TIDMMPAY
RNS Number : 3764K
Mi-Pay Group PLC
21 September 2016
21 September 2016
This announcement contains inside information
Mi-Pay Group plc
('Mi-Pay', the 'Group', or the 'Company')
Interim Results
Mi-Pay (AIM: MPAY), the leading provider of outsourced and fully
managed digital transformation and mobile payment solutions to Tier
1 Mobile Network Operators and Mobile Virtual Network Operators, is
pleased to present its unaudited Interim Results for the six months
ended 30 June 2016.
Operational Highlights
-- During the period we were the first provider to deliver
Amazon Payments as a Mobile Wallet payment solution to the Mobile
Operator community enhancing our on-device digital payments
capabilities and continue to see an increase in payments via mobile
wallet solutions.
-- Increasing focus and use by consumers of on device payment
solutions such as 'Mobile Optimised Web Pages' and 'Mobile
Applications'.
-- We have continued to deliver high payment success rates and
low fraud levels in line with internal targets during the period,
enabling us to improve commercial terms with our partners as our
volumes grow in the longer term and to realise the benefits of our
internal fraud solution.
-- IBM global Beacon award winner for "Outstanding Solution
Hosted on IBM Cloud" for our globally secure data centre
platform.
-- Successfully delivered annual PCI DSS level 1 accreditation for 2016/2017.
Financial Highlights
-- Value of transactions processed in the period increased by
34% to GBP39.1 million versus H1 2015.
-- Total revenue increased to GBP1.6 million (H1 2015: GBP1.5
million). Transaction revenue growth of 9% was lower than our
volume growth of 34%, as one customer, on contract renewal opted to
pay the merchant acquiring fee directly rather than through the
Mi-Pay contract which now covers our highest value services, having
no overall impact on our gross profit.
-- Transaction growth and enhanced processing efficiency
delivered a 33% improvement in Gross profit to GBP1.0 million (H1
2015 GBP0.7 million), underpinned by a 13 percentage point
improvement in gross margin to 62% (H1 2015: 49%).
-- GBP0.5m reduction in total administrative expenses to GBP1.2
million (H1 2015: GBP1.7 million).
-- Operating loss reduced by GBP0.7 million to GBP0.3 million
for the period (H1 2015: GBP1.0 million).
-- Cash & cash equivalents as at 30 June 2016 were GBP3.4 million (H1 2015: GBP3.8 million).
-- Net cash out flows, excluding movements in amounts due to
clients, cash flow from financing and investing activities and one
off exception expenditure reduced to GBP0.1 million for the period.
(H1 2015: Net cash outflow GBP0.7 million).
-- Basic and diluted loss per share 0.6 pence (H1 2015: 3 pence loss per share).
Seamus Keating, Chairman of Mi-Pay Group plc commented:
"The Board is pleased with the progress made during the first
half of 2016 and specifically the continued improvement in gross
profits and lower operating costs, making further progress towards
profitability.
We are seeing increasing opportunities with our clients as they
start to embrace the need for a robust digital payment strategy
and, in parallel, focus their attention on how they will deal with
the increasing global risks of payment fraud and data security. Our
proven capabilities in both of these areas means our solution is
becoming increasingly relevant in our market. This strengthening
business environment together with a strong closing cash position
allows us to continue to invest to evolve and future-proof our
product and service offerings."
For further information, please contact:
Mi-Pay Group plc IFC Advisory Zeus Capital
Tel: +44 207 112 Tel: +44 20 3053 Tel: +44 161 831
2129 8671 1512
Seamus Keating, Graham Herring Nick Cowles
Chairman
John Beale, CFO Tim Metcalfe Jamie Peel
Heather Armstrong
Founded in 2003, Mi-Pay Group enables clients to transform their
customers' payment journey and move them from paper to digital,
improving the overall customer experience and delivering more
choice and flexibility for pre-paid customers. Our product offering
provides the infrastructure to enable pre-paid mobile devices to be
topped up via a variety of channels such as websites, mobile
applications and social media applications. Customers include
Mobile Network Operators (MNOs) and Mobile Virtual Network
Operators (MVNOs). Our fully outsourced online payments solutions
are enhanced by a fully integrated suite of risk management tools
to provide the highest level of payment fraud management and data
security for our clients and their customers. Mi-Pay sells,
integrates and operates its products and solutions on a global
basis. For further information, please visit www.Mi-Pay.com or the
contact details as shown above.
Chief Executive Officer's review
H1 2016 Overview
Mi-Pay has continued to deliver improvements in its trading
performance seeing further strong growth in the value of
transactions processed, our core long term growth engine. This in
turn has driven increased gross profits. The transaction growth has
enabled us to deliver our services more efficiently on our platform
and increased our ability to negotiate improved terms with our
partners further enhancing gross margins, and reducing our cost
base.
We continue to see the natural migration of consumers to the
direct, on-line digital sales channel from that of the traditional
retail store 'paper' voucher model. We expect this to continue as
our clients increasingly recognise this channel as a strategic
requirement for marketing, growth and customer retention. Our
clients' digital transformation strategies, alongside financial
risk aversion and an ever increasing cybersecurity risk increases
the attractiveness of Mi-Pay as a partner to help drive this
transition with our flexible, simple and secure outsourced
solutions. We believe that our proven ability to provide a market
leading digital content delivery platform and an optimised on
device seamless payment experience in a risk free environment puts
us in a strong position to take advantage of this continuing
migration trend.
Strategy
'The changing world of payments enhances our position as a
consolidator of the market to de-risk our client's future access to
their customers'
As consumers continue to migrate from customer-present, paper
payment methods to making payments virtually, using digital
channels, the Mi-Pay proposition becomes increasingly relevant to
our target audiences - in terms of growth, customer retention, risk
mitigation and data security. Furthermore, against the back-drop of
the economic uncertainty caused by Brexit and the likelihood of
client's having a renewed focus on driving business cost
efficiencies, our outsourced model adds another compelling reason
for potential clients to work with Mi-Pay.
Our strategy is to deliver outsourced person not present,
primarily on-line payment solutions, in the main to Mobile
Operators enabling them to better serve their pre-paid subscriber
base. Our value proposition provides an excellent and complete
outsourced end-user experience and where required, indemnifies our
clients against fraudulent transactions and takes the
responsibility of securing their customers data. Mi-Pay's products
also increase revenue through better customer payment experience
maximising payment success rates. In addition, our products provide
an invaluable tool for customer relationship management - reducing
churn rates and enabling online payment solutions as a marketing
tool. Critically we are payment agnostic and will facilitate across
our client base, the relevant market leading payment methods,
applying our own experience and optimisation techniques to enhance
the existing customer experience. This approach both improves the
customer journey and future proofs our clients' payment, security
and risk management capabilities.
We aim to offer our clients a multi-faceted payment solution to
enhance their customer retention strategies. This will enable them
to deliver long term direct channel strategies transitioning their
customers from traditional unregistered 'card' payment, to 'one
click', recurring, secure, multi-channel payment. As a result, our
clients will also be able to market directly to their consumers via
our channels, helping them to drive long term value.
Through our connections to major operators in the UK, Europe and
Asia Pacific we continue to see strong migration onto the digital
channel. We are targeting growth in volumes from existing clients
as they continue to look for competitive solutions to retain and
better manage their consumer bases. Our ability to consolidate
multiple payment options, fraud and security solutions together
with multiple customer contact channels de-risks our client's
future access to their customers.
Asia Pacific is a market of significant potential for Mi-Pay
where the penetration of consumers with both smartphones and bank
accounts is growing to a level of critical mass. The global
investments of Visa, MasterCard and subsequent payment specialists
such as PayPal continue to drive the growth of consumers with bank
accounts, facilitating our future growth in Asia Pacific and
enabling us to engage with new and existing clients across the
region.
Our solution provides a high value and risk free option to the
Mobile Operators, whilst at the same time it provides our payment
partners with access to growing markets. In Asia specifically our
experience in optimising online payment solutions whilst managing
fraud provides a clear competitive advantage as the market
develops.
Operational Review
Trading
We delivered a 34% increase in total transaction value processed
to GBP39.1 million versus GBP29.2 million for the same period in
2015, continuing our prior year trends of an annual 30% + per annum
growth. This drove a 33% increase in gross profit to GBP1.0 million
and our gross margin increased again from 49% in H1 2015 to 62% in
H1 2016 as the increased transaction values enabled us to deliver
improved terms with our partners and better manage our fraud
risks.
Our total revenue increased to GBP1.6 million (GBP1.5 million H1
2015). Our revenue growth was impacted by a GBP0.2 million
reduction in revenue over the comparative periods due to changes in
the way we trade with a major client who insourced the lower value
payment processing element of our service that we traditionally
charge at cost. Our flexibility enabled us to re-sign a two-year
contract extension and continue to deliver our higher value
customer relationship channels, fraud and data security solutions
with the change having no negative impact on our profits. This
demonstrates our ability to flexibly adapt our commercial model to
our customers' requirements without impacting our performance
levels.
The growth in transactions continued to be delivered primarily
from our existing European clients through the implementation of
new services as we see the natural migration of their consumers to
the on-line, digital channel. Additionally, we are seeing
increasing client focus on security - both payment fraud management
and cyber security to enhance the protection of consumer data. We
see these trends continuing and Mi-Pay's solution has an increasing
relevance in managing these challenges.
Whilst we continue to see the natural migration of consumers
from the traditional 'in-store' paper voucher solutions onto the
direct, digital solutions, we are now increasingly seeing our
customers choosing website and 'on-device' payment channels such as
Mobile Apps and Device Optimised Web pages. This now accounts for
over 52% of our transactions processed (42% January 2015) versus
that of the traditional Interactive Voice Solutions, which has
reduced to less than 36% (41% January 2015). In addition, our
consumers are now showing an increased preference for mobile wallet
based payment solutions such as PayPal and Amazon Payments which
have grown from 7% of our total volume to over 12% since January
2015. These are key areas for investment for Mi-Pay and one where
we expect to see real growth helping to drive consumers onto the
digital channel where we operate our services. During the last 12
months we have successfully delivered 'In-APP' payments to our two
largest clients and have been the first payment provider to deliver
Amazon Payments, alongside PayPal to the Operator community and
expect to follow this up in H2 2016 with further new investments.
We will continue to invest in market leading on-device payment
solutions and on device delivery mechanisms.
Our service in the Philippines remains live with a major Mobile
Operator, but we continue to see delays in marketing the solution
and now expect the Mobile Operator to launch its marketing campaign
later in 2016. In the United Kingdom we have seen 3 Virtual Mobile
Network Operators close their service in the UK (Mobile By
Sainsbury, Post Office Mobile and Globe Telecom) however we expect
the majority of their customers to migrate to other client's
services that we offer over time and this should therefore have
limited impact over the long term.
Security and stability remains at our heart and the increasing
risks that have been seen in the 'cyber community' in the last 12
months increases our solutions value to our clients and their
customers. We are firstly pleased to see good infrastructure
stability following the data center migration project in late 2015,
which additionally led to a global IBM Cloud Solution award, and
secondly, the continued stability in our employee base following
the restructure in 2014 has led to improved solutions and
reductions in our operational costs. We additionally continue to
invest in our data security and were pleased to again achieve PCI
DSS (3.2) level 1 accreditation for 2016/ 2017 for the 6(th) year
running. We will deliver full data encryption, not simply payment
data across our whole infrastructure to ensure all of our client's
personal data is fully protected, but also to future proof and
protect our clients to the highest level.
Financial Review
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP
GBP
Transactional Services:
Gross Revenue 39,051,426 29,158,408 64,666,714
Transaction Services Revenue
excluding contractual change 1,158,998 904,951 1,994,111
Impacted Client Transaction
Services Revenue 48,818 206,408 263,019
Transaction Services Revenue 1,207,816 1,111,359 2,257,130
Professional Services Revenue 378,122 388,713 757,044
Revenue 1,585,938 1,500,072 3,014,174
Gross profit 982,513 736,229 1,691,342
Gross profit % 62% 49% 56%
------------------------------- ------------ ------------ ------------
Administrative Expenses (1,236,982) (1,739,601) (3,130,318)
Operating loss (254,469) (1,003,372) (1,438,976)
Cash and cash equivalents
at beginning of period 3,530,154 2,002,698 2,002,698
Adjusted Net cash flow from
operating activities(1) (131,679) (679,206) (681,258)
Exceptional items (50,902) - (4,360)
Cash inflow from management
of client payments 152,950 865,254 707,478
Capital Expenditure (27,113) (45,958) (74,899)
Cash flow from financing (33,000) 1,613,495 1,580,495
Cash and cash equivalents
at end of period 3,440,410 3,756,283 3,530,154
Basic and diluted loss per
ordinary share (0.6)p (3)p (3.6)p
------------------------------- ------------ ------------ ------------
(1)Adjusted Net cash flow from operating activities excludes
cash flows from the management of client payments and exceptional
items
With transaction values, revenues and gross profits all growing,
we are pleased to report a 33% increase in gross profits to GBP1.0
million, with a 13 percentage point improvement in gross margins.
Additionally, we continued to manage effectively our administrative
expenses, reducing these by a further GBP0.5 million against the
same period in 2015 to GBP1.2 million which led to a reduction in
our Operating losses of GBP0.7 million to GBP0.3 million. In
addition, this loss included GBP0.1 million relating to deferred
salaries not paid to Directors and GBP0.1 million of costs related
to one-off exceptional activities.
Our balance sheet remained consistent with prior periods with no
material movements to report and our working capital requirements
remain minimal due to our business model of collecting payments at
source. Cumulative amounts due to Directors for deferred salaries
unpaid closed the period at GBP0.2 million and we closed the period
expecting to recover GBP0.4 million in cash for research and
development tax credits due for the 18-month period to June 2016,
GBP0.3 million of which was paid in August 2016.
The Group ended the period with GBP3.4 million in cash and cash
equivalents (GBP3.8 million at 30 June 2015), noting that of this
balance, GBP2.3 million related to the operation of managing client
payments (GBP2.3 million as at 30 June 2015). Excluding a GBP0.1
million positive working capital movement due to client related
cash balances as our transaction volumes grew, capital expenditure,
finance lease payments and one off exceptional items, net cash
outflow from operating activities was GBP0.1 million (GBP0.7
million for the 6-month period to 30 June 2015). In August 2016 we
subsequently received a cash inflow of GBP0.3 million for research
and development tax credits relating to the 12-month period to 31
December 2015.
Employees
We recognise that the performance achieved in this period would
not have been possible without the support and continued dedication
of our staff who have supported the new delivery model and
continued to deliver solutions to our clients, support the strong
transaction growth and develop improved, secure technologies
despite the restructure during the period. They are our most
valuable resource and we would like to thank them for their
efforts.
Outlook
Mi-Pay has made significant progress towards delivering its
short term objective of becoming cash generative. Having invested
heavily in 2014 the benefits of this are now being demonstrated in
the Group's performance at every level with increased revenues,
gross profits and reduced administrative expenses. We expect to
continue to reduce cash burn on a month-by-month basis, see
continued revenue growth from all of our clients and continue to
improve our gross margins.
Continued investment into our fraud management capabilities and
delivery in 2015 of a flexible, highly secure and market compliant
global infrastructure environment, will provide us with a platform
to grow more effectively and with greater stability. Our focus for
the rest of 2016 and beyond is to achieve profitability, continue
to support and grow our existing client bases and deliver new
clients, specifically targeting the increasing need for more mobile
and social media based payment experiences in a safe, secure and
fully managed environment.
For the full year, we expect transaction value processed to be
in the region of GBP80 million (2015: GBP65 million). Together with
our current visibility of professional services projects, we expect
total revenue for 2016 in the range of GBP3.2-3.5 million with
gross margins expected to be in line with those experienced in H1.
The Board is confident that good progress is being made towards
profitability and cash flow break even.
The Board remains confident that our total market opportunity
continues to increase as the digital payments market expands
globally and our solutions become increasingly relevant to a wider
set of customers and geographies, and our growing relationship with
all of our clients keeps us in a strong position to take advantage
of this. The key market of Asia remains an opportunity and one that
we expect to deliver growth for us over the longer term.
Michael Dickerson Seamus Keating
CEO Chairman
Consolidated Statement of Comprehensive Income
For the period of six months ended 30 June 2016
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
Note GBP GBP GBP
------------------------------ ----- ------------ ------------- --------------
Transactional Services:
Gross Revenue 39,051,426 29,158,408 64,666,714
Transactional Services:
Net Commission Revenue 1,207,816 1,111,359 2,257,130
Professional Services
Revenue 378,122 388,713 757,044
------------------------------ ----- ------------ ------------- --------------
Revenue 1,585,938 1,500,072 3,014,174
------------------------------ ----- ------------ ------------- --------------
Cost of sales (603,425) (763,843) (1,322,832)
------------------------------ ----- ------------ ------------- --------------
Gross profit 2 982,513 736,229 1,691,342
Administrative expenses
------------------------------ ----- ------------ ------------- --------------
General and administration (1,014,919) (1,218,696) (2,287,618)
Research and development (104,089) (237,390) (384,909)
Depreciation (67,072) (81,042) (127,121)
Share-based payment - (202,473) (326,310)
Exceptional items 3 (50,902) - (4,360)
------------------------------ ----- ------------ ------------- --------------
Total administrative
expenses (1,236,982) (1,739,601) (3,130,318)
Operating loss (254,469) (1,003,372) (1,438,976)
Finance income 1,791 1,031 3,512
Finance expense (30) (471) (478)
------------------------------ ----- ------------ ------------- --------------
Loss before taxation (252,708) (1,002,812) (1,435,942)
Taxation 4 - (3,149) (3,149)
------------------------------ ----- ------------ ------------- --------------
Loss for the period/year (252,708) (1,005,961) (1,439,091)
------------------------------ ----- ------------ ------------- --------------
Other Comprehensive
expense for the year
Exchange differences
on translation of foreign
operations (645) (1,927) (695)
Loss and total comprehensive
expense for period
attributable to the
owners of the parent (253,353) (1,007,888) (1,439,786)
------------------------------ ----- ------------ ------------- --------------
Basic and diluted loss
per ordinary share 5 (0.6)p (3)p (3.6)p
------------------------------ ----- ------------ ------------- --------------
Consolidated Statement of Financial Position
As at 30 June 2016
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
Note GBP GBP GBP
------------------------------- ----- ------------- ------------- -------------
ASSETS
Non-current assets
Property, plant and
equipment 218,101 275,197 258,059
Total non-current assets 218,101 275,197 258,059
Current assets
Trade and other receivables 6 772,411 966,705 724,335
R&D tax credit receivable 374,375 451,512 203,657
Cash and cash equivalents 3,440,410 3,756,283 3,530,154
Total current assets 4,587,196 5,174,500 4,458,146
Total assets 4,805,297 5,449,697 4,716,205
------------------------------- ----- ------------- ------------- -------------
LIABILITIES
Current liabilities
Trade and other payables 7 (3,849,186) (3,866,172) (3,473,741)
Obligations under finance
lease (66,000) (66,000) (66,000)
------------------------------- ----- ------------- ------------- -------------
Total current liabilities (3,915,186) (3,932,172) (3,539,741)
Non-current liabilities
Obligations under finance
lease (66,000) (132,000) (99,000)
------------------------------- ----- ------------- ------------- -------------
Total non-current liabilities (66,000) (132,000) (99,000)
Total liabilities (3,981,186) (4,064,172) (3,638,741)
------------------------------- ----- ------------- ------------- -------------
Net assets 824,111 1,385,525 1,077,464
------------------------------- ----- ------------- ------------- -------------
Equity
Share capital 4,159,323 4,159,323 4,159,323
Share premium 1,403,923 1,403,923 1,403,923
Share options reserve 624,729 500,892 624,729
Reverse acquisition
reserve 6,920,115 6,920,115 6,920,115
Merger reserve 6,808,742 6,808,742 6,808,742
Retained deficit (19,092,721) (18,407,470) (18,839,368)
------------------------------- ----- ------------- ------------- -------------
Total equity attributable
to the equity shareholders
of the parent 824,111 1,385,525 1,077,464
Michael Clay Dickerson
Chief executive officer
Consolidated Statement of Cash Flows
For the period of six months ended 30 June 2016
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
Note GBP GBP GBP
--------------------------------- ------ ------------ ------------ ------------
Cash flows from operating
activities
Loss before tax from
continuing operations (252,708) (1,002,812) (1,435,942)
----------------------------------------- ------------ ------------ ------------
Adjusted for:
Depreciation 67,072 81,042 127,121
Finance income (1,791) (1,031) (3,512)
Finance expense 30 471 478
Share based payment - 202,473 326,310
R&D credits (170,808) (81,395) (203,657)
(Increase) / decrease
in trade and other receivables (48,632) (238,346) 34,808
Increase / (decrease)
in trade and other payables 375,445 1,228,235 833,887
Adjusted profit/(loss)
from operations after
changes in working capital (31,392) 188,637 (320,507)
Interest received 1,791 1,031 3,512
Interest paid (30) (471) (478)
Corporation tax (paid)/received
(inc R&D credits) - (3,149) 339,333
Net cash flows from
operating activities (29,631) 186,048 21,860
Cash flows from investing
activities
Purchase of property,
plant and equipment (27,113) (45,958) (74,899)
Net cash flows from
investing activities (27,113) (45,958) (74,899)
Cash flows from financing
activities
Proceeds from issue
of share capital, net
of issue costs - 1,646,495 1,646,945
Finance lease payments (33,000) (33,000) (66,000)
Net cash flows from
financing activities (33,000) 1,613,495 1,580,495
Net increase / (decrease)
in cash and cash equivalents (89,744) 1,753,585 1,527,456
Cash and cash equivalents
at beginning of period 3,530,154 2,002,698 2,002,698
----------------------------------------- ------------ ------------ ------------
Cash and cash equivalents
at end of period 3,440,410 3,756,283 3,530,154
----------------------------------------- ------------ ------------ ------------
Consolidated Statement of Changes in Equity
For the period of six months ended 30 June 2016
Share Reverse
For the period ended 30 Share Share options acquisition Merger Retained
June 2016 capital premium reserve reserve reserve deficit Total
GBP GBP GBP GBP GBP GBP GBP
----------------------------- ---------- ---------- --------- ------------- ---------- ------------- ----------
At 1 January 2016 4,159,323 1,403,923 624,729 6,920,115 6,808,742 (18,839,368) 1,077,464
Loss for the period from
continuing operations - - - - - (252,708) (252,708)
----------------------------- ---------- ---------- --------- ------------- ---------- ------------- ----------
Other comprehensive expense
for the period - - - - - (645) (645)
At 30 June 2016 4,159,323 1,403,923 624,729 6,920,115 6,808,742 (19,092,721) 824,111
============================= ========== ========== ========= ============= ========== ============= ==========
Consolidated Statement of Changes in Equity
For the period of six months ended 30 June 2015
Share Reverse
For the period ended 30 Share Share options acquisition Merger Retained
June 2015 capital premium reserve reserve reserve deficit Total
GBP GBP GBP GBP GBP GBP GBP
--------------------------- ---------- ---------- --------- ------------- ---------- ------------- ------------
At 1 January 2015 3,398,453 518,298 298,419 6,920,115 6,808,742 (17,399,582) 544,445
Loss for the period from
continuing operations - - - - - (1,005,961) (1,005,961)
--------------------------- ---------- ---------- --------- ------------- ---------- ------------- ------------
Other comprehensive
expense
for the period - - - - - (1,927) (1,927)
Placing of new ordinary
shares in the period 760,870 885,625 - - - - 1,646,495
Share-based payment - - 202,473 - - - 202,473
At 30 June 2015 4,159,323 1,403,923 500,892 6,920,115 6,808,742 (18,407,470) 1,385,525
=========================== ========== ========== ========= ============= ========== ============= ============
Consolidated Statement of Changes in Equity
For the year ended 31 December 2015
Share Reverse
For the year ended 31 Share Share options acquisition Merger Retained
December 2015 capital premium reserve reserve reserve deficit Total
GBP GBP GBP GBP GBP GBP GBP
--------------------------- ---------- ---------- --------- ------------- ---------- ------------- ------------
At 1 January 2015 3,398,453 518,298 298,419 6,920,115 6,808,742 (17,399,582) 544,445
Loss for the year from
continuing operations - - - - - (1,439,091) (1,439,091)
--------------------------- ---------- ---------- --------- ------------- ---------- ------------- ------------
Other comprehensive
expense
for the period - - - - - (695) (695)
Additional placing shares 760,870 885,625 - - - - 1,646,495
Share-based payment - - 326,310 - - - 326,310
At 31 December 2015 4,159,323 1,403,923 624,729 6,920,115 6,808,742 (18,839,368) 1,077,464
=========================== ========== ========== ========= ============= ========== ============= ============
Notes to the Financial Information
1 Basis of preparation
The unaudited consolidated half-yearly financial information in
this report has been prepared on the basis of the accounting
policies expected to apply for the financial year to 31 December
2016 and in accordance with recognition and measurement principles
of International Financial Reporting Standards (IFRS) as endorsed
by the European Union. The accounting policies applied in the
preparation of this half-yearly financial information are
consistent with those used in the financial statements for the year
ended 31 December 2015. This interim report has not been reviewed
by the Group's auditors, and does not constitute statutory accounts
within the meaning of the Companies Act 2006. The financial
information for the six months ended 30 June 2016 and 30 June 2015
is not audited.
The financial information contained in this document does not
include all of the information required for full annual financial
statements and do not comply with all of the disclosures in IAS34
'Interim Financial Reporting'. Accordingly, whilst this financial
information has been prepared in accordance with IFRS they cannot
be construed as being in full compliance with IFRS.
The financial information for the year ended 31 December 2015
does not constitute the full statutory accounts for that period.
The Annual Report and Accounts for 31 December 2015 have been filed
with the Registrar of Companies. The Independent Auditors' Report
on the Annual Report and Accounts for 2015 was unqualified and did
not include references to any matters which the auditors drew
attention to by way of emphasis without qualifying their report and
did not contain statements under Section 498(2) or 498(3) of the
Companies Act 2006.
2 Segmental analysis
The chief operating decision maker has been identified as the
Chief Executive Officer (CEO) of the group. The chief operating
decision maker is responsible for regularly assessing the
performance of the group's operating segments and performing the
function of allocating resources. To assist the chief operating
decision maker in this process, internally generated reporting is
prepared for each operating segment.
The group has two operating segments that it reports on. These
operating segments are:
-- Transaction Services Revenues: This segment generates revenue
from the processing of transactions on behalf of clients and is
Mi-Pay Group plc's core business.
-- Professional Services Revenues: This segment generates
revenue from the development, delivery and hosting of our platform
and client solutions.
The CEO assesses the performance of the operating segments based
on revenue and gross profit. The CEO uses these measures to assess
performance because they are quick to analyse and directly relevant
to evaluating the results of each segment. (1)
2 Segmental analysis (continued)
Both segments are continuing operations and results are as
follows:
Operating Segments
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP GBP
Transaction Services
Revenue 1,207,816 1,111,359 2,257,130
Professional Services
Revenue 378,122 388,713 757,044
------------ ------------ ----------
Total revenue 1,585,938 1,500,072 3,014,174
Transaction services
cost of sales 542,866 670,071 1,167,525
Professional services
cost of sales 60,559 93,772 155,307
------------ ------------ ----------
Total cost of sales 603,425 763,843 1,322,832
Transaction services
gross profit 664,950 441,288 1,089,605
Professional services
gross profit 317,563 294,941 601,737
------------ ------------ ----------
Total gross profit 982,513 736,229 1,691,342
============ ============ ==========
Transaction services
gross profit 55% 40% 48%
Professional services
gross profit 84% 76% 79%
------------ ------------ ----------
Total gross profit 62% 49% 56%
============ ============ ==========
(1) There is no inter segment trading and assets and liabilities
are not allocated to segments.
3 Exceptional items
The exceptional item recognised in the six month period to 30
June 2016 reflects costs that, in the opinion of the board of
directors, are non-recurring as they relate to professional fees
incurred on an aborted acquisition.
4 Taxation
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP GBP
------------------------ ------------- ------------ --------
Foreign Tax
Current tax on foreign
income for the year - 3,149 3,149
------------------------ -------------- ------------ --------
Total tax charge - 3,149 3,149
======================== ============== ============ ========
5 Loss per share
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP GBP
----------------------- ------------ ------------ ------------
Loss for the year (252,708) (1,005,961) (1,439,091)
Weight-average shares
outstanding (number) 41,593,229 38,776,750 40,175,719
----------------------- ------------ ------------ ------------
Basic EPS (0.6)p (3)p (3.6)p
Diluted EPS (0.6)p (3)p (3.6)p
======================= ============ ============ ============
The numerators shown above represent the total loss from
continuing operations for the period or year.
Since the Group was in a loss making position for all three
periods presented, there was no difference between the weighted
average number of shares used to calculate basic and diluted net
loss per share.
6 Trade and other receivables
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP GBP
Trade receivables 132,226 114,416 167,690
Less: provision for impairment - - -
of trade receivables
------------ ------------ --------
Trade receivables - net 132,226 114,416 167,690
Client receivables 490,243 749,960 471,428
Prepayments 117,877 63,861 65,785
Other receivables 32,065 38,468 19,432
------------ ------------ --------
Total trade and other
receivables 772,411 966,705 724,335
============ ============ ========
7 Trade and other payables
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2016 2015 2015
GBP GBP GBP
Trade payables 256,214 173,066 109,480
Client payables 2,822,383 3,068,999 2,626,055
Accruals 393,661 387,549 364,775
Deferred income 62,038 91,509 134,766
Other payables - tax
and social security payments 44,565 74,473 95,365
Deferred directors' emoluments 213,504 62,796 138,150
Other Payables 56,821 7,780 5,150
------------ ------------ ----------
Total trade and other
payables 3,849,186 3,866,172 3,473,741
============ ============ ==========
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR URSNRNUAKUAR
(END) Dow Jones Newswires
September 21, 2016 02:00 ET (06:00 GMT)
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