TIDMMIRA
RNS Number : 3488N
Mirada PLC
29 September 2021
The information contained within this announcement is deemed by
the Company to constitute inside information pursuant to Article 7
of EU Regulation 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 as amended.
29 September 2021
Mirada plc
("Mirada", "the Company" or "the Group")
Final results for the year ended 31 March 2021
Progress in a challenging year and primed to take advantage of
the recovery
Mirada (AIM: MIRA), a leading provider of integrated software
solutions for digital TV operators and broadcasters, announces its
audited final results for the year ended 31 March 2021.
Financial Highlights
-- Revenue of $11.13 million (2020: $13.16 million), in line
with market expectations.
-- Adjusted EBITDA of $1.70 million (2020: $2.50 million),
ahead of market expectations.
-- Gross profit of $10.84 million (2020: $12.48 million).
-- Net loss for continuing activities of $2.99 million (2020:
loss of $1.11 million).
-- Net debt at 31 March 2021 of $7.07 million (2020: $5.05
million).
Operational Highlights
-- Deployment of our Android TV Operator Tier offering with
izzi Telecom to help deliver its super-aggregation strategy
- more than 450,000 set-top boxes ("STBs") rolled out
by period end.
-- Mirada Iris technology powered the launch of ATN international-owned
'ViyaTV+' offering in the US Virgin Islands.
-- Mirada Iris technology powered the launch of Zapi, a new
OTT based Pay TV platform developed for Plataforma Multimedia
de Operadores (PMO) in Spain.
-- Integration of Disney+ and Amazon Prime Video into Iris
and deployment for izzi Telecom.
-- Successfully transitioned to remote working without operational
disruption.
-- Successful management of finances through pandemic, with
an efficient debt structure and shareholder support.
-- Transitioned to a new reseller sales strategy with marked
increase in pipeline of new opportunities.
-- Proved ability to showcase Mirada's products and make
implementations and upgrades remotely.
Post-period Highlights
-- Accelerated rate of deployments at izzi Telecom.
-- STBs deployed with Android TV technology reached over
800,000 in August 2021.
-- Significant improvement in trading conditions and strongest
pipeline to date.
-- Extension of the Leasa Spain, S.L.U. (related party) credit
facility to a total of EUR3.0 million, expiring November
2022.
José-Luis Vázquez, CEO of Mirada, commented:
"The past year has been challenging in many ways, but we emerge
from it a stronger business with a powerful product offering that
puts us at the forefront of the latest market trends; impressive
references; a leaner, more efficient sales strategy; and a growing
proportion of recurring revenues. We have ambitious plans to drive
the business forward in the coming months and I look forward to
keeping shareholders updated."
Annual Report and Accounts
The Company's Annual Report and Accounts will shortly be made
available on the Company's website www.mirada.tv and will be posted
to shareholders tomorrow.
Contacts
Mirada plc +44 (0)20 8187 1661
José-Luis Vázquez, Chief Executive Officer investors@mirada.tv
Gonzalo Babío, Finance Director
Allenby Capital Limited (Nominated Adviser & Broker) +44 (0)20 3328 5656
Jeremy Porter/Liz Kirchner (Corporate Finance)
Jos Pinnington (Sales and Corporate Broking)
Alma PR (Financial PR Adviser) +44 (0)20 3405 0205
David Ison mirada@almapr.co.uk
Andy Bryant
Matthew Young
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
over 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, ATN International, Telefonica, Sky, Virgin Media, BBC,
ITV, Skytel and France Telecom Orange. 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
Progress in a challenging year and primed to take advantage of
the recovery
While we, like many in our space, were not immune to the effects
of the COVID-19 pandemic over the past year, I am proud of how our
teams have responded and what we have been able to achieve as a
result.
Post-period, as we progress through the new financial year, we
do so with our strongest outlook to date and a genuine sense of
excitement and optimism as to what can be achieved through strong
references, the return of investment appetite among existing and
prospective customers, increasingly favourable macrotrends, and a
significantly improved product offering and commercial
strategy.
Favourable market trends that support our ambitions
The rise of super-aggregation
In recent years, the TV market has been disrupted by
over-the-top (OTT) operators such as Netflix and Amazon Prime Video
who have transformed the user experience, initially impacting the
business models of traditional Pay TV operators with a wave of
"cord-cutters", costing billions a year in lost subscription cash
flows. However, those Pay TV operators have not only invested in
cloud TV to deliver anywhere, anytime, any device services but have
responded to the increasingly fragmented and complex landscape by
positioning themselves as "super-aggregators" - a model that has
accelerated in the pandemic and as more content owners have
launched direct-to-consumer (D2C) services.
Consumers increasingly value simplicity, so there is a need for
platforms to deliver a fast, straightforward and high-quality user
experience making content from various online video services
available and searchable in one place and presenting the user with
all their subscriptions under one bill. Importantly, to deliver
these complex services, Pay TV operators need to work with
innovative software partners like Mirada that have proven
capability in delivering cloud solutions.
Android TV as the new gold standard operating system
Today, Android TV has emerged as the operating system (OS)
roadmap of choice for most operators. Google TV launched in 2010
and ran on several high-end, early generation Smart TVs and
streaming devices. However, it ultimately proved unpopular, largely
because operators were concerned that Google was attempting to
'own' the subscriber. Google discontinued the software and replaced
it with Android TV in 2014. Android TV is a far more open OS,
enabling developers to build apps, viewers to access the Google
Play Store and download apps such as YouTube and - most importantly
- allowing operators to layer on their own user interfaces and
branding. The relative ease of implementation (globally supported,
large-scale platform with access to wide content) means the Android
TV OS is increasingly being viewed by service providers as the OS
of choice for their TV and video set-top-box software, capable of
quickly delivering the premium content and multiscreen proposition
that can reduce churn and increase premium subscriptions. Mirada's
success and uncommon track-record in large scale Android TV
deployments positions us to be a major beneficiary of this
trend.
Content providers moving into D2C TV services
One of the most exciting, emerging trends in our space is with
content providers (companies like Netflix, HBO and Disney etc.)
that are looking to capitalise on their substantial content
libraries by offering new direct-to-consumer TV services. Our
domain knowledge and software expertise mean we are just as
well-positioned to support these content providers, as they look to
build their apps, as we are in helping traditional operators
roll-out aggregated anywhere, anytime, any device TV services.
Although lead times are lengthy, we are beginning to see
opportunities emerge and are confident we have the technology and
resources to meet the requirements of these players.
Significant customer rollouts and growing references
One of the key achievements in the period was the fourth quarter
deployment of our Android TV Operator Tier offering with izzi
Telecom, in close collaboration with Google, to help the Mexican
telecommunications company deliver its ambitious super-aggregation
strategy. The Android TV Operator Tier, so called because it allows
operators to customise the look, feel and functionality of the
platform, is emerging as the OS of choice for many companies who
value the control it grants them over the user experience.
Since the deployment began in October 2020, izzi's new
set-top-boxes using our technology have been rolled out at a rate
of almost 100,000 per month. As of 31 March 2021, there were more
than 450,000 in circulation with the rate of deployment
accelerating post-period (in total, izzi has 3.1 million
set-top-boxes with Mirada including those running the legacy Linux
system). With most new prospects being Android TV and our flagship
Iris solution now boasting Disney+, Amazon Prime Video, Netflix,
HBO, Fox and Blim TV integrations among others, this is a
potentially game-changing reference and leaves us well-placed to
win further significant business.
In September 2020, we completed our largest European launch of
our Iris solution with 'Zapi', a new OTT-based Pay TV platform
developed by Plataforma Multimedia de Operadores (PMO), a
conglomerate of local Spanish telecommunications services looking
to establish Zapi as one of the leading Pay TV platforms in the
country. Zapi allows subscribers to watch content across devices
including Android TV-powered set-top boxes. Over time, the service
is expected to grow beyond 600,000 subscribers.
Elsewhere, we have continued to make encouraging progress. In
August 2020, our Iris technology powered the launch of ATN
international-owned 'Viya TV+' offering in the US Virgin Islands.
Customer satisfaction in the first months since going live and the
rate of uptake by consumers has been high. Viya is the second
reference in the Caribbean, after OneComm in Bermuda which launched
in 2019.
While the pandemic has impacted the pace of subscriptions for
SkyTel in Mongolia and Digital TV in Bolivia, the slowdown is
expected to be temporary as conditions normalise.
Operational improvements that stand us in good stead
We successfully managed our finances through the pandemic, with
an efficient debt structure and shareholder support, which leaves
us well-positioned and gives us optionality as we look to return to
growth.
At the same time, we continue to grow our recurring software
revenues, which provide us with greater visibility of earnings and
enable us to continue to invest in the business. We expect our SaaS
revenue model to grow in our sales mix as we adapt our commercial
offering and as we target smaller operators where it is an
economically attractive model.
Another major development in the period was the restructuring of
our sales function from a direct country-based model to building a
reseller channel. The early signs are encouraging, with a
significant increase in the size of our pipeline. We believe this
shift in strategy will have a positive, long-term impact on the
scalability of our business model.
The travel restrictions also demonstrated our full capability to
showcase our products and implement and upgrade our customers'
infrastructure and their subscribers' set-top boxes remotely. We
expect this to have a positive, long-term impact on our delivery
model, margins and levels of customer satisfaction, even as travel
restrictions begin to ease.
Financial overview
Revenue decreased to $11.13 million (2020: $13.16 million)
because of the delaying effect of COVID-19 on customer and prospect
investment decisions. Development revenue decreased to $5.61
million (2020: $7.98 million). Licence revenues remained strong at
$3.57 million (2020: $3.77 million).
Gross profit decreased to $10.84 million (2020: $12.48 million)
and operating losses increased to $2.59 million (2020: $1.36
million). Staff costs increased to $7.10 million (2020: $6.79
million), mainly due to the majority of our costs being incurred in
Euros and the depreciation of the US dollar. Other administrative
expenses decreased to $2.05 million (2020: $3.20 million).
Despite the temporary revenue reduction, the reduction in costs
helped support an adjusted EBITDA (as defined in Note 7) of $1.70
million (2020: $2.50 million). A tax credit was recognised in the
period of $0.17 million (2020: $0.31 million) from Mirada Iberia's
research and innovation tax deductions. As a result, the Company
recorded a net loss for continued activities of the year of $2.99
million (2020: loss of $1.11 million). The Board expects that the
maturity of present contracts through increased subscriber-based
licence fees, plus the addition of new customers as a result of the
implementation of our sales strategy, will increase the global
turnover as the mix of licence revenues increases with a limited
corresponding development investment, resulting in better margins
and an improved profit level.
Net Debt increased to $7.07 million (2020: $5.05 million).
Long-term interest-bearing loans and borrowings increased to $5.40
million (2020: $2.40 million) and short-term borrowings and related
party loans and interest decreased to $1.78 million (2020: $2.85
million) - see note 9 for further details. Trade receivables
decreased from $1.99 million to $1.83 million.
Post period end, the EUR1.30 million credit facility 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, was extended to a
total of EUR3.0 million, expiring November 2022.
Other intangible assets have increased by $0.68 million, mainly
due to the development of our custom launcher for Android TV.
The Group generated $3.15 million of cash in operating
activities in the year (2020: $1.80 million), an increase mainly
driven by working capital differences, and spent a further $4.17
million (2020: $4.38 million) in investing activities. The
operating and investing cash flows were funded by the movement in
net debt explained above. This resulted in a decrease in cash and
cash equivalents of $0.07 million.
The Company has adopted the following new accounting standards
with effect from 1 April 2020:
-- Amendments to IAS 1 and IAS 8
-- Amendments to IFRS 3 - business combinations
See Note 3 for further information on the new IFRS
standards.
Our strongest outlook to date as trading conditions
normalise
Mirada's primary target market is a group of around 350-400
telecommunications and broadcast operators globally. Each year, we
typically see around one in ten reach a point in their cycle where
they choose to review their integrated software provider. For most
of the year, however, this fell to almost zero as those operators
chose to postpone their decision-making processes until there was
greater clarity around the future of the pandemic. New business
activity across the industry - particularly in the first half -
effectively ground to a halt.
Similarly, we saw a temporary slowdown in professional services
revenue from our existing customers as their immediate priorities
shifted away from areas like optional functionality upgrades.
Encouragingly, as we moved through the second half of the
financial year, with viewing trends being relatively predictable,
we began to see growing indications of a gradual reversion to
pre-pandemic levels of appetite for investment from both existing
and prospective customers.
With the widespread deferral we saw during the year, we are
expecting to see significant pent-up demand and considerably more
new business opportunities emerge in the coming months alongside a
growing pipeline of opportunities with existing customers as they
look to enhance their user experiences. Lead times in our industry
can be lengthy so it is difficult to forecast exactly when new
deals will materialise, but the outlook is positive - particularly
in Asia - and with our new reseller model now in place we are
confident of a return to the commercial momentum that was building
before the pandemic took hold.
The past year has been challenging in many ways, but we emerge
from it a stronger business with a powerful product offering that
puts us at the forefront of the latest market trends; impressive
references; a leaner, more efficient sales strategy; and a growing
proportion of recurring revenues. We have ambitious plans to drive
the business forward in the coming months and I look forward to
keeping shareholders updated.
José-Luis Vázquez
Chief Executive Officer
29 September 2021
Consolidated Statement of Comprehensive Income for the year
ended 31 March 2021
2021 2020
$000 $000
Revenue 11,134 13,157
Cost of sales (297) (676)
-------------------------------------------------- ----------- ----------
Gross profit 10,837 12,481
Depreciation (378) (360)
Amortisation (3,909) (3,499)
Staff costs (7,095) (6,790)
Other administrative expenses (2,047) (3,196)
-------------------------------------------------- ----------- ----------
Total administrative expenses (13,429) (13,845)
Operating loss (2,592) (1,364)
-------------------------------------------------- ----------- ----------
Gain on disposal of Mirada Connect - 1,699
-------------------------------------------------- ----------- ----------
Non operating profit - 1,699
Finance income 70 65
Finance expense (222) (177)
Foreign currency translation differences (419) 52
-------------------------------------------------- ----------- ----------
Profit/(loss) before taxation (3,163) 275
Taxation 171 313
Profit/(loss) for year (2,992) 588
-------------------------------------------------- ----------- ----------
Other comprehensive income for the
period
Forex on translation of foreign
operations 338 2,888
Total comprehensive profit/(loss)
for the period (2,654) 3,476
-------------------------------------------------- ----------- ----------
Earning/(loss) per share Year ended Restated
31 March 31 March
2021 2020
$ $
Earning/(loss) per share for the
year
- basic & diluted (0.336) 0.066
Consolidated Statement of Financial Position as at 31 March
2021
2021 2020
$000 $000
Goodwill 5,435 5,098
Other Intangible assets 7,314 6,631
Right of use assets 343 482
Property, plant and equipment 223 228
Other Receivables 354 486
--------------------------------------- --------- ---------
Non-current assets 13,669 12,925
--------------------------------------- --------- ---------
Trade & other receivables 4,856 6,966
Cash and cash equivalents 107 185
---------------------------------------
Current assets 4,963 7,151
Total assets 18,632 20,076
--------------------------------------- --------- ---------
Loans and borrowings (1,774) (2,820)
Related parties loans and interests (3) (7)
Trade and other payables (2,234) (2,019)
Deferred income (973) (1,785)
Lease liabilities (204) (229)
Current liabilities (5,188) (6,860)
--------------------------------------- --------- ---------
Net current (liabilities)/assets (225) 291
--------------------------------------- --------- ---------
Total assets less current liabilities 13,444 13,216
--------------------------------------- --------- ---------
Related parties loans (586) (1,210)
Interest bearing loans and borrowings (4,815) (1,195)
Lease liabilities (145) (259)
Non-current liabilities (5,546) (2,664)
--------------------------------------- --------- ---------
Total liabilities (10,734) (9,524)
--------------------------------------- --------- ---------
Net assets 7,898 10,552
--------------------------------------- --------- ---------
Issued share capital and reserves
attributable to equity holders of
the company
Share capital 12,015 12,015
Share premium - -
Merger reserve 4,863 4,863
Foreign exchange reserves 13,761 13,423
Accumulated loss (22,741) (19,749)
Equity 7,898 10,552
--------------------------------------- --------- ---------
Consolidated Statement of changes in equity for the year ended
31 March 2021
Share Share Foreign Merger Accumulated Total
capital premium exchange reserves losses
reserve
$000 $000 $000 $000 $000 $000
Balance at 1 April 2020 12,015 - 13,423 4,863 (19,749) 10,552
------------------------------ --------- --------- ---------- ---------- ------------ --------
Profit/(loss) for year - - - - (2,992) (2,992)
Other comprehensive income
Movement in foreign exchange - - 338 - - 338
Total comprehensive income
for the year - - 338 - (2,992) (2,654)
------------------------------ --------- --------- ---------- ---------- ------------ --------
Balance at 31 March 2021 12,015 - 13,761 4,863 (22,741) 7,898
------------------------------ --------- --------- ---------- ---------- ------------ --------
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/(loss) for 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
------------------------------ --------- --------- ---------- ---------- ------------ --------
Consolidated Statement of Cash Flows for the year ended 31 March
2021
2021 2020
$000 $000
Cash flows from operating activities
(Loss)/profit after tax (2,992) 588
Adjustments for:
Depreciation of property, plant
and equipment 378 360
Amortisation of intangible assets 3,909 3,499
Finance income (70) (65)
Finance expense 222 177
Foreign currency translation differences 419 (52)
Taxation (171) (313)
Gain on disposal of Mirada Connect - (1,699)
Operating cash flows before movements
in working capital 1,695 2,495
Decrease/(increase) in trade and
other receivables 1,375 (2,011)
(Decrease)/increase in trade and
other payables (74) 1,065
Interest paid (13) (14)
Taxation received 162 265
------------------------------------------- -------- --------
Net cash used in operating activities 3,145 1,800
Cash flows from investing activities
Interest and similar income received 70 65
Purchases of property, plant and
equipment (53) (126)
Purchases of other intangible assets (4,185) (4,319)
Cash proceeds from sale of Mirada
Connect - 2,605
------------------------------------------- -------- --------
Net cash used in investing activities (4,168) (1,775)
Cash flows from financing activities
Net payment to settle derivative - -
Interest and similar expenses paid (209) (163)
Payment of principal on lease liabilities (301) (242)
Loans received 3,264 1,958
Related parties loans received - 1,210
Repayment of loans (956) (2,824)
Repayment of related parties (704) -
------------------------------------------- -------- --------
Net cash from/(used in) financing
activities 1,094 (61)
Net decrease in cash and cash equivalents 71 (36)
Cash and cash equivalents at the
beginning of the period 185 117
Exchange losses on cash and cash
equivalents (149) 104
Cash and cash equivalents at the
end of the year 107 185
------------------------------------------- -------- --------
Selected notes to financial statements year ended 31 March
2021
1. General information
Mirada plc is a company incorporated in the United Kingdom. The
address of the registered office is 3rd Floor Chancery House, St
Nicholas Way Sutton, Surrey SM1 1JB. 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.
2. Change in consolidation scope
Main changes for the year ended as at 31 March 2021:
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, last year the Group
recognised a gain of $1.70 million as shown in the Consolidated
Income Statement for the year ended 31 March 2020. 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
was not a discontinued operation.
3. Changes in accounting policies
a. Adoption of new and revised standards effective from 1 April 2020
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.
COVID-19-Related Rent Concessions (Amendments to IFRS 16)
Effective 1 June 2020, IFRS 16 was amended to provide a
practical expedient for lessees accounting for rent concessions
that arise as a direct consequence of the COVID-19 pandemic and
satisfy the following criteria:
(a) The change in lease payments results in revised
consideration for the lease that is substantially the same as, or
less than, the consideration for the lease immediately preceding
the change;
(b) The reduction is lease payments affects only payments
originally due on or before 30 June 2021; and
(c) There are no substantive change to other terms and conditions of the lease.
Rent concessions that satisfy these criteria may be accounted
for in accordance with the practical expedient, which means the
lessee does not assess whether the rent concession meets the
definition of a lease modification. Lessees apply other
requirements in IFRS 16 in accounting for the concession.
Adoption of the above standards did not have a material impact
on the consolidated financial statements
b. New Standards, interpretations and amendments not yet effective
There are a number of standards, 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 following amendments are effective for the period beginning
1 January 2022:
o Onerous Contracts - Cost of Fulfilling a Contract (Amendments
to IAS 37);
o Property, Plant and Equipment: Proceeds before Intended Use
(Amendments to IAS 16);
o Annual Improvements to IFRS Standards 2018-2020 (Amendments to
IFRS 1, IFRS 9, IFRS 16 and IAS 41); and
o References to Conceptual Framework (Amendments to IFRS 3).
In January 2020, the IASB issued amendments to IAS 1, which
clarify the criteria used to determine whether liabilities are
classified as current or non-current. These amendments clarify that
current or non-current classification is based on whether an entity
has a right at the end of the reporting period to defer settlement
of the liability for at least twelve months after the reporting
period. The amendments also clarify that 'settlement' includes the
transfer of cash, goods, services, or equity instruments unless the
obligation to transfer equity instruments arises from a conversion
feature classified as an equity instrument separately from the
liability component of a compound financial instrument. The
amendments were originally effective for annual reporting periods
beginning on or after 1 January 2022. However, in May 2020, the
effective date was deferred to annual reporting periods beginning
on or after 1 January 2023.
Mirada Group is currently assessing the impact of these new
accounting standards and amendments. The Group does not believe
that the amendments to IAS 1 will have a significant impact on the
classification of its liabilities, as the conversion feature in its
convertible debt instruments is classified as an equity instrument
and therefore, does not affect the classification of its
convertible debt as a non-current liability.
Interest Rate Benchmark Reform - IBOR 'phase 2' (Amendments to
IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16)
These amendments to various IFRS standards are mandatorily
effective for reporting periods beginning on or after 1 January
2021. The amendments provide relief to Group in respect of certain
loans whose contractual terms are affected by interest benchmark
reform.
The Group has not early adopted any of the above standards and
the directors are assessing the impact on future financial
statements. There are no other IFRS or IFRIC interpretations that
are not yet effective that would be expected to have a material
impact on the Group.
4. Significant accounting policies
a. Basis of accounting
The consolidated financial statements have been prepared in
accordance with international accounting standards in conformity
with the Companies Act 2006 and international financial reporting
standards adopted pursuant to Regulation (EC) No.1606/2002 as it
applies in the European Union.
The consolidated financial statements have been prepared under
the historical cost convention, as modified by the revaluation of
financial assets and financial liabilities (including derivative
instruments) at fair value through profit or loss, assets held for
sale measured at fair value less costs to sell; and defined benefit
pension plans for which the plan assets are measured at fair
value.
All amounts disclosed in the consolidated financial statements
and notes have been rounded off to the nearest thousand currency
units, unless otherwise stated.
The preparation of consolidated financial statements requires
the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the
group's accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and estimates
are significant to the consolidated financial statements, are
disclosed in Note 5.
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 2021, the Group had cash and cash equivalents of
$0.11m (2020: $0.19m), had net current liabilities of $0.23m (2020:
net current assets of $0.29m) and net assets of $7.90m (2020:
$10.55m.). In the year ended 31 March 2021, the Group generated net
cash from operating activities of $3.15m (2020: $1.80m), realised a
loss for the year of $2.99m (2020: a profit of $0.59m). During the
year, the Group had secured the following funding for the
business:
o 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.
o 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 2022.
The Directors have prepared detailed cash flow forecasts for the
period to at least 30 September 2022 and extended it for further 4
years. 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 has increased 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 2021. 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 2021 Professional Services Transactions Licenses Support & Maintenance Total
$000 $000 $000 $000 $000
Mexico 4,239 - 2,032 1,713 7,984
Europe 827 - 556 228 1,611
Other Americas 393 - 977 - 1,370
Asia 147 - - 22 169
---------------------- ------------- --------- ---------------------- -------
5,606 - 3,565 1,963 11,134
Revenue recognised over
a period 5,243 - 3,450 1,916 10,609
Revenue recognised at a
point in time 363 - 115 47 525
5,606 - 3,565 1,963 11,134
Year to 31 March 2020 Professional Services Transactions Licenses Support & Maintenance Total
$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
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
2021 2020
$000 $000
Contract assets (accrued
income) 1,561 3,478
Contract liabilities
(deferred income) 973 1,785
2,534 5,263
========= =========
The movement in the contract assets and liabilities during the
year is set out below:
31 March 31 March
2021 2020
$'000 $'000
At 1 April 3,478 1,891
Transfers in the period from contract
assets to trade receivables (3,478) (1,891)
Excess of revenue recognised over
cash (or rights to cash) 1,561 3,478
recognised during the period
At 31 March 1,561 3,478
============= =========
Contract
liabilities
31 March 31 March
2021 2020
$'000 $'000
At 1 April 1,785 1,019
Amounts included in contract liabilities
recognised (1,785) (1,019)
as revenue in the period
Cash received in advance of performance
and not recognised 973 1,785
as revenue during the period
At 31 March 973 1,785
============= =========
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 Digital TV & Broadcast. 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 2021 are as
follows:
March 2021
Digital Mobile Other Group
TV & Broadcast
$000 $000 $000 $000
Revenue 11,134 - - 11,134
Segmental profit/(loss) 2,439 - (744) 1,695
(Adjusted EBITDA, see
note 8)
Finance income - - 70 70
Finance expense - - (222) (222)
Depreciation (378) - - (378)
Amortisation (3,909) - - (3,909)
Foreign currency translation
differences (419) - - (419)
---------------- ------- ------ --------
Profit / (Loss) before
taxation (2,267) - (896) (3,163)
$ 0.744 million (2020: $0.087 million) disclosed as "Other"
comprises employment, legal, accounting and other central
administrative costs incurred at a Mirada Plc level.
On July 2019 Mirada Connect Ltd, which represented the mobile
segment, was sold to PaybyPhone Ltd, a subsidiary of the Volkswagen
Group.
The 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 8)
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
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 $7.9 million of $11.03m total revenue.
This is approximately 72% of all revenue (2020: $9.5 million, out
of $13.16m) of the total Group revenues.
Segment assets and liabilities are reconciled to the Group's
assets and liabilities as follows:
Assets Liabilities Assets Liabilities
2021 2021 2020 2020
$000 $000 $000 $000
Digital TV - Broadcast
& Mobile 12,847 10,449 14,488 9,328
Other:
Goodwill 5,435 - 5,098 -
Other financial assets
& liabilities 350 286 490 196
Total other 5,785 286 5,588 196
Total Group assets and
liabilities 18,632 10,734 20,076 9,524
Assets allocated to a segment consist primarily of operating
assets such as property, plant and equipment, intangible assets,
goodwill and receivables.
On July 2019 Mirada Connect Ltd, which represented the mobile
segment, was sold to PaybyPhone Ltd, a subsidiary of the Volkswagen
Group.
Liabilities allocated to a segment comprise primarily trade
payables and other operating liabilities.
Geographical
disclosures
External revenue Total assets
by location of by location
customer of assets
2021 2020 2021 2020
$000 $000
Mexico 7,984 9,688 14 34
Europe 1,611 939 18,618 20,042
Other Americas 1,370 1,615 - -
Asia 169 915 - -
---------------- ----------- -------
11,134 13,157 18,632 20,076
Revenues by
Products:
Digital Mobile Digital Mobile
TV & Broadcast 2021 TV & 2020
2021 Broadcast
2020
$000 $000
Professional
Services 5,606 - 7,983 -
Transactions - - 193
Licenses 3,565 - 3,771 -
Support & Maintenance 1,963 - 1,210 -
11,134 - 12,964 193
7. Expenses by nature
This has been arrived at after charging:
2021 2020
$000 $000
Depreciation of owned assets (notes
15 and 16) 378 360
Amortisation of intangible assets
(note 14) 3,909 3,499
Operating lease charges 253 339
Research and development costs 0 -
Operating Foreign Exchange (gains)/losses
Total R&D expenditure capitalised as intangible assets
amounts to $4.12m (2020: $4.35m).
The total lease expense not subject to IFRS 16 for short-term as
well as low-value leases amounts to $0.253 (2020: $0.339).
Analysis of auditors' remuneration is as follows:
2021 2020
$000 $000
Fees payable to the company's auditor
for the audit of the company's
annual accounts 60 65
Audit of the account of subsidiaries 30 25
Reconciliation of operating profit for continuing operations to
adjusted earnings before interest, taxation, depreciation and
amortisation:
2021 2020
$000 $000
Operating loss (2,592) (1,364)
Depreciation 378 360
Amortisation 3,909 3,499
Operating profit before interest,
taxation, depreciation, amortisation,
impairment (EBITDA) 1,695 2,495
Share-based payment charge - -
Adjusted EBITDA 1,695 2,495
======== ========
8. Earnings per share
Year ended Restated
31 March 31 March
2021 2020
Total Total
(Earnings)/profit for
year $(2,992,569) $588,607
Weighted average number
of shares 8,908,435 8,908,435
Basic earnings per share $(0.336) $0.066
Diluted earnings per
share $(0.336) $0.066
After the cancellation of share premium approved by the General
Meeting on 10 September 2019, the Company has 41,483 (2020: 41,483)
potentially dilutive ordinary shares arising from share options
issued to staff. However, i n 2021 and 2020 the (loss)/profit
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 earning per ordinary
share and is therefore anti-dilutive.
9. Non-current liabilities
2021 2020
$000 $000
Interest bearing loans and borrowings:
Bank loans 3,767 228
Other loans 1,048 967
Related parties loans 586 1,210
------ ------
5,401 2,405
Other loans relate to loans received by the Group's Spanish
operation to assist in funding the continued development of the
Group's Digital TV products.
Net Debt
Net Debt is calculated based on short term loans, long terms
loans and cash and cash equivalents:
2021 2020
$000 $000
Loans and borrowings - Current 1,777 2,827
Loans and borrowings - Non Current 5,401 2,405
Cash (107) (185)
Net Debt 7,071 5,047
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END
FR SEFSIUEFSEDU
(END) Dow Jones Newswires
September 29, 2021 02:00 ET (06:00 GMT)
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