viewLocation Sciences Group PLC

Location Sciences Group - defining the opportunity

Location Sciences Group PLC (LON:LSAI) - defining the opportunity
Recent developments

Location Sciences, the world leader in location verification for mobile advertising, recently released results for the first half ( H1) of 2019 and announced a share placing raising £0.6mlm (gross) of additional capital. Revenues for the H1 period were up 94% at £0.45mln, and period-end net cash was £1.5mln. The core product Verify achieved new client wins that confirm the market opportunity for this offering. The company will now undertake some realignment of its marketing strategy to best realise the potential for Verify. We make some changes to our forecasts to reflect these changes.

US expansion – the lessons learned:

Verify was rolled out in North America, the key target market, during H1 2019. This experience has allowed the company to better define the target market for this product.

The company will now focus on tier 2 and tier 3 advertising agencies rather than the big four. These mid-sized agencies have a greater incentive to differentiate themselves by adding Verify to their suite of capabilities.

New personnel have been added to deliver on this strategy, including Donnie Williams of Horizon Media to a non-exec role, and Andy Roberts, formerly head of trading of MindShare, who is to join the advisory panel.

New ad agency partnerships achieved during the period include SITO Mobile in the US and Vicinity Media in South Africa.

We are changing our financial forecasts to reflect a lengthier timeframe for Verify to achieve scale in the US and a revised cost base. We are lowering our 2019e revenue forecast to £1.1mln.

Our year-end net cash forecasts are presented based on no further capital being raised. We believe that Location Sciences will, in fact, seek additional capital to fund the development of the business through to 2021 and positive profitability.

Market potential and valuation

Location Sciences offers a unique verification solution into a mobile advertising market of more than US$145bn. On p2 we present some overview of the addressable market. We see a revenue opportunity for Location Sciences of up to US$500mln, which offers significant upside to the current share price in our view.

Year end Dec 31 2018 Current 2020 2021
Revenue £M 0.8 1.1 2.8 5.6
Gross profit 0.4 0.7 2.0 4.3
EBITDA (£M) (1.2) (2.1) (1.1) 0.8
Net cash/ (debt) £M 2.6 0.5 (1.4) (1.8)

Quick facts: Location Sciences Group PLC

Price: 0.503 GBX

Market: LSE
Market Cap: £2.87 m


The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Location Sciences Group PLC named herein, including the promotion by the Company of Location Sciences Group PLC in any Content on the Site, the...



Proactive Research is a trading name of Proactive Investors Limited which is regulated and authorised by the Financial Conduct Authority (FCA) under firm registration...


Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

Location Sciences reports increase in first half revenues and says funded...

Proactive Research analyst Ed Stacey discusses a first half update from Location Sciences (LON:LSAI). He says the firm had cash reserves of £1.7mln at the end of June 2020 which the company believes provides sufficient funding through to Q2 2021. Stacey adds that the loss at the EBITDA level...

on 27/7/20

4 min read