25 March 2024
Mobile Streams plc
("MOS" or "the Company")
Interim Results
Mobile Streams plc, the AIM quoted mobile content and data intelligence company, is pleased to announce its unaudited interim results for the six months ended 31 December 2023.
Highlights
Our focus during the half year to 31 December 2023 was primarily on the commercialisation of the NFT technology platform (NTP) and preparation to create the media, publishing and on-line casino and sports book business in Mexico. Significant progress was made with Capital Media Sports SA and related key partners in Mexico in shaping the commercial terms of the various agreements whilst in parallel, certain refinements, tailoring and ongoing development of our NTP took place in order to optimise it for working in this new setting. The Company has also significantly reduced costs and focused on improving operating efficiency.
Operations in our legacy mobile data businesses are now producing a modest gross profit and this helps to absorb a portion of the group's overhead expenses.
We remain optimistic that the NTP revenues can grow in line with the commercial agreements signed and announced The NFT products will be a key part of the online casino and sports book business with the delivery of a loyalty programme for Bet and we estimate that significant revenue could be generated by providing this service. Whilst we continue to bridge across from our legacy business activities associated with on-line gaming into new business activities arising from commercialisation of the NTP we have worked hard to review and reduce our operating expenditures.
Revenue for the period reduced in line with expectations following the completion of our partnership with International Gaming systems (IGS), as detailed in the 2023 Annual Report. We have focused on our goal of transitioning to a media, publishing and online betting and sports book businesses, whilst also driving efficiencies across the Company in order to reach operationally profitability on a monthly basis during this calendar year. The success of this strategy resulted in the pre-tax loss for the 6 months being £289k, substantially lower than the loss of £1,231k in the 6 months to December 2022 (improvement by 76.52%) and £2,558k in the 6 months to June 2023 (improvement by 88.70%)
The NTP has been recorded as an intangible asset in the financial statements under IFRS with a net book value at 31 December 2023 of £421k. We believe, however, that its trade sale value would be significantly higher based on market comparables.
Outlook
The Company is now well positioned as a business, with a strong suite of proprietary technology platforms and investments The Directors believe that the actions taken over the six months to December 2023 will enable the business to fully capitalise on the opportunities in Mexican Sports publishing, ,media and online casino and sports book services. We are now also looking to create synergies driving revenue opportunities to the betting business from our existing platform portfolio, including both the NTP and LiveScores sites. Accordingly, we remain on track to reach operational profitability on a monthly basis during this year.
Mark Epstein, CEO, said:
"We are very pleased with the progress that the organisation has made in the past 6 months in the start-up of the Mexican sports betting business and transformation of our business. This has only been possible due to the quality and capability of our Streams Technology platform combined with the dedication and skills of our team. Our Company is now well positioned to emerge from this period of transition and develop into a growing and profitable business."
CONSOLIDATED INCOME STATEMENT
| Unaudited | Unaudited | Audited | |
| 6 months ended 31 December | 6 months ended 31 December | 12 months ended 30 June | |
| 2023 | 2022 | 2023 | |
| £000's | £000's | £000's | |
Revenue | 169 | 1,069 | 1,824 | |
Cost of sales | (21) | (629) | (1,812) | |
Gross profit | 148 | 440 | 12 | |
Selling and marketing costs | (34) | (98) | (876) | |
Administrative expenses ** | (414) | (1,574) | (2,928) | |
Operating Loss | (300) | (1,232) | (3,792) | |
| | |
| |
Finance income | 11 | 1 | 3 | |
Finance expense | - | - | - | |
Loss before tax | (289) | (1,231) | (3,789) | |
| | |
| |
Tax expense | - | - | - | |
Loss for the period | (289) | (1,231) | (3,789) | |
| | |
| |
Attributable to: | | |
| |
Attributable to equity shareholders of Mobile Streams Plc | (289) | (1,231) | (3,789) | |
| (289) | (1,231) | (3,789) | |
|
|
|
| |
| Pence per share | Pence per share | Pence per share | |
Basic loss per share | (0.006) | (0.032) | (0.093) | |
Diluted loss per share | (0.006) | (0.032) | (0.093) | |
| | | | |
* *Administrative expenses include depreciation, amortisation, impairment and share based compensation. | ||||
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Unaudited | Unaudited | Audited | |
| 31-Dec-23 | 31-Dec-22 | 30-Jun-23 | |
| £000's | £000's | £000's | |
Assets | | | | |
Non- Current | | | | |
Goodwill | - | 360 | - | |
Intangible assets | 422 | 396 | - | |
Other investments | - | - | - | |
| 422 | 756 | - | |
Current | | | | |
Trade and other receivables | 395 | 649 | 148 | |
Unsettled share subscription monies** | 407 | - | - | |
Cash and cash equivalents | 337 | 1,597 | 913 | |
| 1,139 | 2,246 | 1,061 |
|
| | | | |
Total assets | 1,561 | 3,002 | 1,061 |
|
| | | | |
Equity | | | | |
Equity attributable to equity holders of Mobile Streams plc | | | | |
Called up share capital | 864 | 757 | 768 | |
Share Premium | 21,909 | 20,752 | 21,331 | |
Translation reserve | (3,050) | (3,050) | (3,050) | |
Share Based Payment Reserve | 62 | 13 | 25 | |
Retained earnings | (18,832) | (15,983) | (18,541) | |
Total equity | 955 | 2,489 | 533 | |
| | | | |
Trade and other payables | 565 | 469 | 487 | |
Bank debt | 40 | 44 | 41 | |
| 605 | 513 | 528 | |
| | | | |
Total liabilities | 605 | 513 | 528 | |
| | | | |
Total equity and liabilities | 1,561 | 3,002 | 1,061 |
|
** The unsettled share subscription monies at 31 December 2023 in the amount of £407,000 were received in full in the first four days of January 2024.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| Equity attributable to equity holders of Mobile Streams plc
| |||||||||
| | Called up share capital | Share premium | Translation reserve | Share-based payment reserve | Retained earnings | Non- Controlling Interest | Total Equity |
| |
| | £000's | £000's | £000's | £000's | £000's | £000's | £000's |
| |
| Balance at 1 July 2021 | 567 | 16,765 | (3,050) | 13 | (11,480) | 1 | 2,816 |
| |
| Loss for the 6 months | - | - | - | - | (639) | - | (639) |
| |
| Warrants charge | - | - | - | - | - | - | - |
| |
| Issue of shares | 18 | 510 | - | - | - | - | 528 |
| |
| Balance at 31 December 2021 | 585 | 17,275 | (3,050) | 13 | (12,119) | - | 2,705 |
| |
| Loss for the 6 months | - | - | - | - | (2,125) | - | (2,125) |
| |
| Warrants charge | - | - | - | 255 | - | - | 255 |
| |
| Issue of shares | 74 | 2,059 | - | - | - | - | 2,133 |
| |
| Acquisition of 51% of KrunchData Limited | - | - | - | - | (763) | (1) | (764) |
| |
| Balance at 30 June 2022 | 659 | 19,334 | (3,050) | 268 | (15,007) | - | 2,204 |
| |
| Prior Year Adjustment | - | - | - | (255) | 255 | - | - |
| |
| Balance at 1 July 2022 | 659 | 19,334 | (3,050) | 13 | (14,752) | - | 2,204 |
| |
| Loss for the 6 months | - | - | - | - | (1,231) | - | (1,231) |
| |
| Share Options charge | - | - | - | - | - | - | - |
| |
| Issue of shares | 98 | 1,418 | - | - | - | - | 1,516 |
| |
| Balance at 31 December 2022 | 757 | 20,752 | (3,050) | 13 | (15,983) | - | 2,489 |
| |
| Loss for the 6 months | - | - | - | - | (2,558) | - | (2,558) |
| |
| Share Options charge | - | - | - | 12 | - | - | 12 |
| |
| Issue of shares | 11 | 579 | - | - | - | - | 590 |
| |
| Balance at 30th June 2023 | 768 | 21,331 | (3,050) | 25 | (18,541) | - | 533 |
| |
| Loss for the 6 months | - | - | - | - | (289) | - | (289) |
| |
| Share Options charge | - | - | - | 37 | - | - | 37 |
| |
| Issue of shares | 96 | 579 | - | - | - | - | 675 |
| |
| Balance at 31st December 2023 | 864 | 21,909 | (3,050) | 62 | (18,832) | - | 955 |
| |
CONSOLIDATED CASH FLOW STATEMENT
| Unaudited | Unaudited | Audited |
| 6 months ended 31 December 2023 | 6 months ended 31 December 2022 | 12 months ended 30 June 2023 |
| £000's | £000's | £000's |
Operating activities |
|
|
|
Profit before taxation | (289) | (1,231) | (3,789) |
Adjustments: | | | |
Amortisation of intangible assets | - | 111 | 296 |
Impairment of Intangible assets | (305) | - | 708 |
Impairment of receivables | - | - | (15) |
Share based payments expense | 37 | - | 12 |
Profit on disposal of investment | - | (22) | (22) |
Remuneration paid to Senior managers in shares | 100 | 67 | 67 |
Consultant fees paid in shares | - | 129 | 719 |
Interest received | (11) | (1) | (3) |
Changes in Trade and other receivables | (246) | (489) | 28 |
Changes in Trade and other payables | 78 | 27 | 45 |
Total cash utilised in operating activities | (636) | (1,409) | (1,954) |
|
|
|
|
Investing Activities |
|
|
|
Additions to intangible assets | (116) | (177) | (318) |
Proceeds from sale of Gfinity shares | - | 192 | 192 |
Interest received | 11 | 1 | 3 |
Interest paid | - | - | - |
Net Cash used in investing activities | (105) | 16 | (123) |
|
|
|
|
Issue of share capital (net of expenses paid) | 168 | 1,320 | 1,320 |
Bank loan | (1) | (3) | (6) |
Net Cash generated from financing activities | 167 | 1,317 | 1,314 |
|
|
|
|
Net change in cash and cash equivalents | (575) | (76) | (763) |
Cash and cash equivalents at beginning of period | 913 | 1,675 | 1,675 |
Exchange (loss)/ gain on cash and cash equivalents | (1) | (2) | 1 |
Cash and cash equivalents at end of period | 337 | 1,597 | 913 |
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The interim results of Mobile Streams plc are prepared in accordance with the requirements of IAS 34 Interim Financial Reporting as adopted by the EU and prepared in accordance with the accounting policies set out in the last financial statements for the 12 months ended 30 June 2023.
The interim results, which are not audited, do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006.
The comparative financial information for the twelve months ended 30 June 2023 has been extracted from the statutory accounts for that period. In addition, the financial information for the 6 months ended 31 December 2022 has been extracted from the unaudited Interim results which were published on 27 March 2023.
The full audited accounts of the Group for the 12 months ended 30 June 2023 were prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the UK and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS and have been delivered to the Registrar of Companies. All references to IFRS in these statements refer to IFRS as adopted by the UK.
The auditor's report on the financial statements for the 12 months ended 30 June 2023 was unqualified and did not contain statements under S498 (2) or S498 (3) of the Companies Act 2006.
2. SEGMENTAL REPORTING
As at 31 December 2023, the Group was organised into four geographical segments: Europe, North America, Latin America, and Asia Pacific. Revenues were from external customers only and generated from three principal business activities: the sale of mobile content through MNOs (Mobile Operator sales), the sale of mobile content over the internet (Mobile Internet sales) and the provision of consulting and technical services (Other Service Fees) which includes the opening revenues pertaining to the new on-line sports betting and on-line casino business segment.
All operations are continuing and all inter-segment transfers, if any, are priced and carried out at arm's length. The segmental results for the 6 months ended 31 December 2023 were as follows:
£000's | Europe | Asia Pacific | North America | Latin America | Group | |||||
Mobile operator sales | - | - | - | 36 | 36 | |||||
Mobile internet sales | - | - | - | - | - | |||||
Other service fees | 133 | - | - | - | 133 | |||||
Total Revenue | 133 | - | - | 36 | 169 | |||||
Cost of sales | - | - | - | (21) | (21) | |||||
Gross profit | 133 | - | - | 15 | 148 | |||||
Operating expenses | (570) | (4) | - | (142) | (717) | |||||
EBITDA* | (438) | (4) | - | (127) | (568) | |||||
Depreciation, amortisation | 305 | - | - | - | 305 | |||||
Share based compensation | (37) | - | - | - | (37) | |||||
Finance income | - | - | - | 11 | 11 | |||||
Profit/(Loss) before tax | (170) | (4) | - | (116) | (289) | |||||
Income tax expense | - | - | - | - | - | |||||
Profit/(Loss) after tax | (170) | (4) | - | (116) | (289) | |||||
*Calculated as profit before tax, interest, amortization, depreciation, share compensation expense and impairment of assets.
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The segmental results for the 6 months ended 31 December 2022 were as follows:
£000's |
Europe | Asia Pacific | North America | Latin America |
Group |
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Mobile operator sales | - | 2 | - | 139 | 141 |
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Streams Data (IGS and NFT) | 823 | - | - | 105 | 928 |
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Other service fees (NFT) | | - | - | - | - |
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Total Revenue | 823 | 2 | - | 244 | 1,069 |
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Cost of sales | (573) | - | - | (56) | (629) |
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Gross profit | 250 | 2 | - | 188 | 440 |
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Operating expenses | (1,377) | (8) | - | (176) | (1,561) |
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EBITDA* | (1,127) | (6) | - | 12 | (1,121) |
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Depreciation, amortisation | (111) | - | - | - | (111) |
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Share based compensation | - | - | - | - | - |
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Finance income | - | - | - | 1 | 1 |
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Profit/(Loss) before tax | (1,238) | (6) | - | 13 | (1,231) |
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Income tax expense | - | - | - | - | - |
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Profit/(Loss) after tax | (1,238) | (6) | - | 13 | (1,231) |
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*Calculated as profit before tax, interest, amortization, depreciation, share compensation expense and impairment of assets.
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3. EARNINGS PER SHARE | | | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings per share | | | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per share is calculated by dividing the(loss)/profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period.
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Adjusted earnings per share | | | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted earnings per share is calculated to reflect the underlying profitability of the business by excluding non-cash charges for depreciation, amortisation, impairments and share compensation charges.
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Diluted (loss)/earnings per share is calculated adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has only one category of ordinary shares.
The adjusted EPS has been calculated to reflect the underlying profitability of the business by excluding non-cash charges for depreciation, amortisation, impairments and share compensation charges.
4. GOING CONCERN
The Group had cash balances of £0.3m at 31 December 2023 (30 June 2022: £1m). Having reviewed cash flow forecasts and budgets for the year ahead the Directors have a reasonable expectation that the Group has resources to continue in operational existence for the foreseeable future.
5. FOREIGN CURRENCY TRANSLATION
(a) Presentational currency
The consolidated financial statements are presented in British Pounds, which is also the functional currency of the parent entity.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date the transaction occurs. Any exchange gains or losses resulting from these transactions and from the translation of monetary assets and liabilities at the balance sheet date are reported in the income statement except when these represent a net investment in a subsidiary when they are charged or credited to equity.
Foreign currency balances are translated at the balance sheet date using exchange rates prevailing at the period end.
(c) Group companies
The financial results and position of all group entities that have a functional currency different from the presentational currency of the Group are translated into the presentational currency as follows:
i. assets and liabilities for each balance sheet are translated at the closing exchange rate at the date of the balance sheet
ii. income and expenses for each income statement are translated at average exchange rates (unless it is not a reasonable approximation to the exchange rate at the date of transaction)
iii. all resulting exchange differences are recognised as a separate component of equity (translation reserve)
iv. The exchange rates used in respect of Argentinean Pesos are the official published exchange rates.
6. Intangible assets
| Intangibles acquired: Platform Development & Software | Intangibles added internally Streams | Subtotal | Goodwill | Total |
| £'000 | £'000 | £'000 | £'000 | £'000 |
Cost or valuation: | | | | | |
At 1 July 2022 | 485 | 308 | 793 | 360 | 1,153 |
Additions | - | 177 | 177 | - | 177 |
Disposals | - | - | - | - | - |
At 31 December 2022 | 485 | 485 | 970 | 360 | 1,330 |
Additions | - | 141 | 141 | - | 141 |
Disposals | - | - | - | - | - |
At 30 June 2023 | 485 | 626 | 1,111 | 360 | 1,471 |
Additions | - | 116 | 116 | - | 116 |
Disposals | - | - | - | - | - |
At 31 December 2023 | 485 | 742 | 1,227 | 360 | 1,587 |
| | | | | |
Amortisation: | | | | | |
At 1 July 2022 | 274 | 193 | 467 | - | 467 |
Charge for the period | 50 | 61 | 111 | - | 111 |
Disposals | - | - | - | - | - |
At 31 December 2022 | 324 | 254 | 578 | - | 578 |
Charge for the period | 117 | 68 | 185 | | 185 |
Disposals | - | - | - | | - |
Impairment | 44 | 304 | 348 | 360 | 708 |
At 30 June 2023 | 485 | 626 | 1,111 | 360 | 1,471 |
Charge for the period | - | - | - | - | - |
Disposals | - | - | - | - | - |
Reversal of Impairment | (36) | (269) | (305) | - | (305) |
31 December 2023 | 449 | 369 | 818 | 360 | 1,178 |
| | | | | |
Carrying amount: | | | | | |
At 31 December 2022 | 161 | 235 | 396 | 360 | 756 |
At 30 June 2023 | - | - | - | - | - |
At 31 December 2023 | 36 | 390 | 422 | - | 422 |
The Directors of Mobile Streams plc reviewed the recoverable amount pertaining to the company's Streams Data platform in the light of an increase in the estimated service potential of the asset arising in recent months since the previous assessment and recognition of impairment at 30th June 2023. The recoverable amount was determined from value in use calculations using key assumptions derived from the most recent financial forecast and with a discount rate of 15% which is a based on comparative businesses weighted average cost of capital.
As a result of this exercise, the Directors concluded at 31st December 2023 that the asset was no longer impaired and a reversal of the previously recognised impairment loss of £348,000 has been recognised in the Statement of Comprehensive Income, adjusted by the quantity of amortisation (£43,000) that would otherwise have arisen during the 6 months to 31st December 2023 had the asset not been impaired at all.
During the 6 months to 31st December 2023 the group recognised further capitalised development costs on this asset in the amount of £116,000.
7. Other Investments
The group has no other investments at 31 December 31 2023 (30 June 2022: Nil).
8. Share Capital and Reserves
| 31 Dec 2023
| 31 Dec 2022 | 30 June 2023 |
| £000s | £000's | £000's |
Ordinary Share capital | 864 | 757 | 768 |
Share premium | 21,909 | 20,752 | 21,331 |
Translation Reserve | (3,050) | (3,050) | (3,050) |
Share Based Payment reserve | 62 | 13 | 25 |
Retained earnings | (18,832) | (15,983) | (18,541) |
| 955 | 513 | 533 |
The total number of Ordinary Shares in issue as at 31 Dec 2023 was 5,333,941,619 with a par value of 0.01 pence per share (31 Dec 2023: 4,267,146,922 with a par value of 0.01 pence per share). In addition, there are 140,753,533 Deferred Shares of 0.19 pence nominal value each in issue. The Deferred Shares, as their name suggests, have very limited rights which are deferred to the Ordinary Shares and effectively carry no value as a result.
Allotted, called up and fully paid | 6 months ended 31 Dec 2023 | 6 months ended 31 Dec 2022 | Year ended 30 June 2023 |
In issue at start of period | 4,369,655,903 | 3,285,590,326 | 3,285,590,326 |
Issued during the period | 964,285,716 | 981,556,596 | 1,084,065,577 |
In issue at end of period | 5,333,941,619 | 4,267,146,922 | 4,369,655,903 |
The balance in the share premium account represents the proceeds received above the nominal value on the issue of the Company's equity share capital.
On 12 December 2023 the Group issued 964,285,716 shares at 0.07 pence per share via a direct subscription, raising £675,000 of which £168,000 was received prior to 31 December 2023, £100,000 was in lieu of senior management services supplied in the 6 months to 31 December 2023 and £407,000 was received in early January 2024.
9. Post Balance Sheet Event
On 12 January 2024 the Group issued 191,259,992 shares at 0.06 pence per share via a retail offer, raising £114,756 with all subscription monies duly received.
On 18 March 2024 the Group issued 777,737,695 shares at 0.0425 pence per share via a Placing and Subscription, raising £330,359 with all subscription monies duly received.
On 22 March 2024 the Group issued 58,823,529 shares at 0.0425 pence per share via a Broker Offer, raising £25,000 with all subscription monies duly received.
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
For further information, please contact:
Mobile Streams plc
Nigel Burton, Adviser
+44 77 8523 4447
www.mobilestreams.com
Beaumont Cornish (Nominated Adviser)
James Biddle and Roland Cornish
+44 (0) 20 7628 3396
Panmure to be added
Simon French
Peterhouse Capital Limited (Joint Broker)
Lucy Williams and Duncan Vasey
+44 (0) 20 7469 0930
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