                    -                      -                  1               1 
 Transactions with 
  owners                             18                   87                      -                  1             106 
---------------------  ----------------  -------------------  ---------------------  -----------------  -------------- 
 Loss for the 6 
  months ended 
  30 June 2018                        -                    -                      -              (429)           (429) 
 Exchange differences 
  on translating 
  foreign operations                  -                    -                  (388)              (270)           (658) 
 Balance at 30 June 
  2018                              200               12,550                (3,786)            (8,563)             401 
---------------------  ----------------  -------------------  ---------------------  -----------------  -------------- 
 Balance at 1 July 
  2018                              200               12,550                (3,786)            (8,563)             401 
 Credit for share 
  based payments                      -                    -                      -                  3               3 
 Transactions with 
  owners                              -                    -                      -                  3               3 
---------------------  ----------------  -------------------  ---------------------  -----------------  -------------- 
 Loss for the 6 
  months ended 
  31 December 2018                    -                    -                      -              (317)           (317) 
 Exchange differences 
  on translating 
  foreign operations                  -                    -                  (168)                  -           (168) 
 Total comprehensive income for the 
  period                                                   -                  (168)              (317)           (485) 
 Balance at 31 
  December 2018                     200               12,550                (3,954)            (8,878)            (82) 
 

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 2018.

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 twelve months ended 30 June 2018 has been extracted from the statutory accounts for that period. In addition, the financial information for the 6 months ended 31 December 2018 has been extracted from the unaudited Interim results. The full audited accounts of the Group for the 12 months ended 30 June 2018 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 2018, the Group was organised into four 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 2018 were as follows: 
 GBP000's                      Europe   Asia Pacific      North      Latin   Group 
                                                        America    America 
 Mobile operator sales              1            (1)          6          -       6 
 Mobile internet sales              -            422          -        491     913 
 Other service fees                                -          -          - 
 Total Revenue                      1            421          6        491     919 
 Cost of sales                      -          (197)        (3)      (314)   (513) 
 Gross profit                       1            224          2        179     406 
 Operating expenses             (302)          (210)       (21)      (233)   (765) 
 EBITDA*                        (301)             13       (19)       (54)   (360) 
 Depreciation, amortisation         -                         -        (1)     (1) 
 Share based compensation         (3)              -          -          -     (3) 
 Finance income                     0                         -         63      63 
 Profit/(Loss) before tax       (303)             13       (18)          8   (300) 
 Income tax expense                 -              -          -       (17)    (17) 
 Profit/(Loss) after tax        (303)             13       (18)       (10)   (317) 
 
 
 The segmental results for the year ended 30 June 
  2018 were as follows: 
 GBP000's                     Europe              Asia Pacific                North                Latin                 Group 
                                                                            America              America 
 Mobile Operator 
  Services                         2                         1                   31                    -                    34 
 Mobile Internet 
  Services                         -                       543                    -                2,463                 3,006 
 Other Service 
  fees                             5                         -                    1                    -                     6 
----------------  ------------------  ------------------------  -------------------  -------------------  -------------------- 
 Total Revenue                     7                       544                   32                2,463                 3,046 
                                   0                         0                    0                    0 
 
 Cost of sales                   (2)                     (305)                 (15)              (1,546)               (1,868) 
----------------  ------------------  ------------------------  -------------------  -------------------  -------------------- 
 Gross profit                      5                       239                   17                  917                 1,178 
 Selling, 
  marketing and 
  administration 
  expenses                   (4,364)                       198                 (98)                1,913               (2,351) 
 
 Trading EBITDA*             (4,359)                       437                 (81)                2,830               (1,173) 
----------------  ------------------  ------------------------  -------------------  -------------------  -------------------- 
 Depreciation, 
  amortisation 
  and impairment                   -                         -                    -                  (6)                   (6) 
 Share based 
  compensation                   (5)                         -                    -                    -                   (5) 
 Finance income                    -                         -                    -                  255                   255 
 Finance expense                (39)                         -                   39                  (2)                   (2) 
----------------  ------------------  ------------------------  -------------------  -------------------  -------------------- 
 Loss before tax             (4,403)                       437                 (42)                3,077                 (931) 
 Taxation                          -                         -                    -                 (84)                  (84) 
 Loss after tax              (4,403)                       437                 (42)                2,993               (1,015) 
================  ==================  ========================  ===================  ===================  ==================== 
 
 
 
 The segmental results for the 6 months ended 31 December 
  2017 were as follows: 
 GBP000's                        Europe   Asia Pacific      North      Latin     Group 
                                                          America    America 
 Mobile operator sales                1              1         25          -        28 
 Mobile internet sales                -            329          -      1,471     1,800 
 Other service fees                   4              -          2          -         5 
 Total Revenue                        5            331         27      1,471     1,833 
 Cost of sales                      (1)          (220)       (13)      (929)   (1,162) 
------------------------------  -------  -------------  ---------  ---------  -------- 
 Gross profit                         4            111         13        543       671 
 Operating expenses               (540)          (251)       (38)      (484)   (1,314) 
 EBITDA*                          (537)          (140)       (25)         58     (643) 
 Depreciation, amortisation           -                         -        (3)       (3) 
 Share based compensation           (4)              -          -          -       (4) 
 Revenue/expense intercompany         0              -          -          -         0 
 Finance income                       0                         -         80        80 
 Profit/(Loss) before tax         (541)          (140)       (25)        135     (570) 
 Income tax expense                   -              -          -       (18)      (19) 
 Profit/(Loss) after tax          (541)          (140)       (25)        118     (588) 
 
 

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

 
 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 December                   ended 31                  ended 30 
                                                               2018                   December                 June 2018 
                                                                                          2017 
 
 Loss for the period (GBP000's)                               (317)                      (587)                    (1306) 
                                           ------------------------  -------------------------  ------------------------ 
 
 Loss earnings per share (pence): 
 Basic                                                      (0.324)                    (0.641)                   (3.519) 
 Diluted                                                    (0.324)                    (0.641)                   (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 December                   ended 31                  ended 30 
                                                               2018                   December                 June 2018 
                                                                                          2017 
                                                           GBP000's                   GBP000's                  GBP000's 
 
 Loss for the period                                          (317)                      (587)                    (1727) 
 Add back: share compensation expense                             3                          4                       118 
 Add back: depreciation and amortisation                          1                          3                        19 
 Adjusted Loss for the period                                 (312)                      (578)                    (1590) 
 
                                                          Pence per                  Pence per                 Pence per 
                                                              share                      share                     share 
 Adjusted loss per share                                    (0.320)                    (0.633)                   (2.414) 
 Adjusted diluted loss per share                            (0.320)                    (0.633)                   (2.414) 
 
 
 Weighted average number of shares 
 
                                                           6 months                   6 months                 12 months 
                                                  ended 31 December                   ended 31                  ended 30 
                                                               2018                   December                 June 2018 
                                                                                          2017 
 
 Basic                                                   97,992,286                 91,593,533                65,910,376 
 Exercisable share options                                        -                          -                         - 
                                           ------------------------  -------------------------  ------------------------ 
 Diluted                                                 97,992,286                 40,507,910                65,910,376 
                                           ------------------------  -------------------------  ------------------------ 
 

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 GBP0.55m at 31 December 2018 (30 June 2018: GBP1.04m) and no borrowings. Having reviewed cash flow forecasts and budgets for a year ahead the Directors have a reasonable expectation that the Group has resources to continue in operational existence for the foreseeable future. The Directors are analyzing further financing initiatives and a cost reduction program.

As at 31 December 2018, GBP0.45m (including short-term investments of GBP0.40m) 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 news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

IR LLFFTVSITFIA

(END) Dow Jones Newswires

March 29, 2019 03:00 ET (07:00 GMT)

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