TIDMMES
RNS Number : 8569S
Messaging International Plc
29 September 2014
Messaging International Plc / Market: AIM / Epic: MES / Sector:
Technology
Messaging International Plc
('Messaging International' or 'the Company')
Interim Results
Messaging International Plc, the AIM traded company and provider
of innovative messaging services, announces its unaudited results
for the six months ended 30 June 2014.
Overview
-- Development of new product: "Secure Mobile Messaging for Enterprises"
-- Gross revenues for the six months GBP1,851,237 (H1 2013: GBP2,005,559)
-- Pre tax loss for the period - GBP186,664 (H1 2013: Loss GBP36,896)
Chairman's Statement
As we described in our last annual report, the Company is
developing Secure Mobile Messaging for Enterprises, a new product
line based on our core platform. Secure Mobile Messaging for
Enterprises is a messaging-suite for enterprises that replicates
the ease of use of consumer applications such as WhatsApp, Viber
and Facebook while providing all the additional tools that
businesses need in order to stay on top of corporate mobile
messages which are "MANAGED, SECURE, RELIABLE and IT READY".
The entire team continue to work hard in order to add new
features and functions to our applications. A fresh new user
interface has been developed with the focus on usability and user
experience. New versions are uploaded to Apple App Store and Google
Play. Updated versions are expected to be uploaded in the coming
months.
As part of this new family of products, the Company is
co-developing a version with a major US wireless network operator.
As announced on 22 July 2014, the two companies have been approved
for funding of $900,000 by the Israeli-US Binational Industrial
Research and Development Foundation ("BIRD"). TeleMessage has been
allocated 70% of this funding with the project due to be completed
in late 2015.
We believe that this version of the product should be compelling
to other carriers worldwide.
The Company has also decided to develop its own sales and
marketing channels for the Secure Mobile Messaging for Enterprises
solution. This will mean that we will invest in inbound marketing
techniques promoting the Company through blogs, webinars, videos,
newsletters, whitepapers, SEO, social media marketing and other
forms of content marketing which serve to bring customers closer to
our brand. Our new website was launched in late August, 2014.
The focus on direct enterprise relationships, as an extension to
what the Company has been doing for a number of years in Israel,
has resulted in answering RFPs for potential enterprise customers
that could result in additional business opportunities from a
larger customer base later this year or next year.
Financial Results
For the six month period ended 30 June 2014, we are reporting a
loss of GBP186,664 (H1 2013: loss GBP36,896) on revenues of
GBP1,851,237 (H1 2013: GBP2,005,559). The continued losses are in
the main attributable to the increased costs of research and
development.
Messaging's cash position at 30 June 2014 was GBP377,058 (31
December 2013: GBP765,026). The bank loan from Mizrahi Tefahot Bank
outstanding at 30 June 2014 was GBP198,892 (31 December 2013:
GBP303,016).
Outlook
The increased cost of research and development in the first half
of this financial year is expected to continue at a similar level
for the remainder of 2014 in order to support our longer term
growth plans with a corresponding impact on the Company's financial
performance for the year as a whole. We expect the BIRD funding to
cover part of this additional R&D cost. The Company also
expects to incur increased costs of sales and marketing in order to
promote new solutions including 'Secure Messaging for
Enterprises'.
I would like to thank our team for their hard work and
dedication, and our shareholders for their continued support. I
look forward to reporting improved results and positive news on the
introduction of the Secure Messaging for Enterprises in our next
annual report.
H Furman
Chairman
29 September 2014
For more information visit www.telemessage.com or contact:
Guy Levit Messaging International Tel: + 972 3 9225252
Plc
Horacio Furman Messaging International Tel: + 972 3 6964420
Plc
Mark Percy/ Cantor Fitzgerald Europe Tel: +44 (0) 20 7894
Catherine Leftley 7000
Consolidated statement of comprehensive income for the six
months ended 30 June 2014
Unaudited Unaudited Audited
Notes six months six months year ended
ended ended 31 December
30 June 2014 30 June 2013 2013
GBP GBP GBP
Revenues 2 1,851,237 2,005,559 3,775,910
Cost of revenue (640,431) (776,113) (1,411,536)
Gross profit 1,210,806 1,229,446 2,364,374
-------------- -------------- -------------
Operating expenses
Research and development (681,464) (636,407) (1,188,500)
Sales and marketing (417,490) (387,624) (739,249)
Administrative costs (258,976) (233,108) (463,304)
Total operating expenses (1,357,930) (1,257,139) (2,391,053)
-------------- -------------- -------------
Operating loss (147,124) (27,693) (26,679)
Finance costs (39,540) (9,203) (65,394)
(Loss) before taxation (186,664) (36,896) (92,073)
Taxation 3 - (11,668) 2,914
Loss for the period/year (186,664) (48,564) (89,159)
============== ============== =============
Other comprehensive profit/(loss)
Re-measurement of loss from
defined benefit scheme - - (5,576)
Foreign exchange difference
on translation of foreign
operations (19,568) 60,160 (3,858)
Foreign exchange difference
arising from restating
the carrying value of
goodwill associated with
foreign operations - - (85,286)
(19,568) 60,160 (94,720)
============== ============== =============
Total comprehensive (loss)/profit (206,232) 11,596 (183,879)
============== ============== =============
Loss per share
Basic and diluted loss
per share 4 (0.16)p (0.03)p (0.07)p
============== ============== =============
Consolidated statement of changes in equity for the six months
ended 30 June 2014
Capital
Share redemption Translation Revenue
capital reserve reserve reserves Total
GBP GBP GBP GBP GBP
As at 1 January
2014 579,361 600,039 118,602 2,845,271 4,143,273
(Loss) for the
period (186,664) (186,664)
Share based payments 25,919 25,919
Foreign currency
translation changes (19,568) (19,568)
As at 30 June
2014 579,361 600,039 99,034 2,684,526 3,962,960
============= ============ ============ ============ ============
As at 1 January
2013 779,361 400,039 207,746 3,340,006 4,727,152
Capital reorganisation (200,000)) 200,000 -
Re purchase of
shares (400,000) (400,000)
(Loss) for the
period (48,564) (48,564)
Foreign currency
translation changes 60,160 60,160
As at 30 June
2013 579,361 600,039 267,906 2,891,442 4,338,748
============= ============ ============ ============ ============
As at 1 January
2013 779,361 400,039 207,746 3,340,006 4,727,152
Capital reorganisation (200,000)) 200,000 -
Purchase of share (400,000) (400,000)
(Loss) for the
for the year (89,159) (89,159)
Re-measurement
of defined benefit
plan (5,576) (5,576)
Foreign currency
translation changes
for goodwill (85,286) (85,286)
Other foreign
currency translation
changes (3,858) (3,858)
As at 31 December
2013 579,361 600,039 118,602 2,845,271 4,143,273
============= ============ ============ ============ ============
Consolidated Statement of financial position as at 30 June
2014
Unaudited Unaudited Audited
as at as at as at
30 June 30 June 31 December
2014 2013 2013
GBP GBP GBP
Non current assets
Goodwill 3,432,759 3,518,045 3,432,759
Property, plant and equipment 120,870 184,345 162,655
Other investments 314,183 309,970 323,704
3,867,812 4,012,360 3,919,118
------------ ------------ -------------
Current assets
Trade and other receivables 862,212 994,389 784,654
Cash and cash equivalents 377,058 709,391 765,026
1,239,270 1,703,780 1,549,680
------------ ------------ -------------
Total assets 5,107,082 5,716,140 5,468,798
Current liabilities
Trade and other payables (556,084) (561,682) (616,701)
Borrowings (198,892) (191,985) (199,019)
------------ ------------ -------------
(754,976) (753,667) (815,720)
------------ ------------ -------------
Non current liabilities
Borrowings - (233,071) (103,997)
Other payables (6,233) (39,443) (23,618)
Employee provisions (382,913) (351,211) (382,190)
------------ ------------ -------------
(389,146) (623,725) (509,805)
------------ ------------ -------------
Total liabilities (1,144,122) (1,377,392) (1,325,525)
Net assets 3,962,960 4,338,748 4,143,273
============ ============ =============
Equity
Share capital 579,361 579,361 579,361
Capital redemption reserve 600,039 600,039 600,039
Foreign currency translation
reserve 99,034 267,906 118,602
Revenue reserves 2,684,526 2,891,442 2,845,271
Shareholders' equity 3,962,960 4,338,748 4,143,273
============ ============ =============
Consolidated cash flow statement for the six months ended 30
June 2014
Unaudited Unaudited Audited
six months six months year ended
ended ended 31 December
30 June 2014 30 June 2013 2013
GBP GBP GBP
Cash flow from operating
activities
(Loss) before taxation (147,124) (27,693) (26,679)
-------------- -------------- -------------
Adjustments for:
Share based payments 25,919 26,100 -
Defined benefit plan - - (5,576)
Depreciation and amortisation 43,289 42,809 64,533
Foreign currency translation
adjustments (39,370) 44,105 (39,461)
-------------- -------------- -------------
29,838 113,014 19,496
-------------- -------------- -------------
Operating cash flow before
working capital movements (117,286) 85,321 (7,183)
Increase/(decrease) in receivables (77,558) 91,882 301,617
(Decrease)/increase in payables (78,002) 32,429 71,623
Increase in provisions 723 21,354 52,333
(154,837) 145,665 425,573
-------------- -------------- -------------
Cash (outflow)/inflow from
operating activities (272,123) 230,986 418,390
Investing activities
Investments 9,521 (34,278) (48,012)
Repurchase of shares - (400,000) (400,000)
Purchase of property, plant
and equipment (6,288) (37,423) (52,405)
Net cash from /(used in)
investing activities 3,233 (471,701) (500,417)
-------------- -------------- -------------
Taxation - (11,668) 2,914
-------------- -------------- -------------
Financing activities
Interest and related costs (14,954) (9,203) (25,449)
Bank loan repayments (104,124) (98,684) (200,073)
Net cash (used) in financing
activities (119,078) (107,887) (225,522)
-------------- -------------- -------------
Net decrease in cash and
cash equivalents (387,968) (360,270) (304,635)
Cash and cash equivalents
at the beginning of the period/year 765,026 1,069,661 1,069,661
Cash and cash equivalents
at the end of the period/year 377,058 709,391 765,026
============== ============== =============
Notes to the interim report
For the six months ended 30 June 2014
1. Basis of preparation and consolidation
The financial information contained in the interim results has
been prepared in accordance with International Financial Reporting
Standards ('IFRS') as adopted by the European Union. It has been
prepared in accordance with IAS 34 - Interim Financial Reporting
and does not include all of the information required for full
annual financial statements.
The financial information contained in these interim results for
the six months ended 30th June 2014 and 30th June 2013 are
un-audited. The comparative figures for the year ended 31st
December 2013 do not constitute statutory financial statements of
the group within the definition of S434 of the Companies Act 2006.
Full audited accounts of the group in respect of that financial
period prepared in accordance with IFRS, which we received an
unqualified audit opinion have been delivered to Registrar of
Companies.
The accounting policies and methods of computation used in the
interim statement are consistent with those used in the financial
statements for the year ended 31 December 2013 and are in
accordance with International Financial Reporting Standards.
The statement of comprehensive income, statement of changes in
equity and financial position include the financial statements of
the company and its subsidiary undertakings up to 30 June 2014.
The consolidated interim financial statements do not include all
the information required for full annual financial statements and
therefore cannot be construed to be in full compliance with
IFRS.
The consolidated interim financial statements were approved by
the board and authorised for issue on 29 September 2014.
2. Turnover
Unaudited Unaudited Audited
six months six months year ended
ended ended 31 December
30 June 2014 30 June 2013 2013
GBP GBP GBP
North America 1,626,395 1,797,054 3,359,569
Europe and Middle
East 205,226 173,587 378,194
Rest of the World 19,616 34,918 38,147
-------------- -------------- -------------
1,851,237 2,005,559 3,775,910
-------------- -------------- -------------
3. Taxation
The tax charge in the six months ended 30 June 2013 represented
amounts due for US State tax in relation to the profits of
TeleMessage Inc. based in the USA. U.S. operating losses from
previous years are subject to annual limitations due to the "change
in ownership" provisions of the Internal Revenue Code of 1986 and
similar state provisions.
No further provision has been made for taxation as there are
losses available to carry forward against future trading profits.
No deferred tax asset has been recognised in accordance with
International Accounting Standard 12.
4. Basic and diluted loss per share
For the six months ended 30 June 2014, basic loss per share has
been calculated on the Group's loss attributable to owners the
Company of GBP186,664 and on the weighted average number of shares
in issue during the year, which was 115,872,147.
For the six months ended 30 June 2013, basic loss per share has
been calculated on the Group's loss attributable to owners the
Company of GBP48,564 and on the weighted average number of shares
in issue during the year, which was 141,319,485.
For the six month periods ended 30 June 2014 and 30 June 2013,
share options and warrants to subscribe for shares in the company
are anti-dilutive and therefore diluted earnings per share
information is the same as the basic loss per share.
For the year ended 31 December 2013, basic loss per share has
been calculated on the Group's loss of GBP89,159 and on the
weighted average number of shares in issue in 2013 of
134,064,000.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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