RNS Number:0545I
Bango PLC
20 November 2007
20th November 2007
BANGO PLC
("Bango" or "the Company")
Interim Results for 6 months ending 30th September 2007
Bango (AIM:BGO) is pleased to announce today results for the 6 months ending
30th September 2007.
Financial Highlights (H1 FY08)
* Revenues up 49% to #6.84m (H1 FY07: #4.60m), up 17% vs. H2 FY07
* Content provider revenues up 50% to #1.05 m (H1 FY07: #0.70) up 25%
vs. H2 FY07
* Operating loss (before share based payments) reduced 35% to #0.98m (H1
FY07: #1.5m) and reduced by 37% vs. H2 FY07
* Period end cash balance #1.82m (March 2007: #1.93m)
* Opex reduced by 16% to #2.37m (H1 FY07 #2.83) through increasing
partner and technology leverage
Operational Highlights
* 108 Premium Customer wins (H1 FY07: 80) including AnimationFC and MTV.
* Successfully executing on strategy to target greater range of
customers with over 1,200 Starter Package sign-ups (H1 FY07: 23).
* Capitalising on the markets in the US and Canada, where end user
spending is up by 253% against the same period last year and 47% vs.
H2 FY07.
* Development of the innovative "Bango Button" that enables the users of
MySpace, Facebook, Flickr and other mobile communities to offer their
images and other content for mobile phone download direct from their
web pages.
Commenting on the interim results Lindsay Bury, Chairman of Bango, said, "Bango
has had a much improved six months, achieving increased revenues while
simultaneously reducing costs. Bango is in a leading position in the market
place and the second half of the year has started well. Transaction growth is
moving in the right direction and the momentum should continue. The Company is
reducing cash burn to below #100k (pcm) meaning that the transition to a
positive cash flow position and profitability is progressing well."
Contact Details:
Bango plc ICIS Limited Panmure Gordon & Co
Tel. +44 1223 472777 Tel. +44 20 7651 8688 Tel. +44 20 7459 3600
Ray Anderson, CEO Tom Moriarty Aubrey Powell
Peter Saxton, CFO Caroline Evans-Jones Stuart Gledhill
Introduction
At the end of FY 2007 management committed to grow revenues and increase
customer signup rates, while simultaneously reducing operating costs and cutting
cash consumption. Bango has successfully delivered against these targets.
This has been made possible by improving the operational efficiency of the
business and leveraging what are essentially fixed service delivery costs. The
average cost of signing up a new customer has reduced during the period and is
continuing to reduce as we increasingly develop sales through our web and
partner sales model. Concurrently the streamlining of our sales teams has seen a
significant increase in productivity. We believe that this trend will continue.
Mobile operators are now beginning to realise the potential of the mobile web,
and positive market sentiment is now in evidence, with significant recent
developments from Yahoo! and Google further adding to the momentum. As a
leading facilitator of business over the mobile web Bango is ideally positioned
to benefit from the direction the market is taking and we can look forward to
the future with confidence.
Financial highlights
Six months ended Change on Six months ended
Year ended
30 September 2007 H1 FY07 30 September 2006 31
March 2007
Unaudited Unaudited Unaudited
Audited
#m #m #m
#m
Revenue 6.84 2.24 4.60
10.43
Gross profit 1.40 0.08 1.32
2.47
Operating loss before share (0.98) 0.52 (1.50)
(3.06)
option costs
Loss before tax (1.08) 0.54 (1.62)
(3.32)
Cash outflow from (0.17) 1.39 (1.56)
(2.82)
operations
Cash position 1.82 (1.38) 3.20
1.93
Basic and fully diluted (4.02) 2.08 (6.10)
(12.40)
loss per share (pence)
Revenue was #6.8m up from #4.6m for the same period in the previous year,
representing growth of 49%. Content access fees (content sales through Bango)
grew from #3.9m to #5.8m (49% growth) while content provider fees grew from
#0.7m to #1.0m (50% growth).
Payouts to larger content providers were increased at the end of 2006, enabling
them to become more successful. As expected, this slowed the margin increase in
the short term. However, we have seen the expected improvement in margins going
forward with the increased rate of sign-up of smaller content providers and
anticipate this improvement continuing.
In terms of geographical breakdown, growth in revenues outside the UK market was
176% compared with H1 FY07 with the USA and Canada posting 187% growth and the
EU posting 213%. Non-UK geographies now represent 28% of total revenues against
15% at the end of H1 FY07. This demonstrates that the market conditions in other
territories are beginning to enable sale of content over the mobile web, as they
did in the UK a few years ago. The UK was the biggest contributor of revenues,
growing 26% from #3.9m to #4.9m.
Sales and marketing
Understanding of the mobile web opportunity has increased during the last year
as mobile operators have promoted it. Interest has been boosted by mobile web
announcements from Yahoo!, Google, Vodafone and Apple during the summer. We have
therefore been able to start shifting our marketing efforts from market
education to product sale. This enables increased salesperson productivity and
plays to the strength of our products and technology.
Though still small in absolute terms, the growth in direct sales from our
bango.com website has recently accelerated. Google's agreement to offer Bango
customers a free "Adwords package" has enabled smaller customers to experiment
with mobile web advertising.
Customer base
Bango's customers range from the very small to the very large. Many of our most
successful customers are those who focus on the emerging opportunities in mobile
search. There has been a shift of emphasis towards the small and medium sized
customers where sales lead times are shorter, sales costs lower and
relationships less expensive to service.
Product development
The development team has had a very productive period, bringing a number of new
products to market while at the same time evolving our existing products to
adapt to market needs and changes within the mobile operators. Our emphasis is
on developments that simplify and reduce the time taken for content providers to
get up and running on the mobile web, and on reducing their costs through the
use of Bango technology and our unique industry position. This will enable us
to acquire increasing numbers of customers at a lower cost.
The Bango website continues to evolve to make it easier for customers to sign up
to our services automatically. We have also placed emphasis on introducing
simpler and lower cost product offerings that are appealing to content owners
with little or no mobile experience. For low usage levels, our basic product
enables new entrants to sign up to the service without incurring a fixed monthly
cost.
The Bango Button
Our newest development is the 'Bango Button', which was launched last week.
Based on unique Bango technology developed over the last few years, it is an
exciting new proposition which has the potential to significantly accelerate the
use of the mobile web. Any of more than 300 million users of Myspace, Facebook,
Flickr or other communities can now simply add buttons to their pages that share
their pictures and other content direct to a viewer's mobile phone. Bango
technology is now of immediate value beyond our initial market of those content
providers that have the ability to build or commission websites.
Outlook
Bango has had a much improved six months, achieving increased revenues while
simultaneously reducing costs. Bango is in a leading position in the market
place and the second half of the year has started well. Transaction growth is
moving in the right direction and the momentum should continue. The Company is
reducing cash burn to below #100k (pcm) meaning that the transition to a
positive cash flow position and profitability is progressing well.
********
CONDENSED CONSOLIDATED INCOME STATEMENT FOR SIX MONTHS ENDED 30 SEPTEMBER 2007
Note
Six months ended Six months ended
Year ended 31
30 Sept 2007 30 Sept 2006
March 2007
Unaudited Unaudited
Audited
# #
#
Revenue 6,835,766 4,602,826
10,428,312
Cost of sales (5,438,338) (3,280,871)
(7,962,403)
Gross profit 1,397,428 1,321,955
2,465,909
Administrative expenses (2,374,047) (2,823,402)
(5,528,659)
Share based payments (147,317) (212,575)
(401,640)
Operating loss (1,123,936) (1,714,022)
(3,464,390)
Investment income 42,811 89,372
147,284
Finance costs - -
-
Loss before taxation (1,081,125) (1,624,650)
(3,317,106)
Income tax expense - -
-
Loss for the financial year (1,081,125) (1,624,650)
(3,317,106)
Attributable to equity holders of the Company (1,081,125) (1,624,650)
(3,317,106)
Loss per share attributable
to the equity holders of the Company
Basic loss per share 5 (4.02) (6.10)
(12.40)
Diluted loss per share 5 (4.02) (6.10)
(12.40)
All of the activities of the group are classed as continuing.
CONDENSED CONSOLIDATED BALANCE SHEET AS AT 30 SEPTEMBER 2007
30 Sept 2007 30 Sept 2006 31
March 2007
Unaudited Unaudited
Audited
# #
#
ASSETS
Non-current assets
Property, plant and equipment 402,087 545,230
506,450
Intangible assets 4 18,807 34,450
15,311
420,894 579,680
521,761
Current assets
Trade and other receivables 2,394,338 2,388,969
2,423,266
Cash and cash equivalents 1,819,013 3,200,583
1,931,094
4,213,351 5,589,552
4,354,360
Total assets 4,634,245 6,169,232
4,876,121
EQUITY
Capital and reserves attributable to equity
holders of the Company
Share capital 9 5,383,282 5,369,548
5,369,548
Share premium account 5,320,067 5,310,885
5,310,885
Merger reserve 1,236,225 1,236,225
1,236,225
Other reserve 743,152 406,770
595,835
Accumulated losses (11,153,395) (8,379,814)
(10,072,270)
Total equity 1,529,331 3,943,614
2,440,223
LIABILITIES
Current liabilities
Trade and other payables 3,104,914 2,225,618
2,435,898
Total liabilities 3,104,914 2,225,618
2,435,898
Total equity and liabilities 4,634,245 6,169,232
4,876,121
CONDENSED CONSOLIDATED CASH FLOW STATEMENT FOR SIX MONTHS ENDED 30 SEPTEMBER
2007
30 Sept 2007 30 Sept 2006
31 March 2007
Unaudited Unaudited
Audited
Note # #
#
Net cash used by operating activities 6 (167,052) (1,559,749)
(2,821,343)
Cash flows generated from/(used by) investing activities
Purchases of property, plant and equipment (10,756) (295,512)
(352,525)
Purchases of intangible assets - (15,971)
(15,971)
Disposal of property, plant & equipment - 1,007
2,984
Interest received 42,811 89,372
147,284
Net cash generated from/(used by) investing activities 32,055 (221,104)
(218,228)
Cash flows generated from financing activities
Proceeds from other issue of ordinary shares 22,916 118,432
118,433
Net cash generated from financing activities 22,916 118,432
118,433
Net decrease in cash and cash equivalents (112,081) (1,662,421)
(2,921,138)
Cash and cash equivalents at beginning of period 1,931,094 4,863,004
4,852,232
Cash and cash equivalents at end of period 1,819,013 3,200,583
1,931,094
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS AT 30 SEPTEMBER 2007
Share
premium Merger Other Accumulated
Share capital account reserve reserve losses
Total
# # # # #
#
At 1 April 2006 5,306,864 5,255,136 1,236,225 194,195 (6,755,164)
5,237,256
Loss for the period - - - - (1,624,650)
(1,624,650)
Total income / (expense) 5,306,864 5,255,136 1,236,225 194,195 (8,379,814)
3,612,606
recognised for the
period
Exercise of share 62,684 55,749 - - -
118,433
options
Share-based payment - - - 212,575 -
212,575
charge
At 30 September 2006 5,369,548 5,310,885 1,236,225 406,770 (8,379,814)
3,943,614
Loss for the period - - - - (1,692,456)
(1,692,456)
Total income / (expense) 5,369,548 5,310,885 1,236,225 406,770 (10,072,270)
2,251,158
recognised for the
period
Share-based payment - - - 189,065 -
189,065
charge
At 31 March 2007 5,369,548 5,310,885 1,236,225 595,835 (10,072,270)
2,440,223
Loss for the period - - - - (1,081,125)
(1,081,125)
Total income / (expense) 5,369,548 5,310,885 1,236,225 595,835 (11,153,395)
1,359,098
recognised for the
period
Exercise of share 13,734 9,182 - - -
22,916
options
Share-based payment - - - 147,317 -
147,317
charge
At 30 September 2007 5,383,282 5,320,067 1,236,225 743,152 (11,153,395)
1,529,331
Notes to the financial statements
1. General information
Bango plc ("the Company"), a United Kingdom resident, and its subsidiaries
(together "the Group") provide services to facilitate activity on the mobile
internet. The Company's shares are listed on the Alternative Investment Market
of the London Stock Exchange ("AiM"). The address of the Company's registered
office is 5, Westbrook Centre, Milton Road, Cambridge CB4 1YG.
The condensed consolidated interim financial information was approved by the
board of directors on (14 November 2007).
2. Basis of preparation
The condensed interim financial information for the half year ended 30 September
2007 has been prepared in accordance with IAS 34 'Interim financial reporting'.
The interim condensed financial report should be read in conjunction with the
annual financial statements for the year ended 31 March 2007.
The condensed consolidated financial information has been prepared
under the historical cost convention.
3. Principal accounting policies
The principal accounting policies adopted are consistent with those of the
annual financial statements for the year ended 31 March 2007.
4. Segment information
(a) The Group operates in three main business segments. Management reporting
is based principally on the type of service provided to customers. Accordingly,
the Group presents its primary segment analysis on this basis:
Six months ended 30 September 2007
Content access Content Services to Group
Total
fees provider fees mobile
operators
# # # #
#
Segment revenue 5,788,816 1,046,950 - -
6,835,766
Segment costs 5,207,831 230,507 - 2,521,364
7,959,702
Segment result 580,985 816,443 - (2,521,364)
(1,123,936)
Six months ended 30 September 2006
Content access Content Services to Group
Total
fees provider fees mobile
operators
# # # #
#
Segment revenue 3,891,701 699,125 12,000 -
4,602,826
Segment costs 3,197,251 83,620 - 3,035,977
6,316,848
Segment result 694,450 615,505 12,000 (3,035,977)
(1,714,022)
Year ended 31 March 2007
Content access Content Services to Group
Total
fees provider fees mobile
operators
# # # #
#
Segment revenue 8,859,633 1,536,564 32,115 -
10,428,312
Segment costs 7,686,510 275,893 - 5,930,299
13,892,702
Segment result 1,173,123 1,260,671 32,115 (5,930,299)
(3,464,390)
Group costs include all costs associated with staff, property & office,
marketing and depreciation.
(b) The secondary segment analysis is presented on a geographical basis:
Six months ended 30 September 2007
United Kingdom Rest of EU USA & Canada Rest of World
Total
# # # #
#
Segment revenue 4,941,742 772,749 909,252 212,023
6,835,766
Six months ended 30 September 2006
United Kingdom Rest of EU USA & Canada Rest of World
Total
# # # #
#
Segment revenue 3,916,661 246,750 316,936 122,479
4,602,826
Year ended 31 March 2007
United Kingdom Rest of EU USA & Canada Rest of World
Total
# # # #
#
Segment revenue 8,472,721 741,241 934,623 279,727
10,428,312
5. Earnings per share
(a) Basic and diluted earnings per share
Basic earnings per share is calculated by dividing the loss attributable to
equity holders of the Company by the weighted average of ordinary shares in
issue during the period.
Six months ended Six months ended
Year ended 31
30 Sept 2007 30 Sept 2006
March 2007
Unaudited Unaudited
Audited
#'000 #'000
#'000
Loss attributable to equity holders of the Company (1,081,125) (1,624,650)
(3,317,106)
Weighted average number of ordinary shares in issue 26,893,610 26,615,553
26,746,721
Basic and diluted loss per share (4.02) (6.10)
(12.40)
6. Cash used by operations
Six months ended Six months ended
Year ended 31
30 Sept 2007 30 Sept 2006
March 2007
Unaudited Unaudited
Audited
# #
#
Loss before taxation (1,081,125) (1,624,650)
(3,317,106)
Depreciation 111,623 73,892
186,847
Net finance costs (42,811) (89,372)
(147,284)
Share-based payment expense 147,317 212,575
401,640
(Increase)/decrease in receivables 28,928 (121,511)
(155,808)
Increase/(decrease) in payables 669,016 (10,683)
210,368
Net cash used by operations (167,052) (1,559,749)
(2,821,343)
7. Share capital
During the period, 68,670 share options were exercised at exercise prices
ranging between 29.5 pence and 50 pence for 68,670 shares with a par value of 20
pence. The total proceeds were #22,916 of which #13,734 was recognized as share
capital and #9,182 as share premium.
On 9 July 2007 15,000 options were granted to employees based in the USA, and on
19 September 2007 233,000 options were granted to employees. No options were
granted to Directors during the period.
8. Publication of non-statutory accounts
The financial information set out in this interim report does not constitute
statutory accounts as defined in section 240 of the Companies Act 1985. The
figures for the year ended 31 March 2007 have been extracted from the Statutory
Financial Statements of Bango plc, which have been filed with the Registrar of
Companies. The auditor's report on those financial statements is unqualified.
The financial information for the six months to 30 September 2007 and for the
six months to 30 September 2006 is unaudited.
The interim report together with an analysts briefing presentation will be
distributed to all shareholders shortly and copies will be available from the
Company's website at www.bango.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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