TIDMMIRA
RNS Number : 2935C
Mirada PLC
28 September 2018
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the
publication of this announcement via a Regulatory Information
Service, this inside information is now considered to be in the
public domain.
28 September 2018
Mirada plc
("Mirada", the "Company" or the "Group")
Final Results for the Year Ended 31 March 2018
Mirada plc (AIM: MIRA), the leading audio-visual content
interaction specialist, announces its final results for the year
ended 31 March 2018.
Financial Highlights
-- Revenue increased to $8.82 million (2017: $8.49 million). The
decrease in revenues with izzi Telecom (Televisa group) after the
Peso devaluation in Dec 2016 and izzi Telecom freeze of purchases
in USD was offset by the revaluation of USD vs EUR, which has
contributed to $0.63 million additional revenues.
-- Gross profit increased to $7.94 million (2017: $7.88 million)
-- Operating loss reduced to $4.62 million (2017: loss of $6.57 million)
-- Net loss reduced to $4.87 million (2017: loss of $7.10 million)
Operational Highlights
-- Contract win with ATN International Inc. (ATNi) for deployments in the Caribbean.
-- Contract win with Digital TV Cable Edmund S.R.L. in Bolivia.
-- New business model, with lower set-up fees leading to
recurrent long-term revenues from subscriber-based licence fees on
Software as a Service (SaaS) agreements.
-- Temporary reduction of izzi Telecom (Televisa Group)
investment on professional services during the year resulting from
uncertainties in the Mexican economy due to the November 2016 US
elections.
-- Deployment from March 2018 of Iris multiscreen licenses over
new segments of subscribers at izzi Telecom resulted in higher
monthly installations and an increase of more than $1.5m in
licence-fees collections post year end, since April 2018.
-- Secured GBP4.7 million in Facilities from Kaptungs, Minles
and Kronck (GBP1.7 million in November 2017 and GBP3.0 million in
March 2018). In the General Meeting held on August 29th, 2018 it
was approved to convert the GBP1.7 million facility into shares. In
the General Meeting to be held on October 4th, 2018 it is proposed
to increase capital by GBP6.0 million, with GBP3.0 million in cash
and with GBP3.0 million by discharging Mirada Plc from its
liability to pay to Kaptungs GBP3.0 million in accordance with the
terms of the second Facility Letter mentioned above, in
consideration for the Borrower treating such discharged amount as
payment in full for the subscription of 300,000,000 ordinary shares
of 1p each in the capital of the Borrower at a subscription price
of 1p per new ordinary share, each credited as fully paid up of an
additional GBP3.0 million.
Jose Luis Vazquez, CEO of Mirada, commented:
"Mirada participated in a significant number of advanced stage
tenders during the year and is seen as an increasingly relevant
supplier as new bids appear in the market. I am glad to say that we
currently have a strong pipeline in terms of the number of
opportunities we are participating in. This pipeline and an
increasing number of successful references is helping us secure new
opportunities and we are confident of announcing new relevant
contract wins in the near future."
Annual Report and Accounts
The Company's Annual Report and Accounts will be available on
the Company's website, www.mirada.tv, and posted to shareholders
today.
Enquiries
Mirada plc +44 (0) 207 868 2104
José Luis Vázquez, investors@mirada.tv
Chief Executive Officer
Gonzalo Babío, Chief Financial
Officer
Newgate Communications +44 (0) 207 680 6550
Bob Huxford mirada@newgatecomms.com
Tom Carnegie +44 (0) 20 3328 5656
Allenby Capital Limited
(AIM Nominated Adviser and Broker)
Jeremy Porter
Alex Brearley
Liz Kirchner
About Mirada
Mirada is a leading provider of products and services for
Digital TV Operators and Broadcasters. Founded in 2000 and led by
CEO José Luis Vázquez, the Company prides itself on having spent
almost 20 years as a pioneer in the Digital TV market. Mirada's
core focus is on the ever-growing demand for TV Everywhere for
which it offers a complete suite of end-to-end modular products
across multiple devices, all with innovative state-of-the-art UI
designs.
Mirada's products and solutions, acclaimed for unparalleled
flexibility and optimal time to market, have been deployed by some
of the biggest names in digital media and broadcasting including
Televisa, Telefonica, Sky, Virgin Media, BBC, ITV and France
Telecom. Headquartered in London, Mirada has commercial
representation across Europe, Latin America and Southeast Asia and
operates technology centres in the UK, Spain and Mexico. For more
information, visit www.mirada.tv
Chief Executive Officer's Statement
Overview
I am pleased to present the Group's financial results for the
year ended 31 March 2018. During this period the Group focused on
achieving and delivering new contract wins, notably with ATNi in
the United States and Digital TV Cable Edmund S.R.L. ("Digital TV
Cable") in Bolivia, whilst improving the market reach and ensuring
a top-level service to present customers. Mirada was able to
implement the transition to the new Software as a Service (SaaS)
business model, securing long-term recurrent revenues from the new
deals. As a result of our sales and marketing efforts, we increased
our number of referrals, leveraging the excellent job our technical
team performed at izzi Telecom. Also, and despite harsh conditions
in the Mexican market due to the peso volatility after the US
Elections, we were able to reinforce our relationship with our
largest customer (izzi Telecom). This, resulted in the extension of
the deployment of our technology over new customer segments and
while improving the on-going monthly licence-fee revenues for
Mirada.
Trading Review
The two major milestones for the fiscal year under review were
the contract wins of ATNi and Digital TV Cable. Both customers
joined our new SaaS business model, which allows them to benefit
from our support and maintenance and product updates on a timely
manner, paying a monthly fee per subscriber with minimum guaranteed
revenues. Although the set-up fees in this model are smaller than
in the previous one, the contract value is not eroded and
guarantees recurrent long-term licence fees, giving us much better
visibility on medium and long-term revenues. SaaS agreements
account for a continued growth of the customer subscribers base,
typically over three to five years, with minimum guaranteed
revenues aligned with this growth. Customers perceive that the
model is aligned with their business plans, increasing Mirada's
chance to land new deals. Both technical deployments ran smoothly,
helping to improve Mirada's efficiency as we accumulate deployments
of the Iris Inspire multiscreen product, and we plan to announce
the commercial launch of both customers within this fiscal
year.
In the case of ATNi, we plan to announce the first deployment
very shortly, with others following over this and the next fiscal
year. Recurrent (monthly / quarterly) subscriber-based licence fees
from both customers will start on the commercial deployments and
ramp-up as these customers grow.
Our largest reference, izzi Telecom (part of the Televisa Group)
continued to experience uncertainties resulting from the election
of Donald Trump as president of the United States of America. izzi
Telecom drastically decreased investments in foreign goods and
services denominated in US Dollars, which is our default trading
currency out of Europe. This had a short-term impact in the
professional services contracted by izzi Telecom, especially during
the first half of the year. This situation normalised after a few
months, with higher confidence in the market during the second half
of 2017. Additionally, post year end, in preparation for the FIFA
World Cup there was a peak in related required professional
services from izzi and other customers which will positively impact
our revenues for the fiscal year ended 31 March 2019.
As a result of the continued relationship with izzi Telecom, and
the successful deployment of our Iris Inspire solution, izzi
decided to extend the deployment of the solution over a wider
segment of its customer base. Mirada's product is now being
installed over the middle and premium tiers, which has resulted in
higher monthly installations and a post-year end increase of more
than $1.5m in licence-fee, collections since April 2018. On the
Over the Top (OTT) licences, the penetration of this product in the
market is growing to ratios comparable to other regions like
Western Europe, where households with OTT services added to the
traditional Pay-TV subscription represent over 50% of the
subscribers. Post year end, and using the FIFA World Cup momentum,
izzi decided to promote their OTT service for users which have not
currently installed Mirada's product in their households, and which
still represent the vast majority of their subscriber's base. izzi
is committed to the promotion of Mirada's OTT product over their
platform, and we expect this to be reflected positively in our
OTT-related revenues this year.
At 31 March 2018 izzi Telecom had over a million set-top boxes
installed with our product, in nearly five hundred-thousand
households. Currently izzi Telecom has over 4 million subscribers,
of which Mirada represented roughly 13% of their base at fiscal
year-end. At the present date, izzi Telecom has 1.5 million set-top
boxes installed with our technology.
The Group remains committed to its sales and marketing efforts,
and aims to close more deals in the present fiscal year. The
pipeline continues to grow, powered by the increasing number of
references and a very solid product, and the fact that our main
customers are intensively using our technology at the forefront of
their service delivery. The fact that izzi Telecom decided to
actively promote our OTT product over their multi-million
subscription base is a very strong selling point that very few
competitors can match.
Our cashless payment parking (Mobile) division, independent from
our Digital TV division, continues to deliver solid growth with a
20% increase in revenue, generating profits before tax this year of
$0.2m (2017: $0.16m), contributing to 10.0% of total revenue in the
current year (2017: 8.6%).
In May 2018, post year-end, we suffered the tragic and sad loss
of Mr Javier Casanueva, who was a friend and a partner for many
years, and a cornerstone for the successful deployment of Mirada.
We will greatly miss him. Francis Coles, a long-standing
non-executive Director, took the role of non-executive Chairman
later in the month. We wish him the best for the new position.
With a growing pipeline, more references and a solid product
that our customers are using more and more, we can only aim to
continue deploying the business model and win more references. The
business model is proving solid and with a higher percentage of
revenues coming from recurrent subscriber-based licence fees, we
are steadily reaching the point of profitability. We could not do
all this without the continued support of our stakeholders:
employees, customers, suppliers, partners and investors, to whom we
are extremely grateful.
Financial overview
Revenue grew to $8.82 million (2017: $8.49 million). However,
there was a decrease in revenues with izzi Telecom (Televisa group)
after the Peso devaluation in December 2016 and izzi Telecom freeze
of purchases in USD. This was offset by the revaluation of USD vs
EUR, which has contributed to $0.63 million additional
revenues.
Although gross profit grew to $7.94 million (2017: $7.88
million), there is a noted decrease in the gross margin percentage
of 3.6% due to the additional cost associated with the increased
number of sales representatives. Staff costs have increased due to
the strengthening of the sales team and due to the contract wins
under the Software as a service business model (ATNi and Digital TV
cable). Operating loss decreased to GBP4.62 million (2017: GBP6.57
million). Adjusted EBITDA (as defined in Note 6) for the year
decreased to a loss of $1.12 million (2017: loss of $0.04 million)
resulting mainly from the efforts to win and deploy the new deals.
Amortisation charges increased to $3.35 million from $2.72 million,
due to increased product development investment, related to Cloud
and kids functionalities. There is a tax credit recognised in the
current period as a result of Mirada Iberia's capitalisation of
research and innovation tax deductions.
The Group reduced its net loss for the year to $4.87 million
compared to a loss of $7.10 million in the prior year. This
improvement, resulted from a combination of the following factors:
the one-off goodwill impairment applied in the financial year ended
in March 2017 and the different revenue mix from increased licences
this year.
Net Debt rose to $11.70 million (2017: $5.25 million) as a
result of increased product investment, lower than expected
Televisa revenue for the year, and the required investment in the
new contracts signed under the Software as a Service ("SaaS")
business model. Long term interest-bearing loans and borrowings
decreased by 14% to $2.48 million (2017: $2.88 million) and short
term borrowings increased to $11.16 million (2017: $2.66 million).
Trade receivables increased from $0.99 million to $1.38 million,
due to a $0.66m invoice to izzi Telecom billed in March 2018 and
collected in April 2018.
The Company signed two debt facilities with related parties, one
of GBP1.7 million in November 2017 which was converted post year
end (August 29(th) , 2018) into equity, and a GBP3.0 million
facility which was agreed to be capitalised alongside an additional
capital injection of GBP3.0 million. These are subject to
shareholder approval on October 4th, 2018. Both facilities were
provided by our largest shareholders, showing their commitment to
the business model. We are confident that the reduction in Net Debt
will help in deploying new opportunities, both from the additional
available working capital and due to the increased confidence of
our Customers in our ability to develop the contracts.
Other intangible assets have increased by $1.14m mainly due to
the increased valuation of the Euro against the US Dollar.
Cash at bank increased to $1.94 million from $0.28 million,
mainly due to the GBP3.0 million facility received from Kaptungs in
March 2018. Additional invoice discounting facilities of $1.34
million and unused short-term credit lines of $0.37 million were
available at the end of March 2018.
The Group used $1.7m of cash in operating activities in the year
(2017 - generated cash from operating activities of $3.3m) and
spent a further $3.9m (2017 - $3.5m) in investing activities,
primarily related to developing the Group's software platform. This
was funded through the facilities described above.
As set out in note 2 of the financial statements, given the
funding needs of the Group, a General meeting has been called for
October 4(th) , 2018, to approve a GBP3m cash injection required
for the Group to continue as a Going Concern. See Note 2 for
further details.
In this period, the Board decided to change the reporting
currency for this year due to the growing exposure to the US
Dollar, as all major contracts and most on the new potential deals
for the Company are denominated in this currency. Coupled with the
evolution of the business, the Group's shareholder base is now
largely comprised of foreign investors to whom financial reporting
in GBP is of limited relevance. Internally, the board also bases
its performance evaluation and the majority of investment decisions
on USD financial information. The exchange rate fluctuation between
GBP and USD from March 2017 to March 2018, (1: 1.24775 to 1:
1.40795) has resulted in a consequent currency translation gain of
$1 million.
Current Trading and Outlook
Mirada participated in a significant number of potential deals
during the year and is seen as an increasingly relevant supplier,
as new bids appearing in the market. I am glad to say that we
currently have a strong pipeline in terms of the number of
opportunities we are participating in. This pipeline and an
increasing number of successful references is helping us secure new
opportunities and we are confident of announcing new relevant
contract wins in the near future.
José-Luis Vázquez
Chief Executive Officer
27(th) September 2018
Mirada plc
Consolidated Statement of Comprehensive Income at 31 March
2018
2018 2017
(Restated)
$000 $000
Revenue 8,816 8,489
Cost of sales (874) (614)
------------------------------------------- ------------------------- -------------------------
Gross profit 7,942 7,875
Depreciation (73) (46)
Amortisation (3,352) (2,718)
Share-based payment charge (72) (69)
Staff costs (5,599) (4,802)
Goodwill impairment - (3,744)
Other administrative expenses (3,464) (3,070)
------------------------------------------- ------------------------- -------------------------
Total administrative expenses (12,560) (14,449)
Operating loss (4,618) (6,574)
Finance income 84 3
Finance expense (634) (423)
Loss before taxation (5,168) (6,994)
Taxation 298 (103)
Loss for year (4,870) (7,097)
------------------------------------------- ------------------------- -------------------------
Currency translation differences 999 (763)
Total comprehensive loss for the period (3,871) (7,860)
------------------------------------------- ------------------------- -------------------------
Loss per share Year ended 31 March 2018 Year ended 31 March 2017
(Restated)
$ $
Loss per share for the year
- basic & diluted (0.035) (0.051)
Mirada plc
Consolidated Statement of Financial Position as at 31 March
2018
Company number 3609752 2018 2017 2016
(Restated) (Restated)
$000 $000 $000
Goodwill 6,492 5,643 10,111
Other Intangible assets 7,072 5,936 5,580
Property, plant and equipment 247 141 135
Deferred Tax Assets - - 568
Other Receivables 308 635 274
--------------------------------------------------------------------------------- --------- ----------- -----------
Non-current assets 14,119 12,355 16,668
--------------------------------------------------------------------------------- --------- ----------- -----------
Trade & other receivables 4,484 3,214 5,418
Cash and cash equivalents 1,937 277 1,025
--------------------------------------------------------------------------------- --------- ----------- -----------
Current assets 6,421 3,491 6,443
Total assets 20,540 15,846 23,111
--------------------------------------------------------------------------------- --------- ----------- -----------
Loans and borrowings (4,246) (2,655) (3,471)
Related parties loans and interests (6,917) - -
Trade and other payables (2,320) (1,384) (1,867)
Deferred income (1,360) (1,844) (326)
Current liabilities (14,843) (5,883) (5,664)
--------------------------------------------------------------------------------- --------- ----------- -----------
Net current liabilities (8,422) (2,392) 779
--------------------------------------------------------------------------------- --------- ----------- -----------
Total assets less current liabilities 5,697 9,963 17,447
--------------------------------------------------------------------------------- --------- ----------- -----------
Interest bearing loans and borrowings (2,477) (2,875) (2,542)
Other non-current liabilities - - (26)
Non-current liabilities (2,477) (2,875) (2,568)
--------------------------------------------------------------------------------- --------- ----------- -----------
Total liabilities (17,320) (8,758) (8,232)
--------------------------------------------------------------------------------- --------- ----------- -----------
Net assets 3,220 7,088 14,879
--------------------------------------------------------------------------------- --------- ----------- -----------
Issued share capital and reserves attributable to equity holders of the company
Share capital 2,261 2,261 2,261
Share premium 15,760 15,760 15,760
Other reserves 15,985 14,997 15,753
Accumulated loss (30,786) (25,930) (18,895)
Equity 3,220 7,088 14,879
--------------------------------------------------------------------------------- --------- ----------- -----------
Mirada plc
Consolidated Statement of changes in equity for the year ended
31 March 2018
Share capital Share premium Foreign exchange Merger reserves Accumulated Total
reserve losses
$000 $000 $000 $000 $000 $000
Balance at 1 April
2017 (Restated) 2,261 15,760 10,134 4,863 (25,930) 7,088
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Loss for the year - - - - (4,870) (4,870)
Other comprehensive
income
Movement in foreign
exchange - - 988 - 11 999
Total comprehensive
loss for the year 2,261 15,760 11,122 4,863 (30,789) 3,217
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Transactions with
owners
Share-based payment - - - - 3 3
Balance at 31 Mar
2018 2,261 15,760 11,122 4,863 (30,786) 3,220
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Share capital Share premium Foreign exchange Merger reserves Accumulated Total
reserve losses
$000 $000 $000 $000 $000 $000
Balance at 1 April
2016 (Restated) 2,261 15,760 10,890 4,863 (18,895) 14,879
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Loss for the year - - - - (7,097) (7,097)
Other comprehensive
income
Movement in foreign
exchange - - (756) - (7) (763)
Total comprehensive
loss for the year 2,261 15,760 10,134 4,863 (25,999) 7,019
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Transactions with
owners
Share-based payment - - - - 69 69
Balance at 31 March
2017 (Restated) 2,261 15,760 10,134 4,863 (25,930) 7,088
--------------------- -------------- -------------- --------------------- ---------------- ------------ --------
Mirada plc
Consolidated statement of cash flows for the year ended 31 March
2018
2018 2017
(Restated)
$000 $000
Cash flows from operating activities
Loss after tax (4,870) (7,097)
Adjustments for:
Depreciation of property, plant and equipment 73 46
Amortisation of intangible assets 3,352 2,718
Goodwill impairment charge - 3,744
Share-based payment charge 72 69
Finance income (84) (3)
Finance expense 634 423
Taxation (298) 103
Operating cash flows before movements in working capital (1,121) 3
(Increase) / Decrease in trade and other receivables (1,608) 2,251
Increase in trade and other payables 453 1,008
Taxation received 540 33
---------------------------------------------------------- -------- -----------
Net cash generated from operating activities (1,736) 3,294
Cash flows from investing activities
Interest and similar income received 84 3
Purchases of property, plant and equipment (161) (59)
Purchases of other intangible assets (3,780) (3,438)
---------------------------------------------------------- -------- -----------
Net cash used in investing activities (3,857) (3,494)
Cash flows from financing activities
Interest and similar expenses paid (634) (423)
Loans received 3,020 2,691
Related parties loans received 6,588 -
Repayment of loans (1,827) (2,821)
----------------------------------------------------------
Net cash from financing activities 7,147 (553)
Net increase in cash and cash equivalents 1,554 (753)
Cash and cash equivalents at the beginning of the period 277 1,025
Exchange losses on cash and cash equivalents 106 5
Cash and cash equivalents at the end of the year 1,937 277
---------------------------------------------------------- -------- -----------
Mirada plc
Notes to financial statements Year ended 31 March 2018
The following selected notes are extracted from the full Annual
Report
1. General information
Mirada plc is a company incorporated in the United Kingdom. The
address of the registered office is 68 Lombard Street, London, EC3V
9LJ. The nature of the Group's operations and its principal
activities are the provision and support of products and services
in the Digital TV and Broadcast markets.
In accordance with section 435 of the Companies Act 2006, the
Directors advise that the financial information set out in this
announcement does not constitute the Group's statutory financial
statements for the year ended 31 March 2017 or 2018 but is derived
from them. The financial statements for the year ended 31 March
2017 have been audited and filed with the Registrar of Companies.
The financial statements for the year ended 31 March 2018 have been
audited and will be filed with the Registrar of Companies following
the Company's Annual General Meeting. The Independent Auditors
Report on the Group's statutory financial statements for the years
ended 31 March 2018 and 2017 were unqualified and did not contain
statements under Section 498(2) or (3) of the Companies Act 2006.
They did, however, draw attention to the material uncertainty
related to Going Concern. The audit report for the year ended 31
March 2018 contains the following wording:
We draw attention to note 2 to the financial statements
concerning the parent company and group's ability to continue as a
going concern. As discussed in note 2, the group's available
working capital may prove insufficient to cover both operating
activities and the repayment of its debt facilities and the
directors are planning to raise additional funding that is subject
to shareholder approval.
In order to obtain the necessary funding required, as announced
in the Circular on September 17, 2018, the Company will be holding
a General Meeting on October 4, 2018. In that General Meeting, it
will be proposed to increase the ordinary share capital by GBP6.0
million, of which GBP3.0 million of the consideration will be
received in cash. A further GBP3.0 million will be satisfied by
discharging Mirada Plc from its liability to pay Kaptungs GBP3.0
million in accordance with the terms of a Facility Letter signed in
March 2018, in consideration for the Company treating such
discharged amount as payment in full for the subscription of
300,000,000 ordinary shares of 1p each in the capital of the
Company at a subscription price of 1p per new ordinary share, each
credited as fully paid up.
As set out in note 2, a significant shareholder has provided the
Registrar of the Company with their Proxy voting in favour of both
the resolutions for approval at the General Meeting. In addition,
on 27 September, 2018, the directors received confirmation from
Kaptungs that GBP3.0 million in cash will be transferred to Mirada
Plc from Kaptungs, for the subscription of 300 million new Ordinary
Shares at 1p per share to be issued, as referred to above, on
approval of the resolutions at the General Meeting to be held on
October 4, 2018.
As stated in note 2 of the financial statements, these matters
indicate the existence of a material uncertainty which may cast
significant doubt about the Company and Group's ability to continue
as a going concern. The financial statements do not include the
adjustments that would result if the Company and Group were unable
to continue as a going concern. Our opinion is not modified in
respect of this matter.
The calculations supporting the going concern assessment require
management to make highly subjective judgements. We have therefore
spent significant audit effort in assessing the appropriateness of
the assumptions involved, and as such this has been identified as a
Key Audit Matter.
Our audit procedures included the following:
-- Review of the group's cash flow forecast and other
projections through to 31 March 2020, including assessing and
challenging assumptions used and performing sensitivity
analysis.
-- Reviewing the terms of the group's proposed re-financing,
specifically the 3 million proposed issue of share capital for
cash, which as at the time of signing these accounts is subject to
final shareholder approval at the General Meeting on October 4th,
2018.
-- Reviewing the disclosures in the financial statements.
The financial information included in this announcement has been
prepared in accordance with the recognition and measurement
requirements of International Financial Repeating Standards as
adopted for use in the EU but does not include all of the
disclosures required by those standards. The accounting policies
used in the preparation of the financial information are consistent
with those used in the group's financial statements for the year
ended 31 March 2018 and are unchanged from those set out in the
financial statements for the period ended 31 March 2017, except as
noted below:
In this period, the Board decided to change the reporting
currency due to the growing exposure to the US Dollar, as all major
contracts and most on the new potential deals for the Company are
denominated in this currency. The board therefore believes that USD
financial reporting provides more relevant presentation of the
group's financial position, funding and treasury functions,
financial performance and its cash flows. Coupled with the
evolution of the business, the group's shareholder base is now
largely comprised of foreign investors to whom financial reporting
in GBP is of limited relevance. Internally, the board also bases
its performance evaluation and many investment decisions on USD
financial information.
2. Significant accounting policies
Basis of accounting
These Group financial statements have been prepared in
accordance with International Financial Reporting Standards,
International Accounting Standards and Interpretations issued by
the International Accounting Standards Board as adopted by European
Union ("IFRSs") and with those parts of the Companies Act 2006
applicable to companies preparing their accounts under IFRSs.
Reporting currency
In this period, the Board decided to change the reporting
currency due to the growing exposure to the US Dollar, as all major
contracts and most on the new potential deals for the Company are
denominated in this currency. The board therefore believes that USD
financial reporting provides more relevant presentation of the
group's financial position, funding and treasury functions,
financial performance and its cash flows. Coupled with the
evolution of the business, the group's shareholder base is now
largely comprised of foreign investors to whom financial reporting
in GBP is of limited relevance. Internally, the board also bases
its performance evaluation and many investment decisions on USD
financial information.
It should be noted that the functional currencies of the group's
underlying businesses - functional currencies referring to the
currencies of the primary economic environments in which underlying
businesses operate - remain unchanged and that foreign exchange
exposures will therefore be unaffected by the change, albeit that
the effects of such exposures will be presented in USD.
To assist investors in understanding the change in accounting
policy, restated statements of financial position have been
presented, providing restated USD financial information for the
financial years ended 31 March 2017 and 2016. The six-month interim
periods ended 30 September 2017 and 2016 were also presented in USD
and are available online, as announced on December 20(th) ,
2017.
A change in reporting currency represents a change in an
accounting policy in terms of IAS 8 Accounting Policies, Changes in
Accounting Estimates and Errors requiring the restatement of
comparative information. In accordance with IAS 21 The Effects of
Changes in Foreign Exchange Rates, the following methodology was
followed in restating historical financial information from GBP
into USD:
-- Non-USD assets and liabilities were translated at the
relevant closing exchange rate at the end of the reporting period.
Non-USD items of income and expenditure and cash flows were
translated at average exchange rates for the reporting period
disclosed;
-- Share capital, premium and other reserves, as appropriate,
were translated at the historic rates prevailing at the dates of
underlying transactions; and
-- The effects of translating the group's financial results and
financial position into USD were recognised in the foreign currency
translation reserve.
The Group has provided the average exchange rates of its major
functional currencies relative to US dollar as an approximation for
these rates for reference in the following table. The closing
exchange rates of the group's major trading currencies relative to
US dollar, used when translating the statements of financial
position presented in this release into US dollar, are also
detailed in this table
31 March 2016 31 March 2017 31 March 2018
Average Closing Average Closing Average Closing
rate rate rate rate rate rate
Sterling - 1.4368 1.3071 1.2487 1.3268 1.4017
Euro - 1.1357 1.0976 1.0683 1.1705 1.2360
Mexican
peso - - 0.0521 0.0534 0.0541 0.0551
The cumulative foreign currency translation reserve was nil at
the date of transition to IFRS. All subsequent movements comprising
differences on the retranslation of the opening net assets of
non-sterling subsidiaries have been taken to the foreign currency
translation reserve. Share capital, share premium and other
reserves were translated at the historic rates prevailing at the
dates of transactions.
As per Statement GBP Currency Translation USD
of Financial effect
Position
31 March 2016 Total Assets 16,069 7,042 23,111
Total Liabilities (5,779) (2,453) (8,232)
Share Capital (1,391) (870) (2,261)
Share Premium (9,859) (5,901) (15,760)
Other reserves (3,033) (12,720) (15,753)
Accumulated
losses 3,993 14,902 18,895
31 March 2017 Total Assets 12,117 3,729 15,846
Total Liabilities (7,018) (1,740) (8,758)
Share Capital (1,391) (870) (2,261)
Share Premium (9,859) (5,901) (15,760)
Other reserves (3,303) (11,694) (14,997)
Accumulated
losses 9,454 16,476 25,930
The 2018 consolidation has been prepared in USD and not GBP as
the decision to change reporting currencies was taken during the
year. The currency translation effect has therefore not been
disclosed. Share capital, share premium and other reserves were
translated at the historic rates prevailing at the dates of
transactions giving rise to those equity items. The transfer
between reserves that arose on the capital reduction completed in
on 12 January 2011 has been recognised at the average rate that was
used to translate the shares cancelled.
Going concern
These financial statements have been prepared on the going
concern basis. The Directors have reviewed the Company and Group's
going concern position taking account of its current business
activities, budgeted performance and the factors likely to affect
its future development, which are set out in this Annual report,
and include the Group's objectives, policies and processes for
managing its capital, its financial risk management objectives and
its exposure to credit and liquidity risks.
As at 31 March 2018, the Group had cash and cash equivalents of
$1.94m (2017: $0.28m), net cash used in operating activities of
$1.74m (2017: net cash generated of $3.29m), realised a loss for
the year of $4.87m, (2017: a loss of $7.09m which included a
one-off goodwill impairment of $3.74m), net current liabilities of
$8.42m (2017: net current liabilities of $2.39m) and had net assets
of $3.22m (2017: $7.09m).
The directors have prepared cash flow forecasts covering a
period of at least 12 months from the date of approval of the
financial statements. If the forecast is achieved, the Group will
be able to operate within its existing facilities. However, the
time to close new customers and the value of each customer, which
are deemed high volume and low value in nature are factors which
constrain the ability to accurately predict revenue performance.
Furthermore, investment in winning customers, via marketing
expenditure, and servicing and delivering to new customers remains
an important function of the forecasts too. As such, there is a
risk that the group's working capital may prove insufficient to
cover both operating activities and the repayment of its debt
facilities. In such circumstances, the group would be obliged to
seek additional funding though a placement of shares or source
other funding. The directors have had a history of raising
financing from similar transactions.
On August 29(th) , 2018 the General Meeting approved the
conversion into shares of the GBP1.7m loan facility announced on
November 28(th) , 2017.
In order to obtain the necessary funding required, as announced
in the Circular on September 17, 2018, the Company will be holding
a General Meeting on October 4, 2018. In that General Meeting, it
will be proposed to increase the ordinary share capital by GBP6.0
million, of which GBP3.0 million of the consideration will be
received in cash. A further GBP3.0 million will be satisfied by
discharging Mirada Plc from its liability to pay Kaptungs GBP3.0
million in accordance with the terms of a Facility Letter signed in
March 2018, in consideration for the Company treating such
discharged amount as payment in full for the subscription of
300,000,000 ordinary shares of 1p each in the capital of the
Company at a subscription price of 1p per new ordinary share, each
credited as fully paid up.
On September 14, 2018, Kaptungs signed an irrevocable voting
undertaking referring the resolutions of the October 4, 2018,
General Meeting.
On September 21, 2018, Kaptungs provided the Registrar of the
Company with their Proxy voting in favour of both the resolutions
for approval at the General Meeting. As per the Circular, Kaptungs
has 60.82% of the voting rights of the Company.
On September 27, 2018, the directors received confirmation from
Kaptungs that GBP3.0 million in cash will be transferred to Mirada
Plc from Kaptungs on 28 September 2018, for the subscription of 300
million new Ordinary Shares at 1p per share to be issued, as
referred to above, on approval of the resolutions at the General
Meeting to be held on October 4, 2018. The money received was
requested to be paid before the General Meeting on October 4, 2018,
as it relates to the subscription of shares. The issue of ordinary
shares and the discharging of the loan facility are conditional,
inter alia, on the passing of the resolutions at the General
Meeting and Admission becoming effective. Application will be made
for the Subscription Shares and the Loan Capitalisation Shares to
be admitted to trading on AIM, conditional on the resolutions being
passed. It is expected that if the resolutions are passed,
Admission will occur at 8.00 a.m. on 5 October 2018.
The directors remark that Kaptungs is a strong supporter of the
Company after injecting $10m in cash between November 2017 and
September 2018. However, the risk that both resolutions are not
passed at the General Meeting on October 4, 2018, represents a
material uncertainty, which may cast a doubt about the Company and
Group's ability to continue as a going concern. Whilst recognising
this uncertainty, on the basis of the Proxy votes received to date,
and the strong support from Kaptungs, the directors believe that
the resolutions will be passed at the General Meeting on October 4,
2018, and the company and group will be able to continue as a going
concern. On this basis, these financial statements have been
prepared on a going concern basis.
Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
(its subsidiaries) made up to 31 March 2018.
Where the company has control over an investee, it is classified
as a subsidiary. The company controls an investee if all three of
the following elements are present: power over the investee,
exposure to variable returns from the investee, and the ability of
the investor to use its power to affect those variable returns.
Control is reassessed whenever facts and circumstances indicate
that there may be a change in any of these elements of control.
Revenue recognition
Interactive service revenues are divided into 4 types:
development fees, the sale of licences, managed services and
self-billing revenues.
Revenues from development fees (which include set-up fees):
these are recognised according to management's estimation of the
stage of completion of the project. This is measured by reference
to the amount of development time spent on a project compared to
the most up to date calculation of the total time estimated to
complete the project in full.
Sale of license: Revenue from licenses are earned from two
specific and separate streams.
1) Where the revenue relates to the sale of a one-off licence,
the licence element of the sale is recognised as income when the
following conditions have been satisfied:
-- The software has been provided to the customer in a form that
enables the customer to utilise it;
-- The ongoing obligations of the Group to the customer are minimal; and
-- The amount payable by the customer is determinable and there
is a reasonable expectation of payment.
2) Contracts licence fees payable by customers are dependent
upon the number of end user subscribers signing up to the
customer's digital television service. For this type of contract
revenues are recognised by multiplying the individual licence fee
by the net increase in the customer's subscriber base.
Revenues from Software as a Service (SaaS) - The Group licenses
software under licence agreements. Under this model, lower
integration set up fees than in other agreements are offset by
recurrent monthly licence fee revenues. License fee revenues are
recognised on practical acceptance of the software, when all
obligations have been substantially completed. This is when the
customer has accepted the product ie. the risks and rewards of
ownership have been transferred, it is probable that the economic
benefits of the transaction will flow to the Group, all costs and
revenue in relation to the transaction can reliably be measured.
Additionally, after deployment, the Group provides support and
maintenance services to the customer.
Managed services - revenue is measured on a straight-line basis
over the length of the contract. Where agreements involve multiple
elements, the entire fee from such arrangements is allocated to
each of the individual elements based on each element's fair value.
The revenue in respect of each element is recognised in accordance
with the above policies.
Self-billing revenues: These are earned through a revenue-share
agreement between Mirada and the customer which is presented in the
Mobile segment. The Group are informed by the customer of the
amount of revenue to invoice and the revenues are recognised in the
period these services are provided
Certain revenues earned by the Group are invoiced in advance. As
outlined in the revenue recognition policy above, revenues are
recognised in the period in which the Group provides the services
to the customer, revenues relating to services which have yet to be
provided to the customer are deferred.
Business combinations
Acquisitions of businesses are accounted for using the purchase
method. The cost of the acquisition is measured at the aggregate of
the fair values, at the date of exchange, of assets given,
liabilities incurred or assumed, and equity instruments issued or
to be issued, by the Group in exchange for control of the acquiree,
plus any costs directly attributable to the business combination.
The acquiree's identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS 3
are recognised at their fair value at the acquisition date.
Goodwill arising on acquisition is recognised as an asset and
initially measured at cost and is accounted for according to the
policy below.
Goodwill
Goodwill represents the excess of the cost of acquisition over
the Group's interest in the fair value of the identifiable assets
and liabilities of the acquired business at the date of
acquisition. Goodwill is initially recognised as an asset at cost
and is subsequently measured at cost less any accumulated
impairment losses.
On disposal of a subsidiary the attributable amount of goodwill
is included in the determination of the profit or loss on
disposal.
For the purpose of impairment testing, goodwill is allocated to
each of the Group's cash-generating units expected to benefit from
the synergies of the combination. Cash-generating units to which
goodwill has been allocated are tested for impairment annually, or
more frequently when there is an indication that the unit may be
impaired. If the recoverable amount of the cash-generating unit is
less than the carrying amount of the unit, the impairment loss is
allocated first to reduce the carrying amount of any goodwill
allocated to the unit and then to the other assets of the unit
pro-rata on the basis of the carrying amount of each asset in the
unit.
Other intangible assets
Intangible assets acquired as part of a business combination are
initially recognised at their fair value and subsequently amortised
on a straight line basis over their useful economic lives.
Intangible assets that meet the recognition criteria of IAS 38,
"Intangible Assets" are capitalised and carried at cost less
amortisation and any impairment losses. Intangible assets comprise
of completed technology, acquired software, capitalised development
costs and goodwill.
Amortisation of other intangible assets is calculated over the
following periods on a straight-line basis:
Completed technology - over a useful life of 4 years
Deferred development - over a useful life of 3 to 4
costs years
The amortisation is charged to administrative expenses in the
consolidated income statement. Completed technology relates to
software and other technology related intangible assets acquired by
the Group from a third party. Deferred development costs are
internally-generated intangible assets arising from work completed
by the Group's product development team.
Internally-generated intangible assets - research and
development expenditure
Any internally-generated intangible asset arising from the
Group's development projects are recognised only if all of the
following conditions are met:
-- The technical feasibility of completing the intangible asset
so that it will be available for use or sale.
-- The intention to complete the intangible asset and use or sell it.
-- The ability to use or sell the intangible asset.
-- How the intangible asset will generate probable future
economic benefits. Among other things, the Group can demonstrate
the existence of a market for the output of the intangible asset or
the intangible asset itself or, if it is to be used internally, the
usefulness of the intangible asset.
-- The availability of adequate technical, financial and other
resources to complete the development and to use or sell the
intangible asset.
-- Its ability to measure reliably the expenditure attributable
to the intangible asset during its development.
If a development project has been abandoned, then any
unamortised balance is immediately written off to the income
statement. Where no internally-generated intangible asset can be
recognised, development expenditure is recognised as an expense in
the period in which it is incurred. The amortisation is charged to
administrative expenses in the consolidated statement of
comprehensive income.
Impairment of non-current assets excluding deferred tax
assets
At each reporting date, the Group reviews the carrying amounts
of its tangible and intangible assets to determine whether there is
any indication that those assets have suffered an impairment loss.
If any such indication exists, the recoverable amount of the asset
is estimated in order to determine the extent of the impairment
loss (if any).
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset for
which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised in the
impairment of intangible assets line in the consolidated statement
of comprehensive income as an expense immediately.
Where an impairment loss subsequently reverses, the carrying
amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but so that the
increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised
for the asset (cash-generating unit) in prior periods. A reversal
of an impairment loss is recognised as income immediately.
Goodwill impairments are not reversed.
Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated
depreciation and any impairment in value.
Depreciation is provided on all property, plant and equipment,
other than freehold land, at rates calculated to write off the
cost, less estimated residual value based on current prices, of
each asset evenly over its expected useful life, as follows:
- Office & computer equipment 33.3% per annum
- Short-leasehold improvements 10% per annum
The carrying values of property, plant and equipment are
reviewed for impairment if events or changes in circumstances
indicate the carrying value may not be recoverable. The asset's
residual values, useful lives and methods are reviewed, and
adjusted if appropriate, at each financial period end.
Financial instruments
Financial assets and financial liabilities are recognised on the
Group's statement of financial position at fair value when the
Group becomes a party to the contractual provisions of the
instrument.
Trade receivables
Trade receivables represent amounts due from customers in the
normal course of business. All amounts are initially stated at
their fair value and are subsequently carried at amortised cost,
less provision for impairment which is calculated on an individual
customer basis, where there is objective evidence.
Cash and cash equivalents
Cash and cash equivalents include cash at hand and deposits held
at call with banks with original maturities of three months or
less.
Financial liabilities and equity instruments
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into. An equity instrument is any contract that evidences a
residual interest in the assets of the Group after deducting all of
its liabilities.
Equity instruments issued by the Company are recorded at the
proceeds received, net of direct issue costs.
Financial instruments issued by the Group are treated as equity
only to the extent that they do not meet the definition of a
financial liability. The Group's ordinary shares are classified as
equity. When new shares are issued, they are recorded in share
capital at their par value. The excess of the issue price over the
par value is recorded in the share premium reserve.
Incremental external costs directly attributable to the issue of
new shares (other than in connection with a business combination)
are recorded in equity as a deduction, net of tax, to the share
premium reserve.
Bank Borrowings
Interest-bearing bank loans are initially recorded at fair value
less direct issue costs. Finance charges are accounted for on an
accruals basis in the income statement using the effective interest
rate method and are added to the carrying amount of the instrument
to the extent that they are not settled in the period in which they
arise.
Trade payables
Trade payables are initially measured at fair value, and are
subsequently measured at amortised cost, using the effective
interest rate method.
Employee share incentive plans
The Group issues equity-settled share-based payments to certain
employees (including directors). These payments are measured at
fair value at the date of grant by use of the Black-Scholes pricing
model. This fair value cost of equity-settled awards is recognised
on a straight-line basis over the vesting period, based on the
Group's estimate of shares that will eventually vest and adjusted
for the effect of any non-market based vesting conditions. The
expected life used in the model has been adjusted, based on
management's best estimate, for the effects of non-transferability,
exercise restrictions, and behavioural considerations. A
corresponding credit is recorded in equity in the retained
earnings.
Leases
Leases taken by the Group are assessed individually as to
whether they are finance leases or operating leases. Leases are
classified as finance leases whenever the terms of the lease
transfer substantially all the risks and rewards of ownership to
the lessee. All other leases are classified as operating
leases.
Operating lease rental payments are recognised as an expense in
the statement of comprehensive income on a straight-line basis over
the lease term. The benefit of lease incentives is spread over the
term of the lease.
Taxation
The tax expense represents the sum of the current tax and
deferred tax charges.
The tax currently payable is based on taxable profit for the
period. Taxable profit differs from net profit as reported in the
income statement because it excludes items of income or expense
that are taxable or deductible in other years and it further
excludes items that are never taxable or deductible. The Group's
liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit, and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
recognised for all taxable temporary differences and deferred tax
assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities
are not recognised if the temporary difference arises from the
initial recognition of goodwill or from the initial recognition
(other than in a business combination) of other assets and
liabilities in a transaction that affects neither the tax profit
nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled, or the asset is
realised. Deferred tax is charged or credited in the income
statement, except when it relates to items charged or credited
directly to equity, in which case the deferred tax is also dealt
with in equity.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Group intends to settle its
current tax assets and liabilities on a net basis.
Research and development tax credit
Companies within the group may be entitled to claim special tax
allowances in relation to qualifying research and development
expenditure (e.g. R&D tax credits). The group accounts for such
allowances as tax credits, which means that they are recognised
when it is probable that the benefit will flow to the group and
that benefit can be reliably measured. R&D tax credits reduce
current tax expense and, to the extent the amounts due in respect
of them are not settled by the balance sheet date, reduce current
tax payable. A deferred tax asset is recognised for unclaimed tax
credits that are carried forward as deferred tax assets. They are
recognised to the extent that it is expected to be recoverable
against future taxable profits.
Retirement benefit costs
The Group operates defined contribution pension schemes. The
amount charged to the statement of comprehensive income in respect
of pension costs and other post-retirement benefits is the
contributions payable in the period.
Differences between contributions payable in the period and
contributions actually paid are shown as either accruals or
prepayments in the statement of financial position.
Foreign exchange
The individual financial statements of each group company are
presented in the currency of the primary economic environment in
which it operates (its functional currency). For the purpose of the
consolidated financial statements, the result and the financial
position of each group company are expressed in US Dollars, which
the presentational currency for the consolidated financial
statements.
On translation of balances into the functional currency of the
entity in which they are held, exchange differences arising on the
settlement of monetary items, and on the retranslation of monetary
items, are included in profit or loss for the period.
For the purpose of presenting consolidated financial statements,
the assets and liabilities of the Group's foreign operations are
translated at exchange rates prevailing on the reporting date.
Income and expense items are translated at the average exchange
rates for the period, unless exchange rates fluctuate significantly
during that period, in which case the exchange rates at the date of
transactions are used.
Exchange differences arising on translating the opening
statement of financial position and the current year income
statements are classified as equity and transferred to the Group's
foreign exchange reserve. Such translation differences are
recognised as income or as expenses in the period in which the
operations are disposed of.
Goodwill and fair value adjustments arising on the acquisition
of a foreign entity are treated as assets and liabilities of the
foreign entity and translated at the closing rate. The Group has
elected to treat goodwill and fair value adjustments arising on
acquisitions before the date of transition to IFRS as sterling
denominated assets and liabilities.
3. Critical accounting judgements and key sources of estimation uncertainty
Critical judgements in applying the Group's accounting
policies
In the application of the Group's accounting policies, which are
described in note 2, the directors are required to make judgements,
estimates and assumptions about the carrying amounts of assets and
liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis.
Key sources of estimation uncertainty and judgements
The following are the critical judgements that the directors
have made in the process of applying the Group's accounting
policies that has the most significant effect on the amounts
recognised in the financial statements.
Presenting financial information in USD
In this period, the Board decided to change the reporting
currency due to the growing exposure to the US Dollar, as all major
contracts and most on the new potential deals for the Company are
denominated in this currency. The board therefore believes that USD
financial reporting provides more relevant presentation of the
group's financial position, funding and treasury functions,
financial performance and its cash flows. Coupled with the
evolution of the business, the group's shareholder base is now
largely comprised of foreign investors to whom financial reporting
in GBP is of limited relevance. Internally, the board also bases
its performance evaluation and many investment decisions on USD
financial information.
Impairment of goodwill and intangibles
Determining whether goodwill is impaired requires an estimation
of the value in use of the cash-generating units to which goodwill
has been allocated. The value in use calculation requires the Group
to estimate the future cash flows expected to arise from the
cash-generating units and the estimated future cash flows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money
and the risks specific to the cash-generating unit. This includes
the directors' best estimate on the likelihood of current deals in
negotiation not yet concluded. Consequently, the outcome of
negotiations may vary materially from management expectation.
See note 12 for details of key assumptions and an assessment of
reasonable changes in key assumptions used in the impairment
test.
Capitalised development costs
Any internally generated intangible asset arising from the
Group's development projects are recognised only once all the
conditions set out in the accounting policy Internally Generated
Intangible Assets (refer to note 2) are met. The amortisation
period of capitalised development costs is determined by reference
to the expected flow of revenues from the product based on
historical experience. Furthermore, the Group reviews, at the end
of each financial year, the capitalised development costs for each
product for indications of any loss of value compared to net book
value at that time. This review is based on expected future
contribution less the total expected costs.
The Group capitalises spend on development new software and the
delivery of innovative software. Management exercises judgement in
establishing both the technical feasibility of completing an
intangible asset which can be sold, and the degree of certainty
that a market exists for the asset, or its output, based on
feedback from existing and potential customers, for the generation
of future economic benefits. In addition, amortisation rates are
based on estimates of the useful economic lives and residual values
of the assets involved.
4. Segmental reporting
Reportable segments
The chief operating decision maker for the Group is ultimately
the board of directors. For financial and operational management,
the board considers the Group to be organised into two operating
divisions based upon the varying products and services provided by
the Group - Digital TV & Broadcast and Mobile. The products and
services provided by each of these divisions are described in the
Strategic Report. The segment headed other relates to corporate
overheads, assets and liabilities.
Segmental results for the year ended 31 March 2018 are as
follows:
Digital Mobile Other Group
TV & Broadcast
$000 $000 $000 $000
Revenue 7,938 878 - 8,816
Segmental profit/(loss) (102) 209 (1,228) (1,121)
(Adjusted EBITDA,
see note 6)
Finance income - - 84 84
Finance expense - - (634) (634)
Depreciation (63) (10) - (73)
Amortisation (3,352) - - (3,352)
Share-based payment
charge - - (72) (72)
---------------- ------- -------- --------
Profit / (Loss) before
taxation (3,517) 199 (1,850) (5,168)
$1.228 million (2017: $1.16 million) disclosed as "Other"
comprises employment, legal, accounting and other central
administrative costs incurred at a Mirada Plc level.
The segmental results for the year ended 31 March 2017 are as
follows:
March 2017
Digital Mobile Other Group
TV & Broadcast
$000 $000 $000 $000
Revenue - 7,755 734 - 8,489
Segmental profit/(loss) 957 162 (1,160) (41)
(Adjusted EBITDA,
see note 6)
Finance income - - 3 3
Finance expense - - (423) (423)
Depreciation (44) (2) - (46)
Amortisation (2,715) (3) - (2,718)
Goodwill impairment
charge (3,744) - - (3,744)
Share-based payment
charge - - (69) (69)
Irrecoverable sales
tax expense 44 - - 44
---------------- ------- -------- --------
Profit / (Loss) before
taxation (5,502) 157 (1,649) (6,994)
There is no material inter-segment revenue.
The Group has a major customer in the Digital TV and Broadcast
segment that generates revenues amounting to 10% or more of total
revenue that account for $5.2 million of $8.8m total revenue. This
is approximately 61% of all revenue (2017: $6.0 million, out of
$8.5m) of the total Group revenues.
The segment assets and liabilities at 31 March 2018 are as
follows:
Assets 31.03.18
Digital Mobile Other Group
TV
$000 $000 $000 $000
Additions to non-current
assets 3,941 - - 3,941
Total assets 13,612 194 6,734 20,540
Total liabilities (9,590) (74) (7,656) (17,320)
Capital expenditure comprises additions to property, plant and
equipment and intangible assets.
The segment assets and liabilities at 31 March 2017 are as
follows:
Assets Liabilities Assets Liabilities
2018 2018 2017 2017
$000 $000 $000 $000
Digital TV - Broadcast
& Mobile 13,807 9,664 10,151 8,118
Other:
Goodwill 6,492 - 5,643 -
Other financial assets
& liabilities 241 7,656 52 640
Total other 6,733 7,656 5,695 640
Total Group assets
and liabilities 20,540 17,320 15,846 8,758
Segment assets and liabilities are reconciled to the Group's
assets and liabilities as follows:
Assets allocated to a segment consist primarily of operating
assets such as property, plant and equipment, intangible assets,
goodwill and receivables.
Liabilities allocated to a segment comprise primarily trade
payables and other operating liabilities.
Geographical
disclosures
External revenue Total assets by
by location of
customer
location of assets
2018 2017 2018 2017
$000 $000 $000 $000
Mexico 5,466 6,630 6 17
Europe 2,010 1,859 20,534 15,829
Other Americas 1,267 - - -
Asia 73 - - -
---------------- ---------------- -------
8,816 8,489 20,540 15,846
Revenues by Products:
Digital Mobile Digital Mobile
TV & Broadcast 2018 TV & Broadcast 2017
2018 2017
$000 $000 $000 $000
Development 4,363 - 5,541 -
Transactions - 878 - 734
Licenses 2,581 - 1,114 -
Managed Services 994 - 1,100 -
7,938 878 7,755 734
5. Operating loss
This has been arrived at after charging:
2018 2017
$000 $000
Depreciation of owned assets (note
13) 73 46
Amortisation of intangible assets (note
12) 3,352 2,718
Goodwill impairment charge (note 12) - 3,744
Operating lease charges 473 411
Analysis of auditors' remuneration is as follows:
2018 2017
$000 $000
Fees payable to the company's auditor
for the audit of the company's annual
accounts 87 74
Audit of the account of subsidiaries 34 17
Reconciliation of operating profit for continuing operations to
adjusted earnings before interest, taxation, depreciation and
amortisation:
2018 2017
$000 $000
Operating loss (4,618) (6,574)
Depreciation 73 46
Amortisation 3,352 2,718
Goodwill impairment charge (note 12) - 3,744
Operating profit/loss before interest,
taxation, depreciation, amortisation,
impairment (EBITDA) (1,193) (66)
Share-based payment charge 72 69
Irrecoverable sales tax income - (44)
Adjusted EBITDA (1,121) (41)
======== ========
6. Taxation
The tax assessed on the loss on ordinary activities for the
period differs from the standard rate of tax of 19% (2017-20%). The
differences are reconciled below:
2018 2017
$000 $000
Loss before taxation (5,168) (6,994)
Loss on ordinary activities
multiplied by 19% (2017:
20%) (982) (1,399)
Losses carried forward 982 1,399
Withholding Taxes 125 135
-------- --------
Total current tax 125 135
Decrease of deferred tax
assets 39 495
Subtotal 164 630
R&D (497) (491)
Foreign exchange 35 (36)
Total tax (credit)/expense (298) 103
======== ========
Deferred Taxation
Deferred tax assets related to tax losses were reduced by
$495,000 during FY17 in Mirada Iberia S.A. Foreign exchange
differences of $44,000 arising on consolidation of the deferred tax
asset were recognised in other comprehensive income.
Deferred tax assets related to tax losses were reduced by
$30,000 during FY18 in Mirada Connect. Foreign exchange differences
of $8,000 arising on consolidation of the deferred tax asset were
recognised in other comprehensive income.
Reconciliation of deferred tax asset and liabilities:
Reconciliation of deferred tax asset
and liabilities
2018 2017
Asset Asset
$000 $000
Balance at 1 April 30 569
Reversal of Deferred tax
asset (39) (495)
Foreign exchange 9 (44)
Balance at the end of year - 30
Deferred taxation amounts not recognised are as follows:
Group Group Group Company Company
2018 2017 2018 2017
$000 $000 $000 $000
Losses 16,272 15,290 23,870 22,459
Research & Development
Tax Credits, 3,082 2,739 - -
useable against future
profits
------- ------- -------- --------
Balance at the end of
the year 19,354 18,029 23,870 22,459
The gross value of tax losses carried forward at 31 March 2018
equals $78.0 million (2017: $70.0 million).
The deferred tax asset for the company has not been recognised
on the grounds that there is insufficient evidence at the balance
sheet date that it will be recoverable. The asset would start to
become potentially recoverable if, and to the extent that, the
company were to generate taxable income in the future.
7. Earnings per share
Year ended Year ended
31 March 31 March
2018 2017
Total Total
Loss for year $(4,870,019) $(7,096,551)
Weighted average number
of shares 139,057,695 139,057,695
Basic loss per share $(0.035) $(0.051)
Diluted loss per share $(0.035) $(0.051)
The Company has 4,697,166 (2017: 4,697,166) potentially dilutive
ordinary shares arising from share options issued to staff.
However, in 2018 and 2017 the loss attributable to ordinary
shareholders and weighted average number of ordinary shares for the
purpose of calculating the diluted earnings per ordinary share are
identical to those used for basic earnings per ordinary share. This
is because the exercise of share options would have the effect of
reducing the loss per ordinary share and is therefore
anti-dilutive.
8. Share capital
A breakdown of the authorised and issued share capital in place
as at 31 March 2018 is as follows:
2018 Number 2018 2017 Number 2017
$000 $000
Allotted, called up and fully
paid
Ordinary shared of GBP0.01 139,057,695 2,261 139,057,695 2,261
9. Events after the reporting date
Refer to note 2 of the financial statements for detail on events
after the reporting date.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR GUGDCIXDBGII
(END) Dow Jones Newswires
September 28, 2018 02:02 ET (06:02 GMT)
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