Mobile Streams plc
("Mobile Streams" or the "Company")
Year End Trading update
Mobile Streams PLC (AIM: MOS), the mobile media company, is pleased to announce that trading for the 12 months to 30 June 2018 was in line with management's expectations.
· Revenues of approximately £3.0 million (2017: £5.7 million);
· EBITDA* loss reduced compared to prior year, as anticipated;
· Net cash of £1 million (June 2017: £2.3 million); and
· Revenues in India increased by approximately 25% to £0.5 million, with active subscribers** of more than 250,000 (2017: 200,000).
* EBITDA is defined as earnings before interest, tax, depreciation, amortization and share-based compensation.
** Active subscribers are measured as consumers who have made a purchase from the Company in the country in the past 60 days. For like-for-like comparability, this is the same methodology the Company uses to measure subscribers in its other markets such as Argentina.
Commenting Simon Buckingham, CEO, said: "The Indian market continues to undergo significant growth, consolidation, innovation and evolution which, amongst other things, is driving greater smartphone, data and games usage amongst consumers. Following significant cost reductions implemented across the business, and continuing reduced losses, the Company believes that it is well placed for the year ahead".
Business overview - India
Active subscribers* in India increased to more than 250,000 at the end of the financial year and Mobile Streams is now live with direct billing connections to the four largest local Indian carriers that offer such third-party billing connections. Total potential billable audience is now estimated to be around nine hundred million subscribers across these carriers. Three of these billing connections accounted for the vast majority of Indian revenues in the financial year ended 30 June 2018.
Smartphone penetration is still in the minority in India (reaching an estimated 39% in 2019) meaning that hundreds of millions of people are still to update to smartphones and 4G feature phones. (see https://www.statista.com/topics/4600/smartphone-market-in-india/).
For the current financial year, as well as growing its existing business, the Company expects to focus on the following new revenue streams in India:
· Scaling up the fourth billing connection; and
· As part of the Company's change in customer acquisition strategy from paid for marketing to performance based pre-installed applications it will look to add new handset embedding partners with local carriers and local phone manufacturers.
Business overview - Argentina
In Argentina, trading was in line with our expectations, despite a significant devaluation of the Argentine Peso of 43% year over year of which 24% occurred in the last 2 months of the financial year which reduced reported sterling revenues. Argentine revenues are expected to fall slightly in the next financial year as a result of this devaluation. Our largest billing partner in the local market accounted for approximately £2.3 million in revenues (2017: £2.6 million) during the year ended 30 June 2018.
The first three months of the recently ended financial year showed a rise on monthly acquisitions for the organic subscription business, with a peak in August 2017 of a total of 90,000 acquisitions. Acquisition volumes continued at approximately 50% of 2017 volumes until March 2018. As a result of dollar instability from March 2018, Mobile Streams took the decision to restrict business from some international and domestic advertising network customers, which reduced the number of subscribers in the last quarter of the financial year.
Premium services have been upgraded, including installable app availability for compatible phones. Additionally, ad-funded services have been deployed for non-converting gaming traffic leads, where third party and our own IP games can be played.
In June 2018, Mobile Streams was selected by Movistar for making Google and Facebook tests for three months, and if the results are in line with expectations, we could continue using these channels in the future.
+1 347 669 9068
Simon Buckingham, Chief Executive Officer
Enrique Benasso, Chief Financial Officer
N+1 Singer (Nominated Adviser and Broker)
+44 (0)20 7496 3000
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