TIDMMTV
RNS Number : 5705R
Motive Television PLC
30 June 2015
30 June 2015
Motive Television PLC
("Motive", "the Company" or "the Group")
Final results for the year ended 31 December 2014
Motive Television PLC (AIM: MTV.LN), the digital television
technology, software and solutions provider, announces its
preliminary results for the 12 months ended 31 December 2014.
CHAIRMAN'S STATEMENT
I am pleased to announce Motive's results for the year ended 31
December 2014.
During the year under review Motive completed the final steps of
transitioning its technology to enable the transfer of content to
tablets and to other mobile devices, meeting key technical
milestones and preparing for commercialisation.
The soft launches of Tablet TV in the USA and in the UK were
completed successfully. Additionally, new markets were identified
during the year and technology to exploit these was developed;
commercial implementation of these commenced after the year
end.
During this period of intense development sales levels were flat
as the Group's productive resources were focused on development
activity. At the same time other costs increased as distribution
channels and manufacturing resources were established. Therefore,
as a direct consequence of these factors operating losses increased
during the year under review as compared with 2013.
With the shift towards exploitation of new technology and the
opportunities now arising, the Directors have reviewed the goodwill
which arose on the acquisition of Motive Television S.L. nearly
five years ago. With the new emphasis on the rapidly developing
mobile market the Directors concluded that it was appropriate to
recognize this by making a full impairment against the historic
goodwill. This impairment is included in Administrative costs and
identified in the Statement of Comprehensive Income as an
exceptional cost.
The Company's dispute with HISCAN (formerly CCAN) in respect of
the formal transfer of a 32.3% interest in Motive Television S.L.
is currently under consideration in the Spanish Courts. HISCAN has
agreed that they will sell their shares on receipt of the sum of
EUR750,000 and this amount has now been included in the accounts as
a liability. Charges in respect of changes in the estimate of the
amount due as a consequence of this dispute are included in the
Statement of Comprehensive Income as exceptional financial
costs.
Today, the Group's main focus is its Digital Business that
provides technology-based solutions to companies and viewers in the
television sector. As such, the Group Strategic Report will focus
on this segment of the Group's activity.
The Strategic Report discusses the environment in which the
Digital Business operates, sets out in detail the substantial
opportunities for the Digital Business and outlines how the Group
intends to take advantage of these opportunities. The significant
progress made to date is discussed as well as where the Group
envisages future development.
The Company still owns one remaining television production
business, Motive Television Limited (Dublin) ("MTL"). MTL enjoyed a
reasonably good year in terms of orders but ended the year with a
small loss. Although this business contributed GBP497,443 (43%) of
turnover it is now under strategic review.
I would like to thank our shareholders, employees, customers,
partners and suppliers for their continuing support. Special thanks
go to Leonard M. Fertig, your CEO, whose drive and boundless
ambition have once again enabled the Company to make substantial
progress during the year under review.
Michael Pilsworth
Chairman
Financial analysis
-- Group revenue was broadly flat compared with 2013 at GBP1,143,314 from GBP 1,170,942 in 2013.
-- Group operating loss before exceptional charges for goodwill
impairment increased to GBP(2,764,137) from GBP(1,861,778) in
2013.
-- Group loss for the year of GBP (12,530,987) 2013 GBP (3,007,720).
-- Net cash flows from operating activities improved 19% from
negative GBP2,141,445 in 2013 to negative GBP1,725,432.
-- Digital business revenue decreased by 19% to GBP645,871 from GBP804,826 in 2013.
-- Digital business loss increased to GBP1,301,818 from GBP
(912,449) in 2013 as costs increased in preparation for commercial
launch of new products.
-- Group total borrowings increased by 34% to GBP4,170,850 compared with GBP3,101,256 in 2013.
-- Cash at bank and in hand at the end of 2014 was GBP595,608 compared to GBP250,404 in 2013.
Operational highlights
-- In January 2014, Motive completed the update of its Content
Express(TM) platform and launched it in the broadcasting
marketplace.
-- Deployment of the Content Express(TM) solution at Digiturk in
Turkey exceeded expectations with at least 175,000 households using
the technology by the end of the year.
-- Following signature of a five-year contract with Siyaya Free
To Air TV (PTY) Ltd. of Johannesburg, South Africa on 30 December
2014, Motive installed and integrated its Content Express(TM)
technology at Siyaya's headend in South Africa.
-- Motive joined the HbbTV Consortium and the Digital Technology
Group to participate and promote its technology among the top
television companies in the UK and Europe.
-- In May 2014 the Company filed applications with the patent
office in the United States regarding the Tablet TV technology and
its datacasting technology and progressing the Tablet TV patent
worldwide based on the Patent Cooperation Treaty.
-- In August 2014, Motive announced the signing of a contract
with Twin Peak S. A. of Athens Greece to develop and market BYOD TV
technology for the maritime market of passenger ferries, cruise
ships, oil platforms, commercial ships, and yachts.
-- In September 2014, the Company renewed its support contract with Mediaset for a sixth year.
-- On 25 November 2014, Motive announced the taking of
pre-orders for TabletTV US in San Francisco, and the service was
launched on a beta basis on 18 December 2014.
-- On 8 December 2014 the Company launched TabletTV UK on a beta
basis in time for Christmas deliveries.
-- On 23 December 2014, Motive announced that the development of
its new BYOD TV technology was complete and that it was ready for
testing and deployment on commercial ships.
Post-Period Highlights
-- On 19 January 2015, the Company announced an agreement with
Google to integrate Chromecast capabilities with TabletTV. This
effort has ensued and is expected to be available in the coming
weeks following review by Google.
-- On 17 February 2015, Motive announced a major update to
TabletTV US that added new functionalities and improved
performance.
-- On 3 March 2015, Motive announced a major update to TabletTV
UK that included One Touch Recording, Home Network, and Social
Networking.
-- On 10 March 2015, the Company announced that a new licensing
agreement had been concluded with Tablet TV LLC and Granite
Broadcasting under which the Joint Venture receives
non-transferable, perpetual, and irrevocable licences for use of
Motive's technology for the territory of the United States and
Canada to be used for the business of Tablet Television and Motive
receives license fees in addition to its ownership of the joint
venture.
-- On 8 April 2015, Motive announced the signing of the first
BYOD TV agreement with Aegean Speed Lines.
-- On 9 April 2015, Motive launched TabletTV Europe to serve travelers to the continent.
-- On 28 April 2015, Motive received approval from the US Patent
office for its datacasting patent, Patent Number 14/358960 entitled
"Methods for Transmitting and Receiving Audiovisual Content".
-- On 5 May 2015, the Company announced a contract with the
Attica Group for BYOD TV services on its 12 ferries carrying over 4
million annual passengers.
-- On 10 June 2015, Motive announced the availability of
TabletTV for Android devices in the United States and the United
Kingdom. Since that date the number of Android operating system
based devices that can use TabletTV has increased each week.
Enquiries:
Motive Television plc T: +44 20 7025 8425
Michael Pilsworth, Chairman
Leonard M Fertig, CEO
Sanlam Securities UK (Nominated T: +44 20 7628 2200
Adviser)
Simon Clements / James Thomas
Beaufort Securities (Company T: +44 20 7382 8300
Broker)
Jon Belliss
Newgate Communications T: +44 20 7680 6559
Jason Nisse/Andre Hamlyn
Media PR Europe T: +44 7774 860011
Gerry Buckland
Brainerd Communicators T: +1 212 986 6667
Chris Plunkett / Mike Smargiassi
Motive Television provides broadcasters and pay television
operators with enabling technology that provides opportunities to
deliver highly valued services to viewers that generate additional
income and retain existing subscribers, comprising:
Content Express(TM)
Today's television viewers are demanding the ability to watch
whatever they want when they want it on any screen, and Motive's
Content Express(TM) makes that possible without having to build new
networks. Content Express(TM) software provides secure delivery and
management of non-linear digital content across any type of
broadcast network to any consumer-facing screen or device. Motive
has deployed it in both single and hybrid distribution systems that
combine broadband access with traditional distribution for an
optimal solution.
Motive's Content Express(TM) solutions platform provides a
one-stop shop for digital terrestrial broadcasters, satellite, DTT
cable pay television platforms, and Internet OTT content providers
to offer new services including: Video on Demand (VOD and SVOD),
Catch-up television, Tablet Television, Targeted advertising for
VOD, Mocast for 4G LTE, Virtual channels and Video2Go.
Tablet TV
With a proprietary app and T-Pod antenna-tuner, tablet owners
around the globe can watch and record all the programming currently
broadcast over digital terrestrial channels. Additionally, Tablet
TV subscribers have the ability to download a selection of
video-on-demand movies and programmes without the need for Internet
access and, when they are connected, use integrated social
networking and access anything available over the Internet.
Motive's content division is:
Motive Television Limited, a Dublin-based award-winning
independent production company that produces factual programmes for
Irish broadcasters. It specializes in live sports production and
sports documentaries and also produces factual and entertainment
series.
Motive Television was founded in London in 2005 and its shares
are quoted on the London Stock Exchange (AIM).
http://www.motivetelevision.co.uk
STRATEGIC REPORT
Business Review
The Chairman's report sets out an overview of the result for the
year.
As noted in the Chairman's report Group Resources were focused
on development activity with over 75% of engineering time being
spent on developing new technologies. More detail regarding
specific developments and the reason for this focus is set out in
the discussion about the Group's overall strategy below.
Future developments are also set out below, explaining how the
Group intends to exploit the current market opportunities together
with a discussion about the Digital Business Environment generally
and the relevance of the Group's Technology.
Finally, the way in which the Group assesses its performance and
how it has performed against key objectives and performance
indicators, together with the principal risks and uncertainties are
also considered.
Strategy
In the 2013 Strategic Report, the Company described its decision
to forgo short term engineering-based contracts and focus on the
development of technology-based products that would be able to take
full advantage of the dramatic changes happening in viewer
consumption of television, both in terms of how people watch, and
in the number of new "screens" on which they watch.
By the end of 2013, Motive had developed its Content Express(TM)
product suite for business-to-business delivery of on-demand
content over any type of network, and had defined the TabletTV
products that would enable Motive to participate in the rapidly
growing market for viewing TV programmes and movies on handheld
devices. With the number of tablet users due to surpass 150 million
in the United States and 20 million in the United Kingdom, and the
growing use of these devices to watch television-not as a second
screen, but as a primary viewing device-it was apparent to Motive
that the development of products that enabled tablet and Smartphone
viewing of content would be the most valuable opportunities for the
Company in the years ahead.
Consequently, Motive made the strategic choice to make 2014 the
"mobile product year" and focused the great majority of its
engineering and financial resources on building and patenting our
mobile products. The Company set a goal to have TabletTV ready to
put in front of consumers in a large and important test market in
the United States (San Francisco, the 6(th) largest television
market) and also similarly in the United Kingdom. This was
particularly challenging due to the complexity of creating novel
products in an ever-changing television environment, however, the
Company succeeded in launching beta versions of both TabletTV US
and TabletTV UK in December 2014.
Since that time, Motive has worked, with input from a range of
early-adopter purchasers of TabletTV in both markets, to improve
the product and add many new features; the latest being the
introduction of initial Android devices which was announced in June
2015. Your Company has succeeded in its product development as our
current product is now getting positive reviews on both sides of
the Atlantic, and is now ready to launch fully in both markets and
additional ones through partnerships with national broadcasters,
telecoms, and other television and entertainment organisations.
Motive's second mobile product is known as BYOD TV,
(Bring-Your-Own-Device) television, which makes it possible to
easily and efficiently watch on-demand and live content on handheld
devices in certain private environments such as ships at sea,
trains, hotels, lounges, etc. The first application of BYOD TV was
through a contract with Twin Peak S. A. of Athens for a maritime
product for ships at sea, particularly passenger ferries, cruise
lines, commercial ships, oil rigs, and yachts. In these
environments, getting content from the Internet is very costly,
terrestrial broadcast non-existent, and Motive's BYOD is a very
economical and attractive solution.
The Company took on the BYOD product development in August 2014,
and by January 2015 had a working prototype. Since April 2015, BYOD
has been deployed on multiple passenger ferries in Greece with Twin
Peak providing the content and Motive providing the technology.
Discussions with multinational ferry and cruise companies in the UK
and United States suggest that the maritime product will be very
valuable due to the flexibility of Motive's solution and the huge
size of the passenger market. Motive will receive engineering fees
for customisation and installation and a share of every passenger
viewing purchase.
A major feature of the Company's continuing strategy is its
business model. Rather than sell one-off engineering and licences
to broadcasters, the Company seeks to obtain upfront payments for
customisation and implementation of its solutions, plus continuing
participation in the added revenues created for our customers.
Motive effectively partners with its customers in the development
and implementation of new sources of revenue. The Company believes
that partnering with our customers not only reduces competitive
risk by staying close to customers, but leads to growing
participatory revenue streams as these new forms of broadcasting
extend to more consumers. Additionally, as Motive is a 30-person
software developer, it is not feasible to think that the Company is
in a position to market leading-edge products to consumers
globally; it is far more economically sensible to partner with
major consumer-facing organisations. We have established such a
partnership in the United States and expect expansion of this
partnership as TabletTV rolls out and expect to do so similarly in
the United Kingdom, Europe, and other regions.
This concentration on building Motive's mobile products in 2014
so that the Company would be ready in 2015 to exploit them, meant
that 2014 was not a year for revenue growth and was instead a year
of investing in our products. Consequently, revenues vs. 2013 were
flat; coming mainly from existing Content Express(TM) customers
while our expenditures were focused on engineering and development
in anticipation of recovering this investment in the years to
come.
Future development
The Company has developed four products during 2014 and early
2015, and while continuing to develop new features for each is
going to market with them during 2015. The four products being
marketed today are:
-- Content Express(TM): Providing TV Anytime Anywhere platform
solutions to broadcasters and satellite pay TV operators to enable
new revenues from video-on-demand, catch-up TV, targeted
advertising, and other features.
-- TabletTV US: Providing viewers in the United States and
Canada with the ability to watch and record television with or
without Internet availability on their tablets and in the future,
on their Smartphones. Also permits simultaneous social networking
when connected to the Internet.
-- TabletTV UK and Europe: Providing viewers in the UK and
Europe with the ability to watch and record television with or
without Internet availability on their tablets and in the future,
on their Smartphones. Also permits simultaneous social networking
when connected to the Internet.
-- BYOD TV: Providing the capability for passengers and crew on
passenger ferries, cruise ships, commercial ships, oil rigs, and
yachts to view video-on-demand, live TV and other services without
need for Internet connection.
Each of Motive's product/solutions has some similar
advantages:
Motive is able to offer broadcasters, telecoms, and ultimately
consumers a very a low-cost way of distributing content that has
been proven successful in large-scale implementation over both
digital terrestrial and satellite networks. With our patented
Datacasting technology, the Company is a leader in "add on" video
on-demand capabilities and the management of non-linear content
delivery.
The customers for Motive's B2B on-demand or non-linear content
solutions are broadcasters and satellite television platforms that
want to enter or upgrade their pay television services. There are
perhaps 5,800 channels, stations, and satellite broadcasters
globally at this time that may be candidates for Motive's
solutions.
The markets for each of our products are vast and global.
Motive's mobile products, namely TabletTV and BYOD, have great
appeal to the growing number of tablet and Smartphone owners and
the potential for growth will only be limited by the Company's
ability to sell and service a worldwide market.
Although each of the four products is now in the market Motive
continues to add new features to its product offering. Among the
future product development efforts underway in 2015 are:
-- Adding tablets based on the Android operating system to
TabletTV in the United States, United Kingdom, and internationally.
The first App release for the most popular Android tablets was
announced on 10 June 2015 and versions for the myriad of other
devices are being added each week.
-- Adding Google Chromecast to TabletTV US so that viewers can
easily transfer the programmes they are watching on their tablet to
a Chromecast enabled television. This is anticipated by July 2015
for both iOS and Android versions of TabletTV US, and will be
supported by a marketing partnership with Google.
-- Adding full PVR/DVR functionality to TabletTV US so that
users will be able to schedule the recording of programmes a week
in advance, and have other convenient functions while viewing them.
The US and UK versions of TabletTV already have one-touch recording
(OTR) to record, pause, play, and fast forward what they are
watching. This is planned for summer 2015.
-- Adding the availability of OTT (over-the-top) Internet
channels to TabletTV such as YouTube, iPlayer, etc., planned for
3(rd) quarter 2015.
-- Adding video-on-demand services to TabletTV, planned for the
4(th) quarter 2015/1(st) quarter 2016.
-- Adding TabletTV apps for smartphones beginning 4(th) quarter 2015.
-- Developing a 4k UHD (ultra-high definition version of Content
Express(TM) for a client planned for 2015/16.
-- Development of specifications and production of new
antenna-tuners for DVBT and DVBT2 TabletTV services for the
European standard that will enhance performance and allow PVR/DVR
and other functionalities not possible with the current
hardware.
The Digital Television Business Environment
It is well known by this time that the television viewing market
is in the process of exceptional change in the United States,
United Kingdom, and worldwide. The shift of viewing from fixed
large screens to handhelds, led by young people, has completely
disrupted the industry, with the major broadcasters, telecoms,
consumer electronics companies and content providers struggling to
find their place in this new world.
Motive Television is prepared. By changing our focus from the
main TV in the home to the mobile screen during 2014, and by
developing industry-leading products and solutions to take part in
this consumer-led industry tsunami, the Company is very well
positioned for the present and future. Motive is in the midst of
the industry storm and our products and software innovations are
the subject of countless discussions as major players seek to find
their way.
There are myriad statistics that are published every day, each
one more surprising. For example,
-- In December 2014 Mail Online reported that 10 million Britons
watch TV on their phones and tablets, tripling the figure of one
year before.
-- According to BI intelligence, by the end of 2013 22% of the
population of the entire world owned a Smartphone, and 6% owned a
tablet.
-- Statista forecasts that in 2015 alone 360 million tablets will be sold worldwide.
-- Presently (2015) there are 156 million tablets in use in the
United States (eMarketer and DRG), which is about 1.3 tablets per
home, or nearly 1 tablet for every two people.
-- In the UK, 25% of the population today own a tablet, and
tablet use grew 63% from 2013 to 2014. By 2017, the forecast is 38
million UK tablet users, or nearly 1.5 per household.
-- Company-commissioned independent research in the United
States revealed that 1 out of 3 tablet owners are highly interested
in TabletTV.
-- Based on all the above, the target market for TabletTV
worldwide by the end of 2018 is 250 million users, considering only
the 33% "highly interested" figure.
Looking at the Company's BYOD business environment and
opportunity, a few more statistics:
-- There are an estimated 3,200 passenger ferries, 426 cruise
ships, 860 Offshore Oil Rigs, and over 1 million yachts who
represent the potential market for the Company
-- Since launching the product in April 2015, the Company and
its content partner Twin Peak S. A. have signed up two operators
with 14 international ferries.
Principal Risks and Uncertainties
With great opportunities as described above in the Strategic
Report there are certainly risks:
1. Size: The Company is small compared to nearly all its
competition and needs cooperation from technology, content,
broadcasting, and other partners to market its solutions to the
consumer. Motive is a B2B company and our customers and partners
are larger and have much bigger balance sheets. Consequently,
Motive is at a disadvantage in its negotiations and contracts and
there are risks of contracts not being paid, patent infringement,
and other inappropriate behaviour by our partners and
customers.
The Company tries to mitigate this risk by using the most
appropriate legal advisers, protecting its intellectual property,
and when possible getting paid up front.
2. Undercapitalisation: Most commonly, a company seeking to
develop and market new solutions such as Motive is privately held
and initially capitalised by venture capitalists with sufficient
funding to carry out its development phase and exploit its
solutions. Motive has not had this luxury and has had to
"bootstrap" its software and product development and marketing
through relatively small tranches of financing. Further, Motive has
found itself competing with Silicon Valley and Asian financed
organisations that are funded 5-10 times of what the Company has to
deploy.
The Company has responded to this situation by raising funds as
it can and by using speed and agility in the marketplace against
better-financed and better-connected competition.
3. Liquidity and Going Concern: As described above, the Company
has not yet reached the point of being able to fund itself out of
operating income, and thus needs to continue raising funds through
equity placings and debt. In 2014, Motive raised GBP1,575,000 in
placings of ordinary shares plus borrowed GBP1,600,000 million from
Bergen Asset Management LLC to fund its operating and financial
costs. To date in 2015, the Company has raised GBP1,000,000 in
equity placings of ordinary shares plus GBP400,000 in debt from
Bergen Asset Management. Until the Company reaches cash
self-sufficiency Motive will continue to need to raise funds to
remain a going concern.
Historically the Company has been consistently able to raise
equity and debt funding as required partly due to the perceived
value of the potential for its patented and patent-applied
technology.
4. Personnel: The Company is dependent upon a relatively small
staff that might be hard to replace. Talented developers and
experts in television technology are greatly in demand in today's
environment and Motive is not immune to the risk of having its best
talent "poached". Further, the Company is not in a position to pay
its team anything close to what they could earn in Silicon Valley,
Silicon Alley, or even London.
Motive's response to this risk has been to gradually add to its
technical staff and to keep its engineering centres in less
competitive locations such as Barcelona and Casablanca where the
Company represents a relatively more attractive opportunity. Also
the Company uses an employee-centric team approach to management
and all key personnel have a stake in success through share
options.
5. Technology Risk: All technology-based companies face the risk
of becoming "yesterday's news", particularly in this era of
open-source solutions and low-cost Asian and third world technology
expertise. The Company cannot be immune to this risk, as it has
troubled every technology-based company to an increasing extent in
the past decade.
The mitigation of this risk has been developed by the more
successful companies in the technology industry in the form of
developing services based on their proprietary technology that tie
in clients and make it less likely that their solutions become
commoditised.
Motive has taken this "software as a service" approach a further
step by effectively investing its solutions with consumer facing
clients in exchange for a piece of their consumer revenues. Because
Motive's business/product strategy is to develop revenue-enhancing
solutions for our customers, the Company has been able to negotiate
"back-end deals" that give Motive continuing shares of subscriber
revenues. This approach not only ties the Company to its clients in
a software-as -a-service, but it creates a partnership as Motive
brings new income to its customers and receives part.
6. Financial risk: In the past, the Directors note that the
Company's share price has been volatile and at times has fallen
below its nominal value. As such movement in the share price could
result in a risk making it more difficult for the Company to raise
capital. In the past this has not created any difficulties and the
Directors are confident that no future difficulties will arise as a
consequence of this volatility. Other financial risks are covered
in Note 3 of the financial statements.
Key Performance Indicators
At this stage in the Group's development the reporting of KPIs
is broadly focused. In particular the Board monitors:
-- Year on year sales growth in turnover of the digital
business; in 2014 the digital business sales decreased as the
Company was focused on product development rather than engineering
sales.
As described in the Chairman's report and earlier in the
Strategy section, Motive made a deliberate decision in early 2014
to focus nearly all its energies and resources on the completion of
the development of TabletTV during calendar year 2014, with the
goal of soft launching this new product by Christmas in the United
States and United Kingdom. This necessarily meant diverting
resources from the traditional business of the Company, Content
Express(TM) . Further, since TabletTV is a consumer revenue-driven
opportunity that would not develop any material income for the
Company until the second half of 2015 at the earliest, this
decision resulted in flat turnover for 2014 vs 2013.
In August 2014, a further decision was made to invest
engineering resources in the development of the Company's second
new product, BYOD TV, for the maritime industry. Again this
investment of resources in 2014 generated no turnover in 2014;
however, the Company anticipates contracts and revenues as a result
of completing development of the BYOD product in 2015. Presently,
contracts have been negotiated that are estimated to generate over
GBP500,000 per annum for Motive from BYOD.
-- Developing a strong suite of industry leading products and
securing IPR protection on them. In 2014, the Company achieved the
development and launch of TabletTV, the upgrade to Content
Express(TM), and developed BYOD TV for the maritime industry.
These KPI's were basically achieved in 2014 as Motive succeeded
in bringing its TabletTV products from development to Beta launch
in December as planned, and completed the technical development of
BYOD TV for launch in early 2015. Patent applications were filed or
in the process of filing for both new technologies in the United
States and Europe with the automatic extension worldwide.
-- That engineering projects are delivered on time; projects
undertaken during the year were delivered on a timely basis. During
2014, the Company hit its two major targets; i.e., getting TabletTV
to beta launch by Christmas and completing BYOD TV. Additionally,
the Company installed and tested Content Express(TM) in South
Africa for Siyaya and supported the Content Express(TM) platform in
Italy for Mediaset and Turkey for Digiturk.
Leonard M Fertig
Chief Executive Officer
On behalf of the Board of Directors
29 June 2015
MOTIVE TELEVISION PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2014
Note Year to Year to
31 December 31 December
2014 2013
GBP GBP
Revenue 1,143,314 1,170,942
Cost of sales (669,463) (510,334)
Gross Profit 473,851 660,608
Administrative expenses (11,240,022) (2,522,386)
Operating loss (10,766,171) (1,861,778)
Analysed as;
Operating loss before
exceptional item (2,764,137) (1,861,778)
Exceptional item - Goodwill
impairment (8,002,034)
------------- ------------
(10,766,171) (1,861,778)
------------- ------------
Financial income 85,061 63,513
Financial costs (1,822,752)
------------
(813,874)
Financial costs - exceptional (117,187) (441,570)
------------------------------- ----- ------------- ------------
Total Financial costs (1,939,939) (1,255,444)
------------- ------------
Loss before tax (12,621,049) (3,053,709)
Tax credit 90,062 45,989
Loss for the year (12,530,987) (3,007,720)
Other comprehensive
income
Exchange differences
on translating foreign
operations 209,046 (58,679)
Total comprehensive
income for the year
attributable to equity
holders of the company (12,321,941) (3,066,399)
============= ============
Loss per share from
continuing operations
- basic and diluted 2 (0.035)p (0.018)p
All other comprehensive income shown above will be reclassified
subsequently to profit and loss when specific conditions are
met.
MOTIVE TELEVISION PLC
STATEMENT OF FINANCIAL
POSITION
as at 31 December 2014
Note 2014 2013
GBP GBP
Non-current assets
Intangible assets 1,379,596 8,740,853
Plant and equipment 19,842 29,036
Total non-current assets 1,399,438 8,769,889
------------- -------------
Current assets
Inventories 20,836 -
Trade and other receivables 329,589 672,939
Cash and cash equivalents 595.608 250,404
Total current assets 946,033 923,343
------------- -------------
Total assets 2,345,471 9,693,232
------------- -------------
Equity
Issued share capital 8,900,299 6,683,954
Share premium 9,551,034 8,640,176
CLN reserve 2,093,392 2,093,392
Merger reserve 155,467 155,467
Foreign exchange reserve 329,102 120,056
Retained earnings (24,844,640) (12,799,419)
Total Equity (3,815,346) 4,893,626
------------- -------------
Current liabilities
Trade and other payables 1,983,671 1,609,765
Borrowings 4,081,092 430,165
Total Current liabilities 6,064,763 2,039,930
------------- -------------
Non- current liabilities
Borrowings 89,758 2,671,091
Other payables 6,296 88,585
Total non-current liabilities 96,054 2,759,676
------------- -------------
Total liabilities 6,160,817 4,799,606
------------- -------------
Total equity and liabilities 2,345,471 9,693,232
------------- -------------
MOTIVE TELEVISION PLC
STATEMENT OF CASH FLOWS
for the year ended 31 December
2014
Note 2014 2013
GBP GBP
Cash flows from operating
activities
Operating loss (10,766,171) (1,861,778)
Adjustments for:
Impairment of Goodwill 8,002,034 -
Depreciation 58,090 66,261
Increase in inventories (20,836) -
Decrease/(increase) in
receivables 302,596 (267,327)
Increase/(decrease) in
payables 321,855 (343,557)
Share based payments 377,000 54,000
Liabilities settled by
issue of shares - 210,956
------------- ---------------
Net cash flows from operating
activities 2 (1,725,432) (2,141,445)
------------- ---------------
Cash flows from investing
activities
Interest received 254 220
Payments to acquire tangible
fixed assets (9,936) (8,994)
Payments to acquire intangible
fixed assets (702,893) (308,972)
Net cash used in investing
activities (712,575) (317,746)
------------- ---------------
Cash flows from financing
activities
Interest paid (250,409) (180,354)
Proceeds from issue of
shares 1,575,000 2,897,489
Costs of issue of shares (138,125) (153,937)
Proceeds from issue of
convertible loans 1,600,000 -
Loan repayments (89,728) (34,233)
Exercise of warrants 58,750 50,000
Payment of earn-out liability (31,290) (17,319)
Withholding tax paid on
CLN interest (28,522) (46,766)
Net cash from financing
activities 2,695,676 2,514,880
------------- ---------------
Taxation
Tax refund received 90,062 45,989
------------- ---------------
Net cash from taxation 90,062 45,989
------------- ---------------
Net increase/(decrease)
in cash and cash equivalents 347,731 101,678
Cash and cash equivalents
at beginning of period 250,404 148,554
Exchange gains and losses
on cash and cash equivalents (2,527) 172
Cash and cash equivalents
at end of period 595,608 250,404
------------- ---------------
MOTIVE TELEVISION PLC
STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2014
Group
Foreign
Share Share CLN Merger exchange Retained Total
capital premium reserve reserve reserve earnings
GBP GBP GBP GBP GBP GBP GBP
At 1 January
2013 4,328,543 6,853,967 2,055,105 155,467 178,735 (9,628,592) 3,943,225
Loss for the
year - - - - - (3,007,720) (3,007,720)
Exchange differences
on translating
foreign operations - - - - (58,679) - (58,679)
---------- ---------- ---------- -------- ---------- ------------- -------------
Total comprehensive
income for the
year - - - - (58,679) (3,007,720) (3,066,399)
Other equity
transactions:
Shares issued
for cash 1,710,210 1,132,279 - - - - 2,842,489
Shares issued
in settlement
of liabilities 123,786 182,794 - - - - 306,580
Issue costs - (153,937) - - - - (153,937)
Shares issued
to pay Fixed
interest CLN
interest 24,163 12,081 - - - - 36,244
Equity reserve
on Fixed interest
CLN issue - - 38,287 - - - 38,287
Shares issued
on exercise of
warrants 33,333 16,667 - - - - 50,000
Shares issued
to acquire Fixed
interest CLNs 463,919 596,325 - - - - 1,060,244
Release of equity
reserve on pre
maturity acquisition
of Fixed interest
CLNs - - - - - (186,057) (186,057)
Fixed interest
CLN issue costs - - - - - (31,050) (31,050)
Cost of share
based awards - - - - - 54,000 54,000
At 31 December
2013 6,683,954 8,640,176 2,093,392 155,467 120,056 (12,799,419) 4,893,626
Loss for the
year - - - - - (12,530,987) (12,530,987)
Exchange differences
on translating
foreign operations - - - - 209,046 - 209,046
---------- ---------- ---------- -------- ---------- ------------- -------------
Total comprehensive
income for the
year - - - - 209,046 (12,530,987) (12,530,987)
Other equity
transactions:
Shares issued
for cash 1,002,885 572,115 - - - - 1,575,000
Shares issued
in settlement
of liabilities 60,000 5,678 - - - - 65,678
Issue of warrants - - - - - 108,766 108,766
Issue costs - (138,125) - - - - (138,125)
Shares issued
on conversion
of Other CLNs 1,114,294 451,606 - - - - 1,565,900
Shares issued
on exercise of
warrants 39,166 19,584 - - - - 58,750
Cost of share
based awards - - - - - 377,000 377,000
At 31 December
2014 8,900,299 9,551,034 2,093,392 155,467 329,102 (24,844,640) (3,815,346)
---------- ---------- ---------- -------- ---------- ------------- -------------
1 GENERAL INFORMATION
Motive Television plc and its subsidiaries provide software and
services to the television industry.
This preliminary announcement is authorised for issue by the
Board on 29 June 2015. The financial information has been prepared
in accordance with International Financial Reporting Standards
adopted by the European Union and applying the same accounting
policies and bases of calculation and estimation as applied in
previous annual financial statements.
Going concern assumption
The financial statements have been prepared on a going concern
basis which assumes that the Company will have sufficient funds
available to enable it to continue to trade for the foreseeable
future.
In making their assessment that this assumption is correct the
Directors have undertaken an in depth review of the business, its
current prospects, cash resources and borrowings and potential
liabilities to the Put and Call arrangement as set out below.
The Directors have also considered the likely sales, contracts
and announcements that the Company anticipate being able to make
over the coming months, the current share price, levels of trading
in the Company's shares and past history of raising funds and have
had a number of conversations with the Company's Brokers.
During 2014, Motive raised GBP1,575,000 (2013: GBP2,842,489) in
placings of ordinary shares (before costs) plus borrowed
GBP1,600,000 (2013: GBPnil) from Bergen Asset Management LLC to
fund its operating and financial costs. To date in 2015, the
Company has raised GBP1,000,000 in equity placings (before costs)
of ordinary shares plus GBP400,000 in debt from Bergen Asset
Management LLC.
The Company's Fixed Interest CLNs with a face value of
GBP2,978,396 mature in December 2015. The Company has entered into
discussions with the largest of the holders of these CLNs which
represent 47% of the amount outstanding. These holders are prepared
to extend the term of their loans subject to terms being agreed and
it is anticipated the remaining holders will be prepared to agree
similar terms.
As set out below, the Company has been involved in a dispute
relating to a Put agreement entered into on the acquisition of
Motive Television S.L. Currently the other party have agreed in
principle that they will settle this dispute if they receive
payment of EUR750,000, however formal terms have not yet been
signed. Further details regarding the negotiation and settlement of
the put and call option agreement are included later in this
note.
Currently the Company has net current liabilities and is not
forecast to generate net operating cash inflows until mid-2016.
Therefore, the Company anticipates a need for further funding, both
during the next three months, to fund trading and working capital
requirements, and at a further stage, or stages, dependent on
future trading and the outcome of the Fixed Interest CLN extension
negotiations and the settlement of the legal dispute outlined
above. After taking account of all the above factors the Directors
believe that as the market becomes more aware of the Company'
prospects and the scale of the opportunities that the Company's
technologies create the Company will continue to be able to raise
the funds required to enable it to continue to trade and grow
towards self-sufficiency.
If the Company were unable to raise the funds required to meet
its trading requirements and settle any liability to the Put, or is
unable to agree terms with the holders of the CLNs the Company may
be unable to realise its assets and discharge its liabilities in
the normal course of business.
These conditions indicate the existence of material
uncertainties which may cast significant doubt about the Group's
ability to continue as a going concern. The financial statements do
not include the adjustments that may be required if the Group was
unable to continue to trade.
2 LOSS PER SHARE
The loss per share is based on a loss for the year attributable
to equity holders of the Parent Company of GBP12,530,987 (2013:
GBP3,007,720) and the weighted average number of ordinary shares in
issue for the year of 34,964,624,102 (2013: 16,993,913,840).
The exercise of the outstanding options and warrants would
reduce the loss per share and hence have an anti-dilutive effect.
Shares issued after the year end would also reduce the loss per
share and hence have an anti-dilutive effect.
There are 9,170,899,571 (2013: 2,586,149,571) shares that could
potentially be issued under the terms of options and warrants as
described in notes 18 and 24 in the full financial statements
included in the report and accounts that will potentially reduce
future earnings per share.
3 STATUS OF FINAL AUDITED RESULTS
The financial information presented in this announcement has
been extracted from the Group's audited statutory accounts for the
year ended 31 December 2014 which will be delivered to the
Registrar of Companies. The auditor's report for 2014 was
unqualified and did not contain statements under the Companies Act
2006, s498(2) or (3). However the audit report for the years ended
31 December 2013 and 2014 drew attention to an emphasis of matter
due to the uncertainty over going concern, further details are
included in Note 1 above. The statutory accounts for the year ended
31 December 2013 have been delivered to the Registrar of
Companies.
The financial information presented in this announcement of
final audited results does not constitute the Group's statutory
accounts for the year ended 31 December 2014.
4 DIVIDEND
The Directors will not be recommending the payment of a
dividend.
5 COPIES OF THE REPORT AND ACCOUNTS
Copies of the Annual Report and Accounts will be available from
the Company's registered office, 18 Soho Square, London W1D 3QL and
the Company's website http://www.motivetelevision.co.uk. Hard
copies will be posted to shareholders today.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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