TIDMMBW
RNS Number : 3679S
Mobilewave Group PLC
30 November 2012
MobileWave Group Plc
("MobileWave" or the "Company")
Unaudited Interim Results
for the period ended 31 August 2012
Chairman's Statement
I am pleased to present the interim results for MobileWave Group
plc for the period ended 31 August 2012.
The period under review has remained an extremely challenging
one for the Company. We had, as previously reported to
shareholders, signed a convertible preference share investment
agreement with a Singapore based investor. While this investment
contract contained no conditional clauses, the nature of the
investors trading business required that in order for them to have
sufficient funds to make the investment into the Company, they
needed to complete a substantial transaction that they are involved
in prior to making the investment into MobileWave. This transaction
is, at the time of writing, still to complete. In late August, I
temporarily relocated to Asia to work alongside the Singapore based
investor in seeking to complete the transaction. This has been a
positive move as the Board is now extremely well informed as to the
status of the transaction and the resulting investment into the
Company. The Board remains positive that a beneficial outcome for
MobileWave Group plc is likely.
Review of Operations
The shortage of funding has been limiting in allowing the
Company to move forward operationally. The company was unable to
close the proposed acquisition of Ariose Software during the period
under review and indeed, given the time that has elapsed since
originally signing this agreement, will need to renegotiate this
acquisition once the Company has received the contracted for
funding. I have been in regular communication with Amit Goenke of
Ariose Software throughout the period under review and a strong
relationship exists between the parties who remain committed to
working closely together.
People
At the beginning of April, Kurt Pakendorf left the company and I
assumed full executive responsibility. While my time has by
necessity been spent on fund raising and other financial issues,
significant time and energy has been spent by the Board on
continuing to analyse and update the strategy and business plan of
the Company. The board are convinced that the strategy is
appropriate and with further funding the strategy can be
accelerated so as to share in the fantastic growth of the smart
phone industry. Potential acquisition targets are often considered
and discussed and shareholders will be informed about these at the
appropriate time.
Litigation update
The company would not be in the difficult financial position
that it is in, had Devin Narang fulfilled his commitment to pay the
final tranche of the Freeplay Energy purchase price. We have
aggressively pursued Mr Narang for payment of this debt both in the
UK and Indian courts. As shareholders are aware, the Company
obtained a High Court judgement against Mr Narang in the amount of
GBP1,070,000. Application was made in the High Court of India for
execution of the judgement in India, under the treaty that exists
between the two countries. Separately but in parallel, the Company
has applied to the UK courts for Mr Narang to be made bankrupt in
the UK. A court date early in the newyear is expected. In tandem
with aggressive legal action, the Company has always sought to find
a negotiated settlement with Mr Narang. To this end, I met with Mr
Narang in Kuala Lumpur, Malaysia on 24 November. The meeting, which
was without prejudice on both sides, was cordial and constructive
and the Board is hopeful that a realistic payment schedule will be
received early in the new year and prior to the court date. Until
an agreement is in place, legal action will proceed.
Financial Review
MobileWave Group PLC has not traded during the period to 31
August 2012, other than incurring expenditure in raising funds,
maintaining the administrative functions of the company and
considering investment opportunities . We continue to drive cost
out of the business during this difficult period and we have
reduced administrative expenses to $523,000 for the period (period
to August 31 2011 $953,000 year to 28 February 2012 $1,908,000).
Cash flow is a significant issue for the Company whilst we await
investor funding and the Narang settlement and the company was
predominately financed via shareholder loans during the period.
Outlook
Shareholders have had to be very patient as the Company has
continued to deal with significant funding related issues. The
Board acknowledges this fact and reiterates its optimism that, upon
receipt of fresh funding, the Company will be well placed to move
decisively forward.
Rory Stear
Chairman
30 November 2012
For further information, please contact:
MobileWave Group plc rstear@mobilewave.com
Rory Stear, Chairman
Charles Stanley Securities 020 7149 6000
Nominated Adviser & Broker
Dugald J. Carlean / Carl Holmes
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the period ended 31 August 2012
6 months 6 months
ended ended 12 months ended
31 August 31 August 28 February
2012 2011 2012
(Unaudited) (Unaudited) (Audited)
US$000 US$000 US$000
Notes
Revenue - - -
Cost of sales - - -
Gross profit - - -
Administrative expenses
(before
separately identifiable
costs) (523) (953) (1,908)
Separately identifiable
costs - - (1,566)
Loss from operations (523) (953) (3,474)
Finance expenses (69) (31) (112)
Finance income - - -
--------------------------------------- --------------------------------------- ---------------------------------------
Loss before taxation (592) (984) (3,586)
--------------------------------------- --------------------------------------- ---------------------------------------
Taxation - - -
--------------------------------------- --------------------------------------- ---------------------------------------
Loss for the period
attributable
to the equity holders
of the
parent (592) (984) (3,586)
========================================= ========================================= =========================================
Other
comprehensive
income,
net of tax
Currency translation
difference - (11) (20)
--------------------------------------- --------------------------------------- ---------------------------------------
Other comprehensive
income - (11) (20)
--------------------------------------- --------------------------------------- ---------------------------------------
Total comprehensive
expense
for the period
attributable
to the equity holders
of the
parent (592) (995) (3,606)
========================================= ========================================= =========================================
US$ US$ US$
Basic and fully diluted
loss
per share 1 (0.005) (0.01) (0.04)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 31 August 2012
6 months 6 months
ended ended 12 months ended
31 August 31 August 28 February
2012 2011 2012
(Unaudited) (Unaudited) (Audited)
US$000 US$000 US$000
Assets
Non-current assets
Intangible assets 59 1,647 59
Property, plant and equipment 4 16 6
63 1,663 65
Current assets
Trade and other receivables 53 96 42
Cash and cash equivalents 2 30 104
Total current assets 55 126 146
Total assets 118 1,789 211
Equity
Share capital 15,110 15,426 15,101
Share premium 29,333 28,761 29,289
Preference shares 129 129
Merger reserve (1,047) (1,047) (1,047)
Other reserves 60 60 60
Foreign currency translation
reserve (23) (14) (23)
Share based payment reserve 351 1,278 351
Retained losses (46,832) (44,568) (46,240)
Total equity attributable
to the owners of the parent
company (2,919) (104) (2,380)
Current liabilities
Trade and other payables 2,730 1,893 2,284
2,730 1,893 2,284
Non-current liabilities
Debt element of preference
shares 271 - 271
Accrued preference share
interest 36 - 36
------------------ ------------------ ------------------
307 - 307
------------------
TOTAL EQUITY AND LIABILITIES 118 1,789 211
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period ended 31 August 2012
Share Share Preference Merger Share Share Foreign Retained Total
Capital Premium Shares Reserve Warrant based currency Deficit
Account Reserve payment translation
reserve reserve
US$000 US$000 US$000 US$000 US$000 US$000 US$000 US$000 US$000
At 28 February
2011 15,051 28,761 - (1,047) 60 1,278 (3) (43,584) 516
Loss for the
period - - - - - (984) (984)
Other
comprehensive
income:
Currency
translation
difference - - - - - - (11) - (11)
---------------- -------------- --------------- ----------- -------------- -------------- ----------------- -------------- -------------
Total
comprehensive
expense for
the period - - - - - - (11) (984) (995)
Issue of
shares 375 - - - - - - 375
----------------- -------------- -------------- ------------ -------------- ---------------- ------------------ ----------------- ----------------
At 31 August
2011 15,426 28,761 - (1,047) 60 1,278 (14) (44,568) (104)
Loss for the
period - - - - - - - (2,602) (2,602)
Other
comprehensive
income:
Currency
translation
difference - - - - - - (9) - (9)
---------------- -------------- --------------- ------------ -------------- ----------------- ----------------- ----------------- ----------------
Total
comprehensive
expense for
the period - - - - - - (9) (2,602) (2,611)
Issue of
ordinary
shares incl
prior period
correction (325) 528 - - - - - - 203
Issue of
preference
shares - - 129 - - - - - 129
Share based
compensation - - - - - 3 - - 3
Transfer due
to lapsed
options - - - - - (930) - 930 -
----------------- -------------- --------------- ------------ -------------- ---------------- ----------------- ---------------- ----------------
At 28 February
2012 15,101 29,289 129 (1,047) 60 351 (23) (46,240) (2,380)
Loss for the
period (592) (592)
---------------- ---------------- ---------------- -------------- ---------------- ----------------- ----------------- ----------------- ---------------
Total
comprehensive
expense for
the period (592) (592)
Issue of
ordinary
shares 9 44 53
---------------- ---------------- ---------------- -------------- ---------------- ----------------- ----------------- ----------------- ----------------
At 31 August
2012 15,110 29,333 129 (1,047) 60 351 (23) (46,832) (2,919)
============ ============ ============ ============ ============ ============ ============ ============ ===========
CONSOLIDATED CASH FLOW STATEMENT
For the period ended 31 August 2012
6 months 6 months
ended ended 12 months ended
31 August 31 August 28 February
2012 2011 2012
(Unaudited) (Unaudited) (Audited)
US$000 US$000 US$000
Cash flow from operating activities
Loss for period before tax (592) (984) (3,586)
Adjustments for:
Finance cost 47 31 112
Share based payment expense - - 3
Depreciation 2 5 37
Impairment - - 1,566
Changes in working capital
(Increase)/decrease in inventory,
accrued income, trade and other
receivables (11) (30) 24
Increase in trade and other payables 225 338 508
------------------------ ------------------------ ------------------------
Cash used in operating activities (329) (640) (1,336)
Income taxes credit received - - -
------------------------ ------------------------ ------------------------
Net cash used in operating activities (329) (640) (1,336)
------------------------ ------------------------ ------------------------
Cash flows from financing activities
Issue of preference share capital - 375 400
Proceeds from the issue of shares 53 - 578
Increase in shareholder loans 174 301 477
------------------------ ------------------------ ------------------------
Net cash outflow from financing
activities 227 676 1,445
------------------------ ------------------------ ------------------------
Net decrease in cash and cash equivalents (102) 36 119
Cash & cash equivalents at the beginning
of the financial period 104 5 5
Effect of foreign exchange rate changes (11) (20)
------------------------ ------------------------ ------------------------
Cash & cash equivalents at the end
of the financial period 2 30 104
================ ================ ================
NOTES TO THE FINANCIAL STATEMENTS
For the period ended 31 August 2012
GENERAL INFORMATION
The Group's results are made up to 31 August 2012.
The interim financial information for MobileWave Group plc is
presented in US Dollars and all values are rounded to the nearest
thousands of dollars (US$000) except when otherwise indicated.
The company is a limited liability company incorporated in
England & Wales whose shares are listed on the London AIM Stock
Exchange.
The interim report was approved for issue by the Board of
Directors on 29 November 2012.
BASIS OF PREPARATION
The financial information contained in this interim report does
not constitute statutory accounts as defined in section 434 of the
Companies Act 2006. It does not therefore include all the
information and disclosures required in the annual financial
statements and should be read in conjunction with the Group's
financial statements for the period ended 28 February 2012.
The financial information for the 6 months ended 31 August 2011
is also unaudited.
The Group's statutory accounts for the period ended 28 February
2012 have been delivered to the Registrar of Companies. The report
of the auditors on these accounts contained a matter of emphasis in
respect of going concern basis of preparation.
GOING CONCERN
The Directors of MobileWave Group plc have prepared these
interim results on a going concern basis, which assumes the Group
will continue in operational existence for the foreseeable future.
The Group's ability to meet its future funding and working capital
requirements, and therefore continue as a going concern, is
dependent upon being able to generate further investment funding,
additional shareholder loans and continuing agreement from its
major creditors to defer payment of their debt. The Directors have
prepared projected cash flow information for the period ending 12
months from the date of approval of these interim results.
On the basis of these projections, the Directors have identified
the requirement to obtain further shareholder funding and it was
announced on 31 July 2012 that Rory Stear, Executive Chairman and
major shareholder had agreed further funding of US$ 150,000.00 and
negotiations have also been commenced with other major
shareholders. Current indications are that these will come to a
satisfactory conclusion. Agreement of further investment would,
based upon projections prepared by the Group, enable it to continue
to meet its debts as they fall due for at least the next 12 months.
As at the date of these interim results, however, there remains
material uncertainty over the timing and success of these
matters.
Should further investment not be secured or trading activities
not meet anticipated targets, then the Group may be unable to
realise its assets and discharge its liabilities in the normal
course of business. Whilst there is a material uncertainty in
relation to the timing and completion of the above matters, the
Directors are continuing their negotiations with various parties
and, based on indications so far, anticipate a positive outcome and
consider that it is appropriate that the financial statements be
prepared on a going concern basis.
SIGNIFICANT ACCOUNTING POLICIES
In accordance with AIM Rules, the interim report has been
prepared using accounting policies consistent with those followed
in the preparation of the Group's financial statements for the
period ended 28 February 2012.
1 LOSS PER SHARE
6 months ended 31 August 6 months ended 31 August 12 months ended 28 February
2012 2011 2012
(Unaudited) (Unaudited) (Audited)
US$000 US$000 US$000
Loss for period (592) (984) (3,586)
Average number of
ordinary shares in issue 112,411 79,113 82,209
US$ US$ US$
Loss Per Share:
Basic loss per 5p
ordinary share (in US$) (0.005) (0.01) (0.04)
Diluted loss per 5p
ordinary share (in US$) (0.005) (0.01) (0.04)
The calculation of the basic and diluted loss per ordinary share
of 0.5 cents (period to 28 February 2012: 4 cents) each has been
based on the loss for the relevant financial period and on
112,410,855 shares (period to 28 February 2012: 82,209,000 shares).
This represents the weighted average number of ordinary shares in
issue. The loss for the year from continuing operations and the
weighted average number of ordinary shares for the purposes of
calculating the diluted loss per share from continuing operations
are the same as for the basic loss per share calculation. This is
because the outstanding share options and convertible preference
shares would have the effect of reducing the loss per ordinary
share and are therefore not dilutive.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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