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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mobile Tornado Group Plc | LSE:MBT | London | Ordinary Share | GB00B01RQV23 | ORD 2P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.00 | 0.90 | 1.10 | 1.00 | 1.00 | 1.00 | 911 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Investors, Nec | 2.28M | -1.38M | -0.0033 | -3.03 | 4.18M |
From Apr 2019 to Apr 2024
TIDMMBT
RNS Number : 6851M
Mobile Tornado Group PLC
18 September 2019
18 September 2019
Mobile Tornado Group plc
("Mobile Tornado", the "Company" or the "Group")
Half Yearly Report
Mobile Tornado (AIM: MBT), the leading provider of instant communication mobile applications to the enterprise market, announces its unaudited results for the six-month period to 30 June 2019.
Financial Highlights
-- Total revenue increased by 21% to GBP1.49m (H1 2018: GBP1.23m)
o Recurring revenues broadly stable at GBP0.98m (H1 2018: GBP1.02m)
o Non-recurring revenues* increased by 140% to GBP0.51m (H1 2018: GBP0.21m)
-- Operating expenses decreased by 5% to GBP1.68m (H1 2018: GBP1.78m) -- Adjusted EBITDAE** losses reduced by 54% to GBP0.29m (H1 2018: GBP0.64m) -- Group operating loss of GBP0.40m (H1 2018: GBP0.72m) -- Loss after tax of GBP0.69m (H1 2018: GBP1.03m) -- Basic loss per share of 0.20p (H1 2018: 0.34p) -- Cash and cash equivalents of GBP0.03m (H1 2018: GBP0.33m)
o Post period end, completed a subscription to raise a total of GBP0.75m before expenses
*Non-recurring revenues comprising installation fees, hardware, professional services and capex license fees
**Earnings before interest, tax, depreciation, amortisation, exceptional items and excluding exchange differences
Operating highlights
-- Several bundled solution deals completed in Israel with public municipalities, government agencies and enterprises
-- Tender submitted and trial conducted with major government agency in South Africa
-- Sold and commissioned a server platform with an MNO partner in Colombia for deployment with a major transportation group
-- Completed an exclusive deal with a Chinese rugged handset manufacturer for customers in the Israel market
Post period end
-- Successfully completed a subscription to raise GBP0.75m to provide additional working capital and conversion of GBP0.78m of debt into equity by major shareholder InTechnology plc
Jeremy Fenn, Chairman of Mobile Tornado, said: "Our team has delivered an excellent first half. The EBITDAE loss has more than halved to GBP0.29m from GBP0.64m in 2018, driven by stable recurring revenues, a solid performance with our bundled offering in Israel and a new system deployment with our MNO partner in South America.
"More importantly, we have competed against major players in the PTT space in highly complex tenders, and won, securing some major strategic customers as a result. I have no doubt that the significantly enhanced credibility we have gained has put us in a strong position as we engage with similar organisations across both the public and private sectors.
"We are therefore well placed to further develop our business in each of our target markets. I expect the recurring revenue streams to return to growth in the second half of the current financial year as our efforts across Africa and South America, in particular, begin to gain traction. In Israel, we have a strong pipeline of new deals which we are confident will be developed further as the IDEN shutdown approaches at the end of the current calendar year."
Enquiries:
Mobile Tornado Group plc +44 (0)7734 475 888 Jeremy Fenn, Chairman www.mobiletornado.com Allenby Capital Limited (Nominated Adviser & Broker) +44 (0)20 3328 5656 James Reeve / Nicholas Chambers Walbrook PR Ltd +44 (0)20 7933 8780 Paul Cornelius / Nick Rome mobiletornado@walbrookpr.com
Financial results
Total turnover in the six-month period to 30 June 2019 increased by 21% to GBP1.49m (H1 2018: GBP1.23m). Recurring revenues remained broadly stable in the period at GBP0.98m (H1 2018: GBP1.02m). Non-recurring revenues, comprising installation fees, hardware, professional services and capex license fees increased by 140% to GBP0.51m (H1 2018: GBP0.21m). As a result, gross profit increased by 22% to GBP1.39m (H1 2018: GBP1.14m).
Our reported operating expenses decreased by 5% to GBP1.68m (H1 2018: GBP1.78m) reflecting the positive impact our investments have made to date and the operating efficiencies our technical platform is now delivering.
Due to the annual revaluation of certain financial liabilities on the balance sheet, the Group reported a translational loss of GBP0.01m (H1 2018: GBP0.04m loss) arising from the depreciation of Sterling comparative to the start of the period. As a result of the above, the loss after tax for the period decreased by 33% to GBP0.69m (H1 2018: Loss GBP1.03m).
The net cash outflow from operating activities during the period reduced to GBP0.46m (H1 2018: GBP1.42m). At 30 June 2019, the Group had GBP0.03m cash at bank (30 June 2018: GBP0.33m) and net debt of GBP8.85m (30 June 2018: GBP7.81m). Of this net debt figure, GBP5.62m is in respect of preference shares, held by InTechnology plc, the Company's largest shareholder. These preference shares are redeemable at par value on 31 December 2020, or, at the Company's discretion, at any earlier date.
The Company completed a placing on 28 August 2019, raising GBP0.75m before expenses at an issue price of 5p per share. At the same time, InTechnology converted GBP0.78m of current debt into equity at the 5p issue price, resulting in a total of 30,504,687 new ordinary shares being issued.
Review of Operations
The Board is delighted with the operational progress the Group has made during the first half of the year, with positive momentum developing in each of our target markets of Israel, Africa and the Americas.
In Israel, our bundled solution has sold well during the first half of the year, with notable deals concluded with public utilities, local authorities and government agencies. The bundled solution comprises our full end-to-end proposition including server platform, devices, applications and dispatch console, alongside an embedded perpetual license for use of the service. This has had a positive effect on the Group's cashflow and profitability as we receive margin on the license upfront, as well as separate margin on the hardware that we procure on behalf of the customer. With the IDEN switch-off in Israel scheduled for the end of 2019, the Board anticipates that activity levels should accelerate in the second half of the current financial year.
During the period, we sold and commissioned a new server platform for a major MNO in Colombia, and this will be deployed during the second half of the year, initially for a major transportation group. We understand from our MNO partner that they will use this platform to sell services to other transportation groups, once the first customer has been fully commissioned. During the last 18 months, we have dramatically reduced the cost of ownership for a private system and this deal is a perfect illustration of the types of opportunities that are now opening up as a result.
In South Africa, we have been working with one of our MNO customers on the submission of a tender for the deployment of services across a major government agency. Extensive trials have been running successfully for a number of weeks and we are hopeful that a deal will conclude during the second half. We have a major strategic advantage in Africa given our technical superiority. Cellular infrastructure on this continent is still largely 2G and 3G, and we are currently the only cellular PTT carrier grade market solution that can transition seamlessly across 2G, 3G, 4G and WiFi networks, delivering an uninterrupted service to the end user. As a result, we are engaged with the two leading MNOs in this territory and are currently involved in multiple tenders across government agencies, public authorities and enterprises.
Now that we are offering an end-to-end solution, we are able to ensure that the handsets we offer are optimised to work seamlessly with our applications. To this end, we are constantly reviewing the new low cost rugged PoC handsets that are now emerging as the market expands, to ensure we are in a position to offer our customers the best overall value proposition. Following a recent review, we secured an exclusive deal with a Chinese manufacturer, requiring us to commit to purchasing 5,000 handsets over the first 12 months to maintain such exclusivity. As a result, we have had to increase the handset stock levels and this is one of the reasons we raised additional external funds during August.
Research and Development
As I have highlighted in the past, the barriers to entry for cellular based PTT solution providers like Mobile Tornado into the public safety markets are very high, largely due to the dominant position of the established players offering radio-based solutions that operate on their own, high cost, bespoke infrastructure and handsets. They will not give up their control of these markets easily, but we have demonstrated that, with our constantly improving cellular based solution, we are able to secure public safety contracts, evidenced by certain deals that have closed during the first half of the year. I'm pleased to confirm that this transformative development is being driven across all of our target markets.
We have also been able to achieve this through our continued investment in developing the fastest, most robust, fully functioned, efficient PoC solution on the market. It's worth highlighting again some of the key characteristics of our solution:
-- Speed - 500 millisecond set up time
-- Capacity - our dual redundant servers can now be deployed to cater for >200,000 users and our dispatch console can handle 18 independent PTT channels
-- Security - end-to-end encryption with a different key for each transmission, and new developments to counter the increasing cyber threat
-- Functionality/features - push to talk/alert/location/message/video, dispatch console and recording are all part of the solution
-- Efficiency - server/application optimised to ensure device battery consumption minimised
We believe these technical advantages are now being recognised by large organisations within both the public and private sector and utilising our new customers as case studies and references, will significantly enhance our credibility as we make further inroads into the public safety markets.
Funding
We completed a placing for GBP0.75m in August 2019, to provide the business with additional working capital. This has enabled the Group to build up a small increase in handset stocks and take a more flexible approach when negotiating deals with prospective customers. The GBP0.30m revolving loan facility with InTechnology plc will also remain in place.
The 2018 Annual Report and Accounts highlighted a significant outstanding receivable with one of our partners. This amount stood at GBP0.64m as at 31 December 2018 and GBP0.80m as at 30 June 2019. The Group was hoping to collect the outstanding debt in the short term following an equity investment into said partner. The equity investment was not completed as anticipated, due to the unfavourable capital market environment, and we have been in discussions since then to determine a mutually acceptable way forward. Based on a growing pipeline of new business and our partner's recent move into profitability, I'm pleased to report that we have agreed an acceptable repayment schedule with our partner to settle this debt over a maximum 36-month period with certain accelerated debt repayment opportunities.
Outlook
Our team has delivered an excellent first half. The EBITDAE loss has more than halved to GBP0.29m from GBP0.64m in 2018, driven by stable recurring revenues, a solid performance with our bundled offering in Israel and a new system deployment with our MNO partner in South America.
More importantly, we have competed against major players in the PTT space in highly complex tenders, and won, securing some major strategic customers as a result. I have no doubt that the significantly enhanced credibility we have gained has put us in a strong position as we engage with similar organisations across both the public and private sectors.
We are therefore well placed to further develop our business in each of our target markets. I expect the recurring revenue streams to return to growth in the second half of the current financial year as our efforts across Africa and South America, in particular, begin to gain traction. In Israel, we have a strong pipeline of new deals which we are confident will be developed further as the IDEN shutdown approaches at the end of the current calendar year.
The Board would like to thank those shareholders that supported the recent fundraising and we look forward to the remainder of 2019 and beyond with increasing confidence.
Jeremy Fenn
Chairman
18 September 2019
Consolidated income statement
For the six months ended 30 June 2019
Hot Features
Premium
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Continuing Operations
Revenue 1,493 1,234 2,974
---------------------------------------- ----------------- ----------------- ---------------
Cost of sales (101) (95) (315)
---------------------------------------- ----------------- ----------------- ---------------
Gross profit 1,392 1,139 2,659
Other operating expenses (1,683) (1,775) (3,547)
Group operating loss before exchange
differences,
exceptional items, depreciation and
amortisation expense (291) (636) (888)
---------------------------------------- ----------------- ----------------- ---------------
Exchange differences (12) (44) (138)
Exceptional items - - (49)
Depreciation and amortisation expense (98) (37) (208)
Total operating expenses (1,793) (1,856) (3,942)
Group operating loss (401) (717) (1,283)
Finance costs (290) (334) (619)
Loss before tax (691) (1,051) (1,902)
Income tax credit - 17 367
Loss for the period (691) (1,034) (1,535)
---------------------------------------- ----------------- ----------------- ---------------
Loss per share (pence)
Basic and diluted (0.20) (0.34) (0.47)
---------------------------------------- ----------------- ----------------- ---------------
Consolidated statement of comprehensive income
For the six months ended 30 June 2019
Six months Six months Year ended
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss for the period (691) (1,034) (1,535)
Other comprehensive income
Exchange differences on translation
of foreign operations (1) (11) (28)
Total comprehensive loss for
the period (692) (1,045) (1,563)
-------------------------------------- ----------- ----------- ------------
Consolidated statement of changes in equity
For the six months ended 30 June 2019
Reverse
Share Share acquisition Merger Translation Retained Total
capital premium reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
January
2018 5,427 12,672 (7,620) 10,938 (2,213) (34,220) (15,016)
Equity settled
share-based
payments - - - - - 29 29
Issue of share
capital 1,558 2,252 - - - - 3,810
Transactions
with owners 1,558 2,252 - - - 29 3,839
Loss for the
period - - - - - (1,034) (1,034)
Exchange
differences
on translation
of foreign
operations - - - - (11) - (11)
Total
comprehensive
income
for the period - - - - (11) (1,034) (1,045)
Balance at 30
June 2018 6,985 14,924 (7,620) 10,938 (2,224) (35,225) (12,222)
--------------- ------------- --------------- ----------------- --------------- ------------------ ----------------- -----------------
Reverse
Share Share acquisition Merger Translation Retained Total
capital premium reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
July 2018 6,985 14,924 (7,620) 10,938 (2,224) (35,225) (12,222)
Equity settled
share-based
payments - - - - - 25 25
Transactions
with owners - - - - - 25 25
Loss for the
period - - - - - (501) (501)
Exchange
differences
on translation
of foreign
operations - - - - (17) - (17)
Total
comprehensive
income
for the period - - - - (17) (501) (518)
Balance at 31
December
2018 6,985 14,924 (7,620) 10,938 (2,241) (35,701) (12,715)
--------------- ------------- --------------- ----------------- --------------- ------------------ ----------------- -----------------
Reverse
Share Share acquisition Merger Translation Retained Total
capital premium reserve reserve reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
January
2019 6,985 14,924 (7,620) 10,938 (2,241) (35,701) (12,715)
Equity settled
share-based
payments - - - - - 27 27
Transactions
with owners - - - - - 27 27
Loss for the
period - - - - - (691) (691)
Exchange
differences
on translation
of foreign
operations - - - - (1) - (1)
Total
comprehensive
income
for the period - - - - (1) (691) (692)
Balance at 30
June 2019 6,985 14,924 (7,620) 10,938 (2,242) (36,365) (13,380)
--------------- ------------- --------------- ----------------- --------------- ------------------ ----------------- -----------------
Consolidated balance sheet
As at 30 June 2019
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Property, plant & equipment 168 308 219
Intangible assets 69 115 88
237 423 307
------------------------------ ---------- ---------- ------------
Current assets
Trade and other receivables 1,489 1,125 1,243
Inventories 69 93 151
Tax debtor 364 493 462
Cash and cash equivalents 33 328 354
------------------------------- ---------- ---------- ------------
1,955 2,039 2,210
------------------------------ ---------- ---------- ------------
Liabilities
Current liabilities
Trade and other payables (4,858) (4,364) (4,555)
Borrowings (3,262) (2,510) (2,796)
Net current liabilities (6,165) (4,835) (5,141)
------------------------------- ---------- ---------- ------------
Non-current liabilities
Trade and other payables (1,828) (2,187) (2,257)
Borrowings (5,624) (5,623) (5,624)
(7,452) (7,810) (7,881)
------------------------------ ---------- ---------- ------------
Net liabilities (13,380) (12,222) (12,715)
------------------------------- ---------- ---------- ------------
Shareholders' equity
Share capital 6,985 6,985 6,985
Share premium 14,924 14,924 14,924
Reverse acquisition reserve (7,620) (7,620) (7,620)
Merger reserve 10,938 10,938 10,938
Foreign currency translation
reserve (2,242) (2,224) (2,241)
Retained earnings (36,365) (35,225) (35,701)
Total equity (13,380) (12,222) (12,715)
------------------------------- ---------- ---------- ------------
Consolidated cash flow statement
For the six months ended 30 June 2019
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Operating activities
Cash used in operations (464) (1,421) (1,849)
Tax credit received - - 493
Net cash used in operating activities (464) (1,421) (1,356)
---------------------------------------- ---------------- ---------------- ------------------
Investing activities
Purchase of property, plant
& equipment (27) (56) (101)
Net cash used in investing activities (27) (56) (101)
---------------------------------------- ---------------- ---------------- ------------------
Financing
Issue of ordinary share capital - 1,351 1,351
Share issue costs - (81) (81)
Proceeds from borrowings 170 (200) (200)
Net cash inflow from financing 170 1,070 1,070
---------------- ---------------- ------------------
Effects of exchange rates on
cash
and cash equivalents - 3 9
---------------------------------------- ---------------- ---------------- ------------------
Net increase in cash and
cash equivalents in the period (321) (404) (378)
Cash and cash equivalents at
beginning of period 354 732 732
Cash and cash equivalents at
end of period 33 328 354
---------------------------------------- ---------------- ---------------- ------------------
Notes to the interim report
For the six months ended 30 June 2019
1 General information
The financial information in the interim report does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006 and has not been audited or reviewed. The financial information relating to the year ended 31 December 2018 is an extract from the latest published financial statements on which the auditor gave an unmodified report that did not contain statements under section 498 (2) or (3) of the Companies Act 2006 and which have been filed with the Registrar of Companies.
2 Basis of preparation
These interim financial statements are for the six months ended 30 June 2019. They have been prepared using the recognition and measurement principles of IFRS.
The interim financial statements have been prepared under the historical cost convention.
The interim financial statements have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year ended 31 December 2018. The accounting policies have been applied consistently throughout the Group for the purpose of preparation of the interim financial statements.
3 Loss per share
Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders of GBP691,000 (30 June 2018: GBP1,034,000, 31 December 2018: GBP1,535,000) by the weighted average number of ordinary shares in issue during the period of 349,240,236 (30 June 2018: 303,775,500, 31 December 2018: 326,694,121).
Six months Six months
ended ended Year ended
31 December
30 June 2019 30 June 2018 2018
Unaudited Unaudited Audited
Basic and diluted Basic and diluted Basic and diluted
Loss Loss Loss Loss Loss Loss
per share per share per share
GBP'000 pence GBP'000 pence GBP'000 pence
Loss attributable to
ordinary shareholders (691) (0.20) (1,034) (0.34) (1,535) (0.47)
----------------------- ---------- ---------- --------- ------------ ----------- -----------
4 Share capital and share premium
Number
of Share Share Total
shares capital premium
'000 GBP'000 GBP'000 GBP'000
At 1 January 2018 271,353 5,427 12,672 18,099
Issue of shares 77,887 1,558 2,252 3,810
----------------------------------- ------------- ---------- ----------- -----------
At 30 June 2018, 31 December 2018
& 30 June 2019 349,240 6,985 14,924 21,909
----------------------------------- ------------- ---------- ----------- -----------
Non-voting preference shares
Number
of Nominal
shares Value
'000 GBP'000
At 30 June 2018, 31 December 2018 and 30 June
2019 71,277 5,702
------------------------------------------------ -------- ----------
Liabilities and preference shares totalling GBP5,702k were converted into 71,277k 8p preference shares on 28 August 2013. The preference shares are non-voting, non-convertible redeemable preference shares redeemable at par value on 31 December 2020, or, at the Company's discretion, at any earlier date. The preference shares accrue interest at a fixed rate of 10% per annum.
5 Cash used in operations
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Loss before taxation (691) (1,051) (1,902)
Adjustments for:
Depreciation and amortisation 98 37 208
Share based payment charge 27 29 54
Interest expense 290 334 619
Changes in working capital:
Decrease/(Increase) in inventories 82 (92) (149)
(Increase)/Decrease in trade and
other receivables (148) 125 (200)
Decrease in trade and other payables (122) (803) (479)
Net cash used in operations (464) (1,421) (1,849)
-------------------------------------- ---------------- ------------------ --------------------
6 Shareholder information
The interim announcement will be published on the company's website www.mobiletornado.com on 18 September 2019.
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 BCGDCDBBBGCR
(END) Dow Jones Newswires
September 18, 2019 02:01 ET (06:01 GMT)
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