31AUGUST 2007
ADWALKER PLC
("ADWALKER" OR "THE COMPANY")
PRELIMINARY RESULTS
FOR THE YEAR ENDED 28 FEBRUARY 2007
The Board of Adwalker, the AIM listed specialist in wearable media solutions,
is pleased to announce its final results for the year ended 28 February 2007.
The Adwalker mobile out-of-home, interactive media platform is an advertising
and media platform which is worn by its operators ('Adwalkers') as a compact
body pack incorporating a LCD screen, wearable computer, touch screen and
printer, enabling services and applications which include brand advertising,
point-of-sale, data capture and promotions.
HIGHLIGHTS
* Turnover for the year up 155% to Euro1,599,645(2006: Euro627,639);
* Adwalker makes US network television debut on "The Apprentice";
* Twoyear co-marketing agreement with eMusic.com Inc;
* Appointment as an IBM Business Partner;
* May Placing raises �510,000, before expenses;
* Undertaking campaigns to sign up consumer trialists on behalf of two well
known UK Music and DVD film rental companies;
* Pilot underway for Interactive Screen Network with Global FMCG Group; and
* Turnover in the first 6 months of the current fiscal year up by 64%compared
with corresponding period in 2006.
Commenting on today's results Adwalker's Chairman, Padraic O'Connor, said: "
Adwalker continues to target blue chip marketing, advertising and media clients
primarily within the UK and USA. In addition, the Board anticipates that the
recent demand from our existing clients to develop digital consumer
communication solutions beyond our wearable Adwalker platform will continue and
this is an area the Company will pursue with vigour.
"Our progress in the current year is in line with management expectations and
consequently the Board looks forward to the future with confidence."
--ENDS--
Enquiries:
Adwalker plc Tel: +353 (1) 866 9000
Simon Crisp
www.adwalker.com
Bishopsgate Communications Ltd. Tel: 020 7562 3350
Dominic Barretto Mobile: 07930 450 156
Sophie Davis
www.bishopsgatecommunications.com
John East & Partners Limited Tel: 020 7628 2200
Simon Clements/ David Worlidge
www.johneastpartners.com
Chairman's Statement
I am pleased to report the annual results for the year ended 28 February 2007,
the second set of results since the Company's shares were admitted to trading
on AIM on 2 August 2005. It has been a year of growth for the Company that has
seen a continued adoption of the Adwalker platform for customer campaigns
across Europe and North America. The Board is encouraged by the progress made
in the year and since the year end.
Financials
Turnover for the year was Euro1,599,645 (2006: Euro627,639). The diluted loss per
share amounted to Euro1.80 cents (2006: Euro1.92 cents). At 28 February 2007 cash at
bank amounted to Euro109,738 and on 24 May 2007 the Company raised Euro750,000,
before expenses, through a placing of 5.1 million new ordinary shares.
The Company has made significant investment in the operating offices in
Ireland, United Kingdom and the USA during the period.
Current Trading and Prospects
Growing the business in North America and Europe, specifically the UK and
Ireland, remains the focus of the Company's medium term strategy. Turnover in
the first six months of the current fiscal year has increased by 64 per cent.
compared to the corresponding period in 2006. The growth in turnover in the
first half of the current year was predominately derived from trading activity
in the USA, the world's largest media spending marketplace. The Board believes
the strategy to invest in Adwalker's USA operations over the past two years are
increasingly justified as the list of clients utilising the Adwalker platform
continues to grow.
The investment made in the Company's technology and people has enabled it to
expand the market in which the Adwalker platform's interactive digital services
and applications can be applied. As a direct result, some of our existing
clients are increasingly demanding a range of solutions which include software
and digital network development. The Company's recent announcements have
highlighted business relationships with IBM and a major Fast Moving Consumer
Goods ("FMCG") company which is a significant testimonial for the Company.
The Board believes the continued adoption of Adwalker's wearable technology and
the additional requirement for other digital services and related solutions
across a broader spectrum of platforms, such as fixed interactive digital
screen solutions, will increase shareholder value in the medium to long term.
The Board hopes to update shareholders on the progress of the FMCG Digital
Screen pilot by the end of the calendar year.
Strengthened Client List
The Board has observed strong regional variances in the adoption of the
platform across Europe and the USA. In the USA 88 per cent. of Adwalker
campaigns are booked through major advertising agency and media buying networks
on behalf of their clients. In the UK just 29 per cent. of campaigns are booked
through the same networks with the majority of turnover being generated
directly with clients. In the short term the Board believes this trend will
continue and the adoption of the Adwalker platform will be faster in the USA as
a result.
In the first six months of the current financial year 81 per cent. of
advertising agency and media buying networks that have booked the Adwalker
platform on behalf of their clients have been repeat users.
The Adwalker client list over the last 18 months has included Verizon, Hasbro,
Millennium Hotels, Heineken, Suzuki, Mattel Guinness, Castrol, Unilever,
Telemundo, Sears, Dos Equis, Jameson, Waitrose, Muller and BT.
The Board believes the majority of results achieved from our client campaigns
continue to match or exceed those of our media peer group. Recent results for a
major retailer generated over USD$250,000 worth of average sales per day and
the campaign spend was USD$150,000.
Technology Update
The Adwalker platform offers clients, derived predominantly from marketeers as
well as advertising and media networks, the ability to connect with their
consumers in an engaging and interactive way. Additional features including,
content transfers to mobile devices using Bluetooth technology, Adwalker's
Point of Sale solution, digital photo capture and transfer have been utilised
by clients in the period under review.
Access Agreements
Adwalker has exclusive access to key locations within the USA and UK. Landlord
deals with key USA shopping malls have been strengthened over the period as the
number of client campaigns has increased, particularly in Simon Malls
properties, the largest shopping mall owner in the USA.
The Board anticipates that the number of clients seeking to undertake campaigns
utilising these access deals in retail locations, in the UK and USA, will
continue to increase in the current year.
The Company still retains exclusive access to certain BAA Airports and
premiership rugby and football grounds across the UK.
Marketing
In February 2007 the Adwalker platform was successfully featured in an episode
of the USA version of The Apprentice, hosted by Donald Trump.
The success of the Adwalker platform, in generating ticket sales for NBC
Universal Theme Parks, within the programme, exposed the Company to around 18
million American viewers and the Board believe this has directly contributed to
our increased success in the USA.
Other Developments
In February 2007 Adwalker conducted research which determined that consumers
were willing to access music and film content with digital devices beyond
laptops and PC's. Since the completion of this research and the introduction of
Adwalker's solution whereby customers can be provided with instant music and
video downloads direct to their portable digital audio and video players from
an Adwalker unit, the Company have been developing the service on behalf of a
number of clients.
Adwalker is currently undertaking specific campaigns to sign up consumer
trialists on behalf of two well known Music and DVD film rental companies in
the UK. The Board anticipates this campaign will generate significant revenues
in the last quarter of 2007 and the first quarter of 2008.
Outlook
Adwalker continues to target blue chip marketing, advertising and media clients
primarily within the UK and USA. In addition, the Board anticipates that the
recent demand from our existing client's to develop digital consumer
communication solutions beyond our wearable Adwalker platform will continue and
this is an area the Company will pursue with vigour.
The Board continues to believe that Adwalker is still working with clients who
represent innovators and early adopters within their respective business
disciplines.
Our progress in the current year is in line with management expectations and
consequently the Board looks forward to the future with confidence.
PADRAIC O'CONNOR
CHAIRMAN
31 AUGUST 2007
Consolidated Balance Sheet at 28 February 2007
28th February 28th February
2007 2006
Euro Euro
Assets
Non-current assets
Plant and equipment 609,973 1,081,117
Intangible assets 339,642 470,370
949,615 1,551,487
Current assets
Inventories - 5,390
Trade and other receivables 234,552 516,604
Bank and cash balances 109,738 1,892,892
344,290 2,414,886
Total assets 1,293,905 3,966,373
Equity and liabilities
Capital and reserves
Share capital 3,372,664 3,372,664
Capital reserves 5,392,689 5,392,689
Other reserve (8,519) -
Share Options 493,410 434,684-
Accumulated losses (9,188,848) (6,010,316)
Total equity 61,396 3,189,721
Non current liabilities
Obligations under finance leases - due 63,509 101,405
after one year
63,509 101,405
Current liabilities
Trade and other payables 886,296 584,413
Bank overdrafts and loans- due within 98,139 28,805
one year
Tax liabilities
Obligations under finance leases - due 38,736 38,815
within one year
1,169,000 675,247
Total equity and liabilities 1,293,905 3,966,373
Consolidated Income Statement for the year ended 28 February 2007
Notes Year ended Year ended 28th
28th February February 2006
2007
Euro Euro
Revenue - continuing operations 1,599,645 627,639
Cost of sales (1,149,190) (328,608)
Gross profit 450,455 299,031
Distribution costs (24,727) (14,265)
Administrative and other operating (3,624,733) (3,154,575)
expenses
Loss from operations - continuing (3,199,005) (2,869,809)
operations
Finance costs (3,832) (6,175)
Income from investments 36,448 8,006
Exchange (loss)/profit (20,756) 25,368
Loss before tax - continuing operations (3,187,145) (2,842,610)
Income tax expense 8,613 -
Net loss for the year - continuing (3,187,145) (2,842,610)
operations
Loss per share
Basic loss per share (1.88 cent) (1.92 cent)
Diluted loss per share (1.80 cent) (1.92 cent)
Consolidated Statement of Changes in Equity for the year ended 28 February 2007
Share Share Share Accumulated Total equity
Capital Premium Options Losses
Euro Euro Euro Euro Euro
Balance at 1 March 2,372,664 1,366,304 - 2,941,334 797,634
2005 (as reported)
Share Options Granted - - 226,372 226,372 -
Balance at March 2005 2,372,664 1,366,304 226,372 (3,167,706) 797,634
(as restated)
Net loss for the year - - - (2,842,610) (2,842,610)
Share Options Granted - - 208,312 - 208,312
Shares Issued 1,000,000 4,026,385 - - 5,026,385
Balance at 1 March 3,372,664 5,392,689 434,684 (6,010,316) 3,189,721)
2006 (as reported)
Share Options Granted - - - - -
Balance at 1 March 3,372,664 5,392,689 434,684 (6,010,316) 3,189,721
2006 (as restated)
Net loss for the year - - - (3,178,532) (3,178,532)
Share Options Granted - - 58,726 - 58,726
Shares Issued - - - - -
Balance at 28 February 3,372,664 5,392,689 493,410 (9,188,848) 69,915
2006
Consolidated Cash Flow Statement for the year ended 28 February 2007
Year ended Year ended
28 February 28 February
2007 2006
Euro Euro
Operating activities
Net loss for the year (3,178,532) (2,842,610)
Adjustments for:
Income taxation expense recognised (8,613) -
Depreciation 553,255 384,061
Share options 58,726 208,312
Amortisation of ACOMS systems and patent 152,633 124,262
Investment income (36,448) (8,006)
Foreign exchange gain (20,756) (25,368)
Interest expense 3,832 6,175
Operating cash flows before movements in working (2,475,903) (2,153,174)
capital
Decrease/(Increase) in inventories 5,390 (1,134)
Decrease/(Increase) in receivables 282,052 (442,506)
Increase in payables 423,044 311,199
Cash generated by operations (1,765,417) (2,285,615)
Interest paid (3,832) (6,175)
Income taxation 1,251 -
Net cash outflow from operating activities (1,767,998) (2,291,790
Investing activities
Interest received 36,448 8,006
Purchases of plant and equipment and ACOMS (82,111) (1,214,000)
Purchases of patents and trademarks (21,905) (27,892)
Net cash used in investing activities (67,568) (1,233,886)
Financing activities
Shares issued - 5,026,385
(Decrease)/Increase in finance leases (37,678) 139,923
Net cash (outflow)/inflow from financing (37,678) 5,166,308
activities
Net (decrease)/(increase) in cash and cash (1,873,244) 1,040,632
equivalents
Cash and cash equivalents at beginning of period 1,864,087 198,087
Effects of exchange rate changes 20,756 25,368
Cash and cash equivalents at end of year 11,599 1,864,087
Operating activities
Net loss for the year (2,587,044) (3,204,639)
Adjustments for:
Income taxation expense recognised (8,613) -
Depreciation 532,285 374,329
Share options 58,726 208,312
Provision 542,117 1,264,069
Amortisation of ACOMS system and patents 152,633 124,262
Investment income (35,111) (7,884)
Interest expense 3,832 6,175
Operating cash flows before movements in working (1,341,175) (1,235,376)
capital
Decrease/(Increase) in inventories 5,390 (1,134)
Decrease/(Increase) in receivables (466,308) (1,248,152)
Increase in payables 77,214 117,667
Cash generated by operations (1,724,879) (2,366,995)
Interest paid (3,832) (6,175)
Income tax refunded 1,251 -
Net cash outflow from operating activities (1,727,460) (2,373,170)
Interest received 35,111 7,884
Purchases of plant and equipment (78,347) (1,136,970)
Purchases of patents and trademarks (21,905) (27,894)
Net cash used in investing activities (65,141) (1,156,980)
Financing activities
Shares issued - 5,026,385
(Decrease)/Increase in finance leases (37,678) 139,923
Net cash from financing activities (37,678) 5,166,308
Net increase/(decrease) in cash and cash (1,830,279) 1,636,158
equivalents
Cash and cash equivalents at end of year 1,833,748 197,590
Bank balances and cash 3,469 1,833,748
Notes to the preliminary Results
1. PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in Section 240 of the Companies Act
1985.
The consolidated balance sheet at 28 February 2007 and the consolidated income
statement, consolidated cash flow statement and associated notes for the year
then ended have been extracted from the Company's financial statements. Those
financial statements, on which the auditors have reported an unqualified
opinion, have not yet been delivered to the Companies Registration Office.
2. INCOME TAX AND EXPENSE
Domestic income tax is calculated at 12.5% of the estimated assessable profit
for the year.
Taxation for other jurisdictions is calculated at the rates prevailing in the
respective jurisdictions.
Year ended 28 year ended 28
February 2007 February 2006
Income tax expense (8,613) -
3. LOSS PER ORDINARY SHARE
Basic loss per share is based on a loss of Euro3,178,532 (2006: Euro2,842,610) and a
weighted average number of shares in issue of 168,633,087 (2005: 147,799,754).
In 2006 the diluted loss per share has been calculated on the same basis as
basic loss per share because the effect of the potential ordinary shares (share
options) reduces the net loss per share and is therefore anti-dilutive.
4. DIVIDENDS
The Directors are not proposing the payment of a dividend in respect of the
year ended 28 February 2007.
5. Copies of REPORT AND ACCOUNTS
Copies of the Report and Accounts will be sent to shareholders today and will
be available to members of the public from the Company's registered office,
Crescent Building, Northwood, Santry, Dublin 9.
END
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