TIDMMIRA
RNS Number : 1487T
Mirada PLC
16 July 2020
Prior to publication, certain information contained within this
announcement was 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,
this information is now considered to be in the public domain.
16 July 2020
Mirada plc
("Mirada", the "Company" or the "Group")
Final results for the year ended 31 March 2020
Mirada plc (AIM: MIRA), a leading provider of integrated
software and solutions for Digital TV operators and broadcasters,
announces its final results for the year ended 31 March 2020.
Financial Highlights
-- Revenue increase of 7% to $13.16 million (2019: $12.32
million). Excluding Mirada Connect (sold in July 2019), revenue
increased 13% to $12.96 million (2019: $11.49 million).
-- Adjusted EBITDA (as defined in Note 6 below) increased 207%
to $2.50 million (2019: $0.81 million).
-- Gross profit increased 9% to $12.48 million (2019: $11.47 million).
-- Mirada Connect Ltd sold in July 2019 for GBP2.12m (equivalent
to $2.61m) providing a one-off net gain of $1.7m.
-- Net profit increased to $0.59 million (2019: loss of $3.11 million).
-- Net debt at 31 March 2020 increased to $5.05 million (2019:
$4.86 million). See note 20 for further details.
-- New EUR1.30 million credit facility granted by Leasa Spain, S.L.U.
Operational Highlights
-- Successful development of Mirada's Android TV custom
launcher, resulting from close collaboration with Google and izzi
Telecom. This will increase Mirada's pipeline by adding Android TV
projects.
-- Integration of Netflix within Mirada's Iris multiscreen
product and deployment in izzi Telecom's pay TV platform.
-- Deployment of Iris multiscreen licences over new segments of
subscribers at izzi Telecom, reaching 2.8 million STBs
(Set-Top-Boxes) installed by March 2020.
-- Contract win with Plataforma Multimedia de Operadores in
Spain in September 2019, with potential to become Mirada's largest
European deployment to date.
-- Successful transition to remote working due to COVID-19 without operational disruption.
Commenting on the outlook for the Group, Jos é Luis V á zquez,
CEO of Mirada, said:
"Despite the uncertain impact of COVID-19, Mirada's financial
position is continuously improving, reinforced by the support of
its largest shareholder. Together, these factors have led to an
improved commercial performance, with participation in multiple
deals which, combined with the growing pipeline, provide confidence
in the Company's ability to secure more contract wins in the coming
years."
Annual Report and Accounts
The Company's Annual Report and Accounts are available on the
Company website, www.mirada.tv and will be posted to shareholders
in the next few weeks, along with notice of the Annual General
Meeting.
Enquiries:
Mirada plc +44 (0) 207 868 2104
José Luis Vázquez, Chief Executive investors@mirada.tv
Officer
Gonzalo Babío, Finance Director
Newgate Communications +44 (0) 207 653 9850
Bob Huxford mirada@newgatecomms.com
Tom Carnegie
Allenby Capital Limited (AIM Nominated
Adviser & Broker)
Jeremy Porter / Liz Kirchner (Corporate
Finance)
Guy McDougall (Sales & Corporate Broking) +44 (0) 203 328 5656
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 Report
Overview
We present the Group's financial results for the year ended 31
March 2020. The year ended during a global pandemic, which is still
with us today and continues to have devastating effects across the
world. Our thoughts and prayers are with all those affected.
For Mirada, even discounting the one-off effect of the disposal
of the non-core parking payment activities of Mirada Connect, last
year saw a significant improvement financially, operationally, and
commercially. Despite having incurred an operating loss of $1.36m
(2019: $2.91m), the Company's performance has dramatically improved
over the past 12 months, with remarkable growth in adjusted EBITDA.
Operationally, the Group has been able to augment itself to fully
deploy its flagship Iris solution across different markets.
Commercially, Mirada has benefited from the references provided by
its prior successful deployments, which have reinforced the Group's
presence and credibility in the market.
The main highlights for the year were the integration with
Netflix, our new contract win with PMO (Plataforma Multimedia de
Operadores) in Spain, and the sale of Mirada Connect, among others.
These provide further proof of the quality of our solution and are
important steps forward in achieving a greater market footprint and
solid financial stability. In addition, we have a growing
proportion of recurrent revenues from present customers, and
confidence that our operational skills will enable us to continue
to deliver for our customers. We therefore view the year ahead with
cautious optimism, despite the uncertainties of the present health
and economic environment.
Trading Review
This was the first year the Group's sole focus was on its main
area of business, the Digital TV sector. In July, the mobile
payments for parking division, Mirada Connect, was acquired by
PayByPhone, a subsidiary of Volkswagen Financial Services, for a
consideration of GBP2.12 million, representing a one-off gain in
profit of approximately $1.7 million for the Group. This was an
important and positive development for the Company, allowing it to
reinforce the balance sheet and to focus the management on the core
Digital TV business. Mirada's main product, the Iris platform,
continued to gain traction across its installed customer base and
the Company was successful in winning new customers during the
year. The Company has continued deploying its business model, to
benefit from the growth of its customers, and we are pleased to see
how our customers' subscriber bases using Mirada's products
continue to grow.
Within our largest customer, izzi telecom, based in Mexico, the
use of our technology continues to grow rapidly, with more than 2.8
million Linux-based set-top boxes (STBs) deployed at the end of the
fiscal year in approximately 1.5 million households. Significantly,
more than 1 million households are now using izzi's over-the-top
(OTT) product (based on mobile devices and web browsers) supplied
by Mirada. While the customer adoption of Mirada's products remains
high, there is still a large part of izzi's installed base to
cover, as it has in excess of 4.2 million pay TV customers,
representing more than 8 million STBs, and our expectation is that
nearly two thirds of the installed base will still need to be
replaced with Mirada's technology.
During the year, Mirada has also been focused on deploying the
next-generation service at izzi, based on Android TV technology,
which is likely to become the largest Google-based set-top box
deployment in the Americas to date.
Regarding ATN International, our Atlanta-based customer with a
footprint in the Caribbean and mainland US, we are happy to have
delivered our solution in their Bermuda cable network, One
Communications, where our solution now covers the vast majority of
households. Mirada is now focused on the deployment in Viya, ATN
Internationals' US Virgin Islands network, which will launch our
product in the next few weeks.
Regarding Digital TV Edmund, in Bolivia, the customer is slowly
solving internal technical problems that delayed the deployment of
our solution, and we foresee those being resolved in the next few
months. In the meantime, we continue providing support to their
operations while they work to fully deploy their pay TV service.
Within this customer we are glad to announce the first
certifications of our Smart TV technology and our Roku based
services.
We are also happy to report a much larger than expected adoption
of Iris in SkyTel, our Mongolian customer. Our expectation was to
have less than 10,000 of their customers subscribe to our services
in the first year of operation. However, by the end of March, in
less than nine months, the customer was providing our technology to
more than 280,000 subscribers, and our mobile applications in
Android and iOS were both number one for the whole country in the
Google Play and Apple Store services.
We secured a new customer in September, Plataforma Multimedia de
Operadores (PMO), in Spain, which, under the "Zapi" brand,
aggregates a substantial number of subscribers across multiple
independent telecommunication suppliers in the country. We have
been working hard to finalise the integration activities since the
contract win and, with integration and deployment timelines
improving with each new customer we win, we hope to launch
commercially in the next few weeks. Zapi has the potential to reach
hundreds of thousands of customers in Spain, becoming our largest
deployment of Iris in Europe to date.
The entire Group was able to transition to complete remote
working practices at the beginning of March due to the outbreak of
COVID-19, and we are satisfied to note that, more than three months
into this new scenario, operations remain perfectly normal with no
impact on our capability to deliver our products and services. Our
customers, which are mostly telecommunications providers of TV
services, have become even more invaluable to consumers and have
experienced a unprecedented increase of nearly 25% in linear TV
consumption and more than 40% for video on-demand (VoD)
consumption. In addition, broadband usage has increased over 30% in
our customers' networks. This increase in our customers' activities
has made our visibility of revenues for the coming year much higher
at this stage than in any other prior year. This lends us
confidence in our abilities to continue our business without
disruption over the coming months.
Our pipeline also remains strong, despite the difficult
confinement and uncertain situation imposed by the COVID-19
pandemic, although we are conscious that, until the pandemic
resides, there could be delays in decisions from new customers.
Although our customers, and the sector at large, are currently
benefiting from the sharp rise in demand for audiovisual and
connectivity services, it is still too early to predict if the
potential reduction in the purchasing power of consumers will have
an overall negative impact in the telco and pay TV business.
As part of our SaaS strategy, Mirada has been able to agree long
term contracts with key customers, with an increasing recurrent
revenue component. This allows our customers to benefit from
continuous product improvement and aligns their long-term growth
objectives to ours, as we benefit from growth in their subscriber
numbers. While it usually means a higher level of investment during
the deployment stage, which is not being capitalised, it also
provides Mirada with an improved medium and long-term return on
investment. The efforts made during prior years on winning and
deploying customers are now providing a higher level of recurrent
revenue as well as visibility over future revenues. This is
ultimately increasing our total turnover, reducing operational
losses and allowing the Group to steadily approach a stage of
sustained profitability.
The Group continues to deliver high quality products for the
audiovisual sector, and we are delighted with the growing relevance
Mirada is enjoying in the market. There has been a substantial
improvement in our EBITDA level, and the Board continues to believe
that the Company is close to a point of sustained profitability. In
these difficult times we are grateful to be working in a business
that can continue providing quality experiences to millions of
users, and we would like to express our sincere gratitude to our
fantastic group of employees, customers, suppliers, partners and
investors.
Financial Overview
Revenue grew to $13.16 million (2019: $12.32 million), a 7%
year-on-year increase. Excluding Mirada Connect, which was sold in
July 2019, revenue grew to $12.96 million (2019: 11.49 million), a
13% year-on-year increase. Growth in development revenue was
$1.47million to reach $7.98 million for the year, driven by the
customisation of the Android TV custom launcher for izzi
Telecom.
Gross profit grew to $12.48 million (2019: $11.46 million) and
operating losses reduced to $1.36 million (2019: $2.91 million).
Staff Costs decreased by $0.46 million to $6.79 million (2019:
$7.25 million) and other administrative expenses decreased by $0.20
million to $3.20 million (2019: $3.40 million). The improvement in
revenues and the reduction in costs led to an adjusted EBITDA (as
defined in Note 8) of $2.50 million (2019: $0.81 million). There is
a tax credit recognised in the current period of $0.31 million
(2019: $0.18 million) as a result of Mirada Iberia's research and
innovation tax deductions. As a result, the net impact was the
achievement of net profit for the year of $0.59 million (2019: loss
of $3.11 million).
Net Debt increased to $5.05 million (2019: $4.86 million). Long
term interest-bearing loans and borrowings increased by 40% to
$2.40 million (2019: $1.72 million) and short term borrowings and
related party loans and interest decreased to $2.85 million (2019:
$3.26 million) - see note 20 for further details. Trade receivables
increased from $1.89 million to $1.99 million, due to increased
revenues and activity at the end of the fiscal year. A new EUR1.30
million credit facility was granted by Leasa Spain, S.L.U., owned
by Mr. Ernesto Luis Tinajero Flores, who also owns 87.21% of the
voting rights of Mirada plc.
Other intangible assets have increased by $0.78 million, mainly
due to the development of our custom launcher for Android TV.
The Group generated $1.80 million of cash in operating
activities in the year (2019: cash used in operating activities of
$1.24 million), received $2.61 million from the disposal of Mirada
Connect and spent a further $4.38 million (2019: $3.07 million) in
investing activities. The operating and investing cash flows were
funded by the movement in net debt explained above. This resulted
in an increase in cash and cash equivalents of $0.06 million.
The General Meeting held on 10 September 2019 approved a 100 to
1 share consolidation. The total outstanding share options on 9
September 2019 was 4,148,316 (4,697,166 at 30 September 2018).
Therefore, as of 31 March 2020, the total outstanding share options
was 41,483.
The Company has adopted the following new accounting standards
with effect from 1 April 2019:
IFRS 16- Leases
IFRIC 23 Uncertainty over Income Tax Treatments
Amendments to IFRS 9 Prepayment Features with Negative
Compensation
Amendments to IAS 28 Long-term Interests in Associates and Joint
Ventures
Amendments to IAS 19 Employee Benefits
Annual Improvements to IFRS Standards 2015-2017 Cycle
See note 3 to the financial statements for further information
on the new IFRS standards.
Current Trading and Outlook
Mirada is focused on the Digital TV segment and is increasing
its market reach, with a growing healthy pipeline of opportunities
as a result of the successful deployment and a wide appraisal of
its Iris multi-platform product for both Linux and Android TV
solutions, and the integration of Netflix. The Company is now
considered to be a top-end solution for potential customers, with a
flexible model that allows audiovisual companies of any size to
provide a competitive offering for their subscribers.
Despite the uncertain impact of COVID-19, Mirada's financial
position is continuously improving, reinforced by the support of
its largest shareholder. Together, these factors have led to an
improved commercial performance, with participation in multiple
deals, which, combined with the growing pipeline, provides
confidence in the Company's ability to secure more contract wins in
the coming years.
José-Luis Vázquez
Chief Executive Officer
15(th) July 2020
Consolidated Statement of Comprehensive Income for the year
ended
31 March 2020
2020 2019
$000 $000
Revenue 13,157 12,322
Cost of sales (676) (857)
Gross profit 12,481 11,465
Depreciation (360) (80)
Amortisation (3,499) (3,578)
Share-based payment charge - (70)
Staff costs (6,790) (7,249)
Other administrative expenses (3,196) (3,402)
Total administrative expenses (13,845) (14,379)
Operating loss (1,364) (2,914)
Gain on disposal of Mirada Connect 1,699 -
Non operating profit 1,699 -
Finance income 65 141
Finance expense (177) (523)
Foreign currency translation differences 52 -
Profit/(loss) before taxation 275 (3,296)
Taxation 313 184
Profit/(loss) for year 588 (3,112)
Other comprehensive income for the period
Amounts that will or may be reclassified
to the profit or loss
Forex on translation of foreign operations 2,888 (565)
Total comprehensive profit/(loss) for
the period 3,476 (3,677)
Earning/(loss) per share Year ended Year ended
31 March 31 March
2020 2019
$ $
Earning/(loss) per share for the year
- basic & diluted 0.001 (0.006)
Consolidated Statement of Financial Position as at 31 March
2020
2020 2019
$000 $000
Goodwill 5,098 5,924
Other Intangible assets 6,631 5,855
Right of use assets 482 -
Property, plant and equipment 228 222
Other Receivables 486 398
Non-current assets 12,925 12,399
Trade & other receivables 6,966 5,421
Cash and cash equivalents 185 117
Current assets 7,151 5,538
Total assets 20,076 17,937
Loans and borrowings (2,820) (3,257)
Related parties loans and interests (7) -
Trade and other payables (2,019) (1,958)
Deferred income (1,785) (1,019)
Lease liabilities (229) -
Current liabilities (6,860) (6,234)
Net current assets/(liabilities) 291 (696)
Total assets less current liabilities 13,216 11,703
Related parties loans (1,210) -
Interest bearing loans and borrowings (1,195) (1,721)
Lease liabilities (259) -
Non-current liabilities (2,664) (1,721)
Total liabilities (9,524) (7,955)
Net assets 10,552 9,982
Issued share capital and reserves
attributable to equity holders
of the company
Share capital 12,015 12,015
Share premium - 15,995
Other reserves 18,286 15,398
Accumulated loss (19,749) (33,426)
Equity 10,552 9,982
Consolidated Statement of changes in equity for the year ended
31 March 2020
Share Share Foreign Merger Accumulated Total
capital premium exchange reserves losses
reserve
$000 $000 $000 $000 $000 $000
Balance at 1 April 2019 12,015 15,995 10,535 4,863 (33,426) 9,982
Profit for the year - - - - 588 588
Other comprehensive income
Movement in foreign exchange - - 2,888 - - 2,888
Total comprehensive income
for the year - - 2,888 - 588 3,476
Transactions with owners
Share premium cancelation - (15,995) - - 13,089 (2,906)
Balance at 31 March 2020 12,015 - 13,423 4,863 (19,749) 10,552
Share Share Foreign Merger Accumulated Total
capital premium exchange reserves losses
reserve
$000 $000 $000 $000 $000 $000
Balance at 1 April 2018 2,261 15,760 11,122 4,863 (30,786) 3,220
Prior Year Adjustment-IFRS
15 (Note 2) - - - - 380 380
Loss for the year - - - - (3,112) (3,112)
Other comprehensive income
Movement in foreign exchange - - (587) - 22 (565)
Total comprehensive loss
for the year - - (587) - (2,710) (3,297)
Transactions with owners
Share-based payment - - - - 70 70
Conversion of convertible
loans into shares 5,858 235 - - - 6,093
Issue of shares 3,896 - - - - 3,896
Balance at 31 March 2019 12,015 15,995 10,535 4,863 (33,426) 9,982
Consolidated Statement of Cash Flows for the year ended 31 March
2020
2020 2019
$000 $000
Cash flows from operating activities
Profit/(loss) after tax 588 (3,112)
Adjustments for:
Depreciation of property, plant and
equipment 360 80
Amortisation of intangible assets 3,499 3,578
Share-based payment charge - 70
Finance income (65) (141)
Finance expense 177 523
Foreign currency translation differences (52) -
Taxation (313) (184)
Gain on disposal of Mirada Connect (1,699) -
Operating cash flows before movements
in working capital 2,495 814
Increase in trade and other receivables (2,011) (1,654)
Increase/(decrease) in trade and other
payables 1,065 (703)
Interest paid (14) -
Taxation received 265 307
Net cash used in operating activities 1,800 (1,236)
Cash flows from investing activities
Interest and similar income received 65 141
Purchases of property, plant and equipment (126) (80)
Purchases of other intangible assets (4,319) (3,127)
Cash proceeds from sale of Mirada Connect 2,605 -
Net cash used in investing activities (1,775) (3,066)
Cash flows from financing activities
Interest and similar expenses paid (163) (523)
Issue of share capital - 3,896
Payment of principal on lease liabilities (242) -
Loans received 1,958 1,201
Related parties loans received 1,210 -
Repayment of loans (2,824) (2,150)
Net cash (used in)/from financing activities (61) 2,424
Net decrease in cash and cash equivalents (36) (1,878)
Cash and cash equivalents at the beginning
of the period 117 1,937
Exchange losses on cash and cash equivalents 104 58
Cash and cash equivalents at the end
of the year 185 117
Selected notes to financial statements year ended 31 March
2020
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 2019 or 2020 but is derived
from them. The financial statements for the year ended 31 March
2019 have been audited and filed with the Registrar of Companies.
The financial statements for the year ended 31 March 2020 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 2019 and 2020 were unqualified and did not contain
statements under Section 498(2) or (3) of the Companies Act
2006.
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 2019 and are unchanged from those set out in the
financial statements for the period ended 31 March 2019, except for
the implementation of the IFRS 16 as described in Note 3.
2. Change in consolidation scope
Main changes for the year ended as at 31 March 2020:
On 5 July 2019, the Group announced the sale of the wholly owned
subsidiary Mirada Connect Ltd. to PayByPhone UK Limited (subsidiary
of Volkswagen Financial Services, AG), for a consideration of $2.61
million (GBP2.12 million). As a result, the Group recognised a gain
of $1.70 million as shown in the Consolidated Income Statement. As
a consequence of said disposal, the results of Mirada Connect Ltd
are included as part of the consolidation scope from 1 April 2019
to the effective date of disposal. For the purpose of IFRS 5, this
is not a discontinued operation.
3. Changes in accounting policies
a. Adoption of new and revised standards effective from 1 April 2019
IFRS 16 - Leases
This Standard replaces the following standards: (a) IAS 17
Leases; (b) IFRIC 4 Determining Whether an Arrangement Contains a
Lease; (c) SIC-15 Operating Leases - Incentives; and SIC-27
Evaluating the Substance of Transactions in the Legal Form of a
Lease.
IFRS 16 establishes that companies that are lessee in lease
contracts will recognise in the consolidated balance sheet the
liabilities and assets of lease contracts (except short-term and
low-value lease agreements). Furthermore, the operating lease
expense has been replaced by a charge for straight-line
amortisation of right of use assets and an interest expense on
lease liabilities.
This standard has not introduced significant changes in the
accounting for lease contracts by the lessor.
The Group previously classified leases as operating or finance
leases under IAS 17 (refer to Note 26). With respect to the leases
classified as finance leases in accordance with IAS 17, the book
value of the right of use asset and the lease liability on the date
of first-time application will be the carrying amount of the lease
asset and the lease liability immediately prior to that date,
measured in accordance with IAS 17. With respect to operating
leases, the lessee will record the asset by right of use and the
lease liability in accordance with this standard as of the date of
first-time application.
The Group has opted to apply the modified retrospective
approach, without restating the comparative information presented
as at 31 March 2019 under the aforementioned standards. On
transition to IFRS 16, the Group elected to apply the practical
expedient to grandfather the assessment of which transactions are
leases. It applied IFRS 16 only to contracts that were previously
identified as leases. Under this option, the Group has calculated
the lease liability as the current value of the outstanding
instalments on the contracts in force at the date of first-time
application determined on the basis of the incremental interest
rates on the aforementioned date and has recognised the value of
the right-of-use asset for the same amount of the lease liability
calculated at 1 April 2019.
The average incremental borrowing rates for the main countries
affected by this standard, used for calculating the current value
of the rights of use and of the operating lease liabilities
recognised at the date of first-time application of IFRS 16 are
detailed in Note 15.
The right of use and lease liability were defined according to
the original contract term.
IFRS 16 establishes two exceptions for the lease recognition
that included the low-value lease agreements (amount equal or less
than to $5 thousand) and short-term lease agreement (for a period
equal or less of 12 months). For these cases, the expenditures are
recognised as expense during the term of the lease agreement. The
Group has taken advantage of these two practical expedients in
determining ROU assets and Lease liability
To calculate this impact, the Group has analysed, among other
factors, the duration of the significant leases considering whether
the agreements can be terminated early or not and whether or not
the durations can be unilaterally extended by the lessee and, in
both cases, the degree of certainty, which, in turn, depends on the
expected use of the assets located in the underlying properties
leased.
The following table shows the impact on the consolidated
statement of financial position at 1 April 2019 of application of
the standard:
IFRS 16
at 1 April 2019
$000
Lease liabilities 492
Right-of-use assets 492
The following table reflects a reconciliation between the
operating lease commitments presented at 31 March 2019 and the
lease liabilities recognised at 1 April 2019:
1 April 2019
$000
Operating lease commitments at 31.03.2019
as reported in the Statements of Financial
Position (Note 26) 960
Impact due to the discount of the future
payments using the incremental borrowing
rate at 1 April 2020 (19)
Recognition exemption for short-term
at transition (246)
Recognition exemption for low value
at transition (203)
Lease liabilities recognised at 1 April
2019 492
Current Lease liabilities recognised
at 1 April 2019 207
Non-current Lease liabilities recognised
at 1 April 2019 285
There was no material impact on the Consolidated Statement of
Cashflows.
Other new amended standards and Interpretations issued by the
IASB that apply to the financial statements do not impact the Group
as they are either not relevant to the Group's activities or
require accounting which is consistent with the Group's current
accounting policies. These standards are:
IFRIC 23 - Uncertainty over Income Tax Treatments
Amendments to IFRS 9 - Prepayment Features with Negative
Compensation
Amendments to IAS 19 - Employee Benefits
Annual Improvements to IFRS Standards 2015-2017 Cycle
b. Adoption of new and revised standards effective from 1 April 2020
New Standards, interpretations and amendments not yet
effective
There are a number of standards and amendments to standards, and
interpretations which have been issued by the IASB that are
effective in future accounting periods that the group has decided
not to adopt early. The most significant of these are as follows,
effective for the period beginning 1 April 2020. The Group is
currently assessing the impact of these new standard and
amendments. The Group does not expect any other standards issued by
the IASB, but not yet effective, to have a material outcome on the
group.
Amendments to IAS 1 and IAS 8
Definition of materiality or with relative importance. This
amendment clarifies the definition of materiality or relative
importance and how it should be applied by introduction in the
definition of guides that until now have been addressed in other
parts of the IFRS Standards; improving the explanations that
accompany the definition and ensuring that the definition of
materiality or with relative importance is consistent throughout
all IFRS Standards. The Group will consider the new definition of
materiality and do not foresee significant impact in the
preparation of the consolidated financial statement.
Amendments to IFRS 3 - Business combinations
At the date of authorisation for issue of these consolidated
financial statements, the amendments to IFRS 3 - Business
combinations have been approved by the International Accounting
Standards Board (IASB).
Amendments to IFRS 3 - Business combinations. IFRS 3 is amended
to limit and clarify the definition of a business, and to enable a
simplified evaluation of whether a set of activities and assets
acquired is a group of assets instead of a business.
4. Significant accounting policies
a. 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.
b. 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, its
exposure to credit and liquidity risks and the impact of the
COVID-19 pandemic.
As at 31 March 2020, the Group had cash and cash equivalents of
$0.19m (2019: $0.12m), had net current assets of $0.29m (2019: net
current liabilities of $0.70m) and net assets of $10.55m (2019:
$9.98m.). In the year ended 31 March 2020, the Group generated net
cash from operating activities of $1.80m (2019: net cash used in
operating activities $1.24m), realised a profit for the year of
$0.59m (2019: a loss of $3.11m). Subsequent to the year end, the
Directors are pleased to announce that they have secured the
following additional funding for the business:
-- EUR1.6m of new loans obtained between April 2020 and June
2020 from banks with 80% of these loans guaranteed by the Spanish
government under the COVID-19 relief scheme.
-- An extension to the term of its EUR1.30 million credit
facility has been granted by Leasa Spain, S.L.U.The term of the
Facility has been extended by 12 months and now expires on 30
November 2021.
The Directors have prepared detailed cash flow forecasts for the
period to at least 31 December 2021. The Directors regularly review
the detailed forecasts of sales, costs and cash flows. The
assumptions underlying the forecasts are challenged, varied and
tested to establish the likelihood of a range of possible outcomes,
including reasonable cash flow sensitivities. The expected figures
are carefully monitored against actual outcomes each month and
variances are highlighted and discussed at Board level. However,
the uncertain impact of COVID-19 introduces more risks and
uncertainty into this year's review. The Group has seen limited
impact of COVID-19 on the operational capability of the business.
From a technology point of view, the Group is also offering and
developing the most advanced features in the market, providing
services to a growing subscriber base in our core markets. To this
end a base case cash flow forecast has been prepared which takes
into account the following key assumptions:
-- The continued availability of the Group's invoice discounting
facility throughout the foreseeable future.
-- An average revenue growth of 13% in the foreseeable future,
which Directors believe, comprise of revenue that is substantially
already secured under signed contracts.
-- Additional net funding of US$1.4m from lenders
-- An expected receipt of US$0.3m of Research and Development
tax credit in March 2021 from Spanish tax authorities.
The Directors have also considered a number of downside
scenarios, including a scenario where all revenue growth from new
customers is removed, a scenario where no further funding is
obtained in the period and a reverse stress test. The purpose of
the reverse stress test for the Group is to test at what point the
cash facilities would be fully utilised if the assumptions in the
Director's base case forecasts are altered. This reverse stress
test includes both a removal of all revenue growth from new
customers and a reduction of contracted revenue from existing
customers for the forecast period, resulting in an overall
reduction of revenue of c.20%, as well as the removal of any
potential future funding and the receipt of the US$0.3m Research
and Development tax credits anticipated. In the event that the
performance of the Group is not in line with the projections, and
more akin to one of our downside scenarios, including the worst
case scenario, action will be taken by management immediately to
address any potential cash shortfall for the foreseeable future.
The actions that could be taken by the Directors include both a
review and restructuring of employment related costs, including the
deferral of any potential bonuses due to employees. These measures
alone could save at least $1.0m in operating costs and therefore
cash flows. Further, the Directors could also negotiate access to
other sources of finances from our lenders. Given the Director's
current relationship with lenders and their recent success in
negotiations with these financial institutions, whilst there are no
binding agreements currently in place, negotiations are in very
advanced stages for additional funding. Therefore, they Directors
are confident that any additional funding required would be
obtained.
Whilst the cash flow forecasts prepared have been sensitised to
consider a number of downside scenarios, including the reverse
stress test, the Directors are pleased to note that the post year
end performance of the Group has exceeded the original forecast for
April and May 2020. Therefore demonstrating that the Group has not
suffered negatively from the impact of COVID-19 and is in a strong
place to meet the base case forecasts.
Overall, the sensitised cash flow forecasts demonstrate that the
Group will be able to pay its debts as they fall due for the period
to at least 31 December 2021. The Directors are, therefore,
satisfied that the financial statements should be prepared on the
going concern basis.
5. Revenue from contracts with customers
Year to 31 March 2020 Development Transactions Licenses Managed Total
services
$000 $000 $000 $000 $000
Mexico 5,642 - 2,945 1,101 9,688
Europe 627 193 10 109 939
Other Americas 1,046 - 569 - 1,615
Asia 668 - 247 - 915
7,983 193 3,771 1,210 13,157
Revenue recognised
over a period 7,923 - - 1,210 9,133
Revenue recognised
at a point in time 60 193 3,771 - 4,024
7,983 193 3,771 1,210 13,157
Year to 31 March 2019
$000 $000 $000 $000 $000
Mexico 5,065 - 3,964 769 9,798
Europe 381 833 73 159 1,446
Other Americas 913 - 17 - 930
Asia 148 - - - 148
6,507 833 4,054 928 12,322
Revenue recognised
over a period 6,182 - - 928 7,110
Revenue recognised
at a point in time 325 833 4,054 - 5,212
6,507 833 4,054 928 12,322
Licenses revenue are including both contract licenses and SaaS
revenue.
Contract balances
The following table provides information about contract assets
(included as accrued income) and contract liabilities (included as
deferred income) from contracts with customers:
31 March 31 March 2019
2020
$000 $000
Contract assets (accrued
income) 3,478 1,891
Contract liabilities (deferred
income) 1,785 1,019
5,263 2,910
The movement in the contract assets and liabilities during the
year is set out below:
Contract assets
31 March 31 March
2020 2019
$'000 $'000
At 1 April 1,891 989
Transfers in the period from contract
assets to trade receivables (1,891) (989)
Excess of revenue recognised over cash
(or rights to cash) 3,478 1,891
recognised during the period
At 31 March 3,478 1,891
Contract liabilities
31 March 31 March
2020 2019
$'000 $'000
At 1 April 1,019 1,360
Amounts included in contract liabilities
recognised (1,019) (1,360)
as revenue in the period
Cash received in advance of performance
and not recognised 1,785 1,019
as revenue during the period
At 31 March 1,785 1,019
Contract assets ('accrued income') and contract liabilities
('deferred income') are included within 'Trade and other
receivables' and 'deferred income' respectively on the face of the
Statement of Financial Position. They arise from the Group's
revenue contracts, where work has been performed in advance of
invoicing customers, and where revenue is received in advance of
work performed. Cumulatively, payments received from customers at
each balance sheet date do not necessarily equate to the amount of
revenue recognised on the contracts.
6. 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 2020 are as
follows:
March 2020
Digital Mobile Other Group
TV & Broadcast
$000 $000 $000 $000
Revenue 12,963 194 - 13,157
Segmental profit/(loss) 2,392 16 87 2,495
(Adjusted EBITDA, see note
7)
Gain on disposal of Mirada
Connect - 1,699 - 1,699
Finance income - - 65 65
Finance expense - - (177) (177)
Depreciation (358) (2) - (360)
Amortisation (3,499) - - (3,499)
Foreign currency translation
differences - - 52 52
Profit / (Loss) before
taxation (1,465) 1,713 27 275
$ 0.087 million (2019: $0.100 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 2019 are as
follows:
March 2019
Digital Mobile Other Group
TV & Broadcast
$000 $000 $000 $000
Revenue - 11,490 832 - 12,322
Segmental profit/(loss) 1,905 171 (1,262) 814
(Adjusted EBITDA, see note
7)
Finance income - - 141 141
Finance expense - - (523) (523)
Depreciation (70) (10) - (80)
Amortisation (3,578) - - (3,578)
Share-based payment charge - - (70) (70)
Profit / (Loss) before
taxation (1,743) 161 (1,714) (3,296)
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 $9.5 million of $13.16m total revenue.
This is approximately 72% of all revenue (2019: $9.7 million, out
of $12.4m) of the total Group revenues.
Segment assets and liabilities are reconciled to the Group's
assets and liabilities as follows:
Assets Liabilities Assets Liabilities
2020 2020 2019 2019
$000 $000 $000 $000
Digital TV - Broadcast
& Mobile 14,488 9,328 11,360 7,675
Other:
Goodwill 5,098 - 5,924 -
Other financial assets
& liabilities 490 196 653 279
Total other 5,588 196 6,577 279
Total Group assets and
liabilities 20,076 9,524 17,937 7,954
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
2020 2019 2020 2019
$000 $000 $000 $000
Mexico 9,688 9,799 34 23
Europe 939 1,445 20,042 17,914
Other Americas 1,615 930 - -
Asia 915 148 - -
13,157 12,322 20,076 17,937
Revenues by
Products:
Digital Mobile Digital Mobile
TV & Broadcast 2020 TV & Broadcast 2019
2020 2019
$000 $000 $000 $000
Development 7,983 - 6,508 -
Transactions 193 - 832
Licenses 3,771 - 4,054 -
Managed Services 1,210 - 928 -
12,964 193 11,490 832
7. Operating loss
This has been arrived at after charging:
2020 2019
$000 $000
Depreciation of owned assets 360 80
Amortisation of intangible assets 3,499 3,578
Operating lease charges 339 596
Total R&D expenditure capitalised as intangible assets
amounts to $4.35m (2019: $3.12m).
The total lease expense not subject to IFRS 16 for short-term as
well as low-value leases amounts to $0.339 (refer to Note 15).
Analysis of auditors' remuneration is as follows:
2020 2019
$000 $000
Fees payable to the company's auditor
for the audit of the company's annual
accounts 65 119
Audit of the account of subsidiaries 25 36
Reconciliation of operating profit for continuing operations to
adjusted earnings before interest, taxation, depreciation and
amortisation:
2020 2019
$000 $000
Operating loss (1,364) (2,914)
Depreciation 360 80
Amortisation 3,499 3,578
Operating profit before interest,
taxation, depreciation, amortisation,
impairment (EBITDA) 2,495 744
Share-based payment charge - 70
Adjusted EBITDA 2,495 814
8. Earnings per share
Year ended Year ended
31 March 31 March
2020 2019
Total Total
Profit/(loss) for year $588,607 $(3,111,688)
Weighted average number
of shares 890,843,408 520,652,606
Basic loss per share $0.001 $(0.006)
Diluted loss per share $0.001 $(0.006)
After the cancellation of share premium approved by the General
Meeting on 10 September 2019, the Company has 41,483 (2019:
4,697,166) potentially dilutive ordinary shares arising from share
options issued to staff. However, i n 2020 and 2019 the
profit/(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.
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 DBGDRRUBDGGU
(END) Dow Jones Newswires
July 16, 2020 02:05 ET (06:05 GMT)
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