Interim Results
24 11월 2006 - 4:01PM
UK Regulatory
RNS Number:6406M
Blue Star Mobile Group plc
24 November 2006
BLUE STAR MOBILE GROUP PLC
Interim Results
Blue Star Mobile Group PLC ("Blue Star"), the provider of mobile marketing and
content solutions, announces its interim results for the period ended 30
September 2006.
Financial Highlights
- Turnover up 87% to #2.2m (2005: #1.2m)
- Gross profit up 101% to #0.8m (2005: #0.4m)
- Gross profit margin strengthens to 37% (2005: 35%)
- EBITDA of #28,000 against loss of #105,000 in 2005
- Profit before tax of #7,000 against loss of #117,000
- Net cash balances of #0.4m at 30 September 2006
Operational Highlights
- International Business - International sales now 17% of total sales
following significant expenditure to develop international opportunities.
- World Cup 2006 - Significant World Cup activity including the
activation in the UK of T-Mobile's official mobile sponsorship.
- David Beckham - The negotiation on behalf of Motorola Inc for David
Beckham to become its Global Brand Ambassador. Extended agreement for Blue Star
to manage the partnership globally for the contract duration.
- 20th Century Fox - Production and delivery of mobile marketing
campaigns to promote their launch of major film releases including: X-Men 3,
Eragon and The Devil Wears Prada.
- China - The successful launch of "Mobile WOW" in China, an internal
communication tool created by Blue Star for Motorola Sales Agents nationwide.
- US Operation - The incorporation of Blue Star Mobile Inc and the
opening, in October 2006, of its Chicago HQ in order to support existing
business and develop new opportunities in North America.
For further Information, please contact
Steve Clarke Paul McManus
Chief Executive Parkgreen Communications Ltd
Tel: 020 7317 2300 Tel: 020 7493 3716
Mob: 07980 541 893
Adam Hayes
Finance Director
Tel: 020 7317 2300
About Blue Star Mobile Group PLC
The Group consists of three companies:-
Blue Star Mobile Ltd is a leading market provider in developing and delivering
mobile marketing solutions for large blue chip organisations. The company
creates compelling propositions and delivers a complete end-to-end technical
solution. Clients include: 20th Century Fox, Sky, Motorola, News Group Digital,
Bacardi and British Airways.
Blue Star Sport Ltd specialises in providing sports marketing services to mobile
brands. Its role is to negotiate, manage and activate sponsorship contracts in
both the UK and overseas for its clients. Blue Star Sport's main clients are
T-Mobile UK, acting as their exclusive football and cycling sponsorship agency
and Motorola Inc, managing their David Beckham global partnership.
Blue Star Mobile Inc is the North American subsidiary set up to develop mobile
marketing and promotional activity in the US market. Its initial customers are
Motorola and 20th Century Fox.
Blue Star Mobile Group PLC
Chairman's Statement
The Mobile Market
Our underlying view of the mobile market has not changed, in that it is still
very confusing to both consumers and corporates. Our aim is to simplify it by
delivering a complete end-to-end technical solution whilst retaining the freedom
to develop exciting products and services.
Business Review
We have continued to develop innovative and creative promotions and services for
our customers. Clients originate from the areas of handset manufacturers,
network operators, retailers, media companies and major brands and include
Motorola, News International, 20th Century Fox, T-Mobile, British Airways and
Bacardi.
We operate in three business channels that are scaleable globally, all of which
have seen growth.
Turnover Analysis
2006/7 2005/6 Growth 2005/6
H1 H1 Total
Sports Marketing 750 485 55% 1,172
Brand & Product Marketing 779 126 518% 473
Channel Marketing 645 554 16% 1,419
Total 2,174 1,165 87% 3,064
Sports Marketing
Sports Marketing successfully managed and activated T-Mobile's sponsorship of
The FIFA World Cup in the UK and is continuing to develop new sponsorship
activities for them going into 2007.
It also played a key role in negotiating Motorola's three-year agreement with
David Beckham for him to become their global brand ambassador and has already
arranged for this partnership to be activated in Asia, Australia and Africa.
This contract demonstrates our ability to deliver synergies across the Group.
Brand & Product Marketing
We are particularly pleased with the progress achieved in this area as we have
always believed that this is the key area of development for the business.
Whilst we recognised that our core business would come from handset
manufacturers and retailers, we are encouraged at the rate at which we have
attracted other brands outside the mobile arena. In particular, our activities
with 20th Century Fox have expanded in the UK and US and we are working with
them to develop numerous mobile applications and features for a range of films
including "Eragon" and "The Devil Wears Prada".
The launch of an exclusive David Beckham content promotion on the Motorola RAZR
V3i in all O2 High Street stores demonstrates the ability of the Group to
develop value from the Sports Marketing business and link it into effective
campaigns for customers.
The period also saw the successful launch of "Mobile WOW", an internal
communication tool for Motorola's sales agents in China.
Our core strengths are our ability to create compelling mobile products and
services and then our ability to deliver a complete end-to-end technical
solution.
Channel Marketing
Channel Marketing has seen the effects of price erosion in its ringtone and
download services. Turnover grew as a result of new services that were launched
in the second half of last year. We will continue to seek new opportunities
should they arise but we increasingly see this area as an enabler to assist in
the development of campaigns and services for brands and promotions.
Financial Results
2006/7 2005/6 Growth 2005/6
H1 H1 Total
#000 #000 #000
Sales 2,174 1,165 87% 3,064
Gross Profit 812 403 101% 1,062
Costs (809) (526) 54% (1,137)
EBITDA* 28 (105) - (32)
Profit (loss) before tax 7 (117) - (65)
Profit after tax 5 (117) - 21
* before charge for share option grant
The group has generated a turnover of #2.2m (H1, 2005: #1.2m) in the six months
ending 30 September 2006.
In the same period gross margin doubled to #812,000 (H1, 2005: #403,000) with
operating costs rising by 54%. The cost increase was primarily incurred in staff
and travel costs as the business increased resource to support the expansion of
turnover and international opportunities.
This expansion has been achieved whilst the group has remained profitable.
The business holds #0.39m of net cash at the 30 September 2006.
Six Months Overview
The key objective for the period was to develop our existing relationships and
to expand our offering globally. We have delivered on both of these objectives.
We are pleased with the performance of the business to date and are excited
about what can be achieved going forward.
Outlook
We will continue to develop relationships with our existing partners in the UK
and overseas, expanding further our relationships focussing on media agencies
and brands that see the value in utilising the mobile channel.
We have recently incorporated a subsidiary in the US and established an office
in Chicago in order to support our expanding US business. As part of this
programme David Maclachlan, a major shareholder, and previously a non executive
director, has agreed to move to Chicago to drive the business expansion forward.
David brings his wealth of experience to the role having lived and worked in the
US for many years with Monster Worldwide.
As part of the board changes brought about by David taking on this role I am
pleased to welcome onto the board Michael Slater and Oli Roxburgh. Michael is a
lawyer with considerable commercial experience working with a number of
companies and he will join the board as a non executive director and will also
sit on both the audit and remuneration committees. Oli Roxburgh will also join
the board reflecting his expanding role as Group Commercial Director.
We believe that the business will continue to grow profitably going forward as
we exploit opportunities within the growing mobile marketing and content
solutions market.
We will continue to invest in the business where we see additional opportunities
and would expect this to include further geographic expansion as well as
additional headcount.
Summary
We are pleased with the performance of Blue Star Mobile Group PLC to date and
whilst we understand the challenges ahead, we are very excited and optimistic
about the potential that our business can realise in a rapidly growing market.
We have already established a number of key relationships with a range of blue
chip organisations and are confident about our ability to grow and develop the
business.
David Cromwell
Chairman
24 November 2006
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Period ended 30 September 2006
Unaudited Unaudited Audited
Period Period Period
ended ended ended
30 September 30 September 31 March
2006 2005 2006
#'000 #'000 #'000
TURNOVER 2,174 1,165 3,064
COST OF SALES (1,362) (762) (2,002)
GROSS PROFIT 812 403 1,062
Administrative expenses (809) (526) (1,137)
OPERATING PROFIT/(LOSS) 3 (123) (75)
Interest receivable and similar income 4 6 10
Interest payable and similar charges - - -
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 7 (117) (65)
BEFORE TAXATION
Tax on profit on ordinary activities (2) - 86
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 5 (117) 21
AFTER TAXATION
BASIC AND DILUTED EARNINGS/(LOSS) PER ORDINARY SHARE 0.024 (0.457) 0.077
(pence)
There are no gains and losses other than those passing through the profit and
loss account.
CONSOLIDATED BALANCE SHEET
As at 30 September 2006
Unaudited Unaudited Audited
Period ended Period ended Year ended
30 September 30 September 31 March
Note 2006 2005 2006
#'000 #'000 #'000
FIXED ASSETS
Intangible Assets 415 437 426
Other tangible fixed assets 21 21 25
436 458 451
CURRENT ASSETS
Debtors 1,143 661 805
Cash at bank and in hand 389 399 400
1,532 1060 1,205
CREDITORS: amounts falling due (1,066) (770) (763)
within one year
NET CURRENT ASSETS 466 290 442
TOTAL ASSETS LESS CURRENT LIABILITIES 902 748 893
CREDITORS: amounts falling due - - -
after more than one year
TOTAL NET ASSETS 902 748 893
CAPITAL AND RESERVES
Called up share capital 295 295 295
Share premium account 1,225 1,225 1,225
Reverse Acquisition reserve (211) (211) (211)
Share Option Reserve 13 2 9
Profit and loss account (420) (563) (425)
EQUITY SHAREHOLDERS' FUNDS 5 902 748 893
CONSOLIDATED CASH FLOW STATEMENT
Period ended 30 September 2006
Unaudited Unaudited Audited
Period Six months Year
ended ended ended
30 September 30 September 31 March
Note 2006 2005 2006
#'000 #'000 #'000
Net cash inflow from operating activities 4 (9) (222) (214)
Returns on investment and servicing of finance
Interest received 4 6 10
Net cash inflow from returns on investments and servicing 4 6 10
of finance
Taxation
UK corporation tax paid - - -
Capital expenditure and financial investment
Payments to acquire tangible fixed assets (6) (4) (15)
Net cash outflow from capital expenditure and financial (6) (4) (15)
investment
Acquisitions and disposals
Payments to acquire subsidiary (98) (98)
Cash acquired in subsidiary 26 26
Net cash (outflow)/inflow from acquisitions and disposals - (72) (72)
Cash outflow before financing (11) (292) (291)
Financing
Issue of share capital - 246 246
Expenses incurred in issuing share capital - (155) (155)
New borrowings - 256 256
Repayment of borrowings - (97) (97)
Expenses incurred in arranging finance -
Net cash inflow from financing - 250 250
Decrease in cash (11) (42) (41)
NOTES TO THE INTERIM FINANCIAL INFORMATION
Period ended 30 September 2006
1. The financial information included in the interim report comprises the
consolidated profit and loss account, the consolidated balance sheets,
consolidated cash flow statement and notes 1 to 6. These have been prepared in
accordance with the normal accounting policies of the Group subject to the
following:
Change in accounting policy
The group has adopted FRS 20 Share-based payments. The adoption represents a
change in accounting policy and the comparative figures have been restated
accordingly.
Employees of the group receive part of their remuneration in the form of
share-based payment transactions, whereby the employee provides services in
exchange for shares or rights over shares (equity-settled transactions).
The fair value of employee share options is calculated at the date of grant
using the Black- Scholes model. In accordance with FRS 20 the resulting cost is
charged to the Profit and Loss account over the vesting period. The value of the
charge is adjusted to reflect the expected and actual levels of vesting.
This resulted in an additional charge of #9,000 in year ended 2006
2. This interim financial information does not constitute statutory
accounts within the meaning of s240 (5) of the Companies Act 1985.
3. The financial information is unaudited and has not been reviewed by the
Group's auditors.
4. Reconciliation of operating profit/(loss) to net cash outflow from
operating activities
Unaudited Unaudited Audited
Period Period Year
ended ended ended
30 September 30 September 31 March
2006 2005 2006
#'000 #'000 #'000
Operating Profit/(loss) 3 (123) (75)
Depreciation 10 5 12
Share Option provision 4 2 9
Amortisation of Goodwill 11 11 22
Increase in debtors (340) (473) (531)
Increase in creditors 303 356 349
Net cash outflow from operating activities (9) (222) (214)
5. Statement of movements on share capital and reserves
Called up Share Reverse Share Profit
share premium Acquisition Option and loss
capital reserve Reserve account Total
#'000 #'000 #'000 #'000 #'000 #'000
At 31 March 2006 295 1,225 (211) 9 (425) 893
Retained profit for the period - 4 5 9
unaudited
At 30 September 2006 - unaudited 295 1,225 (211) 13 (420) 902
6. Copies of this statement are available to the public for collection at
the company's registered office at 116 Gloucester Place, London W1U 6HZ.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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