TIDMMES
RNS Number : 7264U
Messaging International Plc
30 June 2009
Messaging International Plc / Market: AIM / Epic: MES / Sector: Technology
30 June 2009
Messaging International Plc
('Messaging International' or 'the Company')
Final Results
Messaging International Plc, the AIM traded provider of innovative messaging
services, announces its results for the year ended 31 December 2008.
Overview
* Strengthened position as leading provider of innovative messaging services
especially in 'Text to Landline' and 'PC to Mobile' solutions
* Post-tax loss GBP367,267 (2007: loss GBP259,892)
* Total revenue increased by over 27% to GBP1,742,632 (2007: GBP1,367,235) - 2007
included GBP280,000 revenue from the sale of a patent
* Expansion into new geographic territories
Chairman's Statement
Messaging International Plc continues to focus on building its position as a
leading provider of converged messaging services. During the year we made good
progress in forging strategic relationships and signing new deals in order to
expand the geographic reach and market presence of our wholly owned subsidiary,
TeleMessage Ltd ('TeleMessage'). The board remains committed to advancing the
Company's growth by providing effective marketing and sales strategies and
continuing developments in product and service offerings by focussing on its
differentiators of creativity, technological innovation and a sound
understanding of the markets it operates in.
The significant advantages of converged communication media are increasingly
being acknowledged by mobile users, and in turn, by the mobile operators that
they subscribe to. This provides an exciting arena for us to work in with
considerable opportunities. While our current relationships with key blue-chip
operators such as Sprint Nextel, Rogers Wireless, Telus and Bell Canada remain
of considerable importance we remain proactive in creating new alliances with
other operators and further developing existing partnerships.
In parallel to developing the reputation for delivering innovative proprietary
messaging solutions in the telecommunications industry, TeleMessage has also
managed to carve a position among the fastest growing technology companies by
once again, for the second consecutive year, gaining a high ranking in the
Deloitte Israel Technology Fast 50 (6th) and Deloitte Technology Fast 500 EMEA,
(29th). Securing such positions in such influential awards is a substantial
achievement for TeleMessage and illustrates the quality of our staff, our
products and services and our ability to adapt to the fast growing and
competitive messaging industry internationally.
Financial results
The results for the year ended 31 December 2008 show a loss of GBP367,267 (2007:
loss of GBP259,892), on revenue of GBP1,742,632 (2007: GBP1,367,235).
The Group's cash position at 31 December 2008 was GBP300,653 (2007: GBP355,780).
In August 2008, the Company announced the agreement of a $750,000 venture loan
from Mizrahi Tefahot Bank Ltd ('Mizrahi') to TeleMessage. Under the terms of the
loan, the Company withdrew $400,000 of this debt facility by 31 December 2008
and the remaining $350,000 in January 2009.
Repayments are over 24 instalments from the date of each drawdown. Mizrahi has
also approved an additional $50,000 credit facility should the Company require
further funding to support TeleMessage's next growth phase.
In 2008, the Company received grants from the Israeli Office of the Chief
Scientist. This support provides the Company with additional resources to invest
in the development of new products and has recently approved further funding of
$256,000 for 2009.
The board does not recommend the payment of a dividend.
Operations
The products and services developed by TeleMessage continue to provide new and
more convenient forms of integration between mobile phones, the Internet,
personal computers and landline phones. The agreements and partnerships that the
Company has developed with telecom operators and enterprises provide two main
revenue streams for TeleMessage:
* Software licensing - usually linked to the number of messages that can be sent
through the system or the number of active users
* Hosted platform - hosted messaging services for a per message fee
North America
TeleMessage has expanded its Text to Landline coverage across major mobile
carriers in the U.S and Canada. The agreement to launch the Text to Landline
service with Bell Mobility marked a significant step and resulted in the company
providing services to all the major mobile operators in Canada. Other major
mobile operators in North America that chose to use our integrated Text to
Landline service during the period included leading US based communications
group Qwest and Alltel Wireless, one of America's largest networks. Subsequently
Alltel Wireless was acquired by Verizon.
We have also made significant strides in further developing existing
relationships with our established customers such as Virgin Mobile U.S.A
('Virgin'). The size of the Spanish speaking population in the US has been
recognised by Virgin for its potential, leading to several bilingual services
being offered. TeleMessage has supported Virgin's efforts in this market niche
by developing the Spanish language text to landline service launched
successfully last year. Further functionality improvements have been made
through our personalisation feature with Sprint Nextel, which enables customers
to record their name at the beginning of their Text to Landline message. We have
seen considerable interest in both of these features since launch and we will
continue to be proactive in seeking out additional opportunities to extend our
Text to Landline service with both new and existing customers.
In February 2008, TeleMessage signed a partnership agreement with Mobixell
Networks, a U.S. based international provider of innovative mobile multimedia
and advertising solutions, to provide an Internet- to- Mobile phone video
streaming solution. This solution, which leverages TeleMessage's PC to Mobile
product suite and Mobixell's mobile multimedia and video suite, will enable PC
users to send video files taken from the internet to a mobile phone. This simple
solution that we have pioneered allows mobile operators to offer converged
fixed-mobile services and provides subscribers with user-friendly tools for self
content generation.
Europe and other territories
Having seen the strong uptake of PC to SMS services, sending multi-media ('MMS')
messages from a PC to a mobile seemed a natural evolution.
A leading messaging technology provider that recognised the inherent value of
our PC to Mobile application suite was Comverse, which integrated the service
for global availability into its comprehensive messaging portfolio and was
subsequently deployed by a leading tier-1 operator in Eastern Europe. This
contract is particularly important for TeleMessage as it acts as a stamp of
acceptance for our products from a worldwide leader in messaging, while
providing potential to significantly expand our marketing reach.
Our Text to Landline service has also received considerable interest over the
period with Claro Guatemala, the largest mobile carrier in Guatemala which has a
circa 4 million mobile customer base, launching the service in August. Post year
end Uralsviazinform, one of the four leading mobile operators in Russia, also
signed an agreement to launch the service. Both these agreements provide
TeleMessage with exposure to, and growth opportunities in markets in which it
has little or no presence until now.
Prospects
We continue to strive for creative and technological excellence in order to
maintain our position as industry leaders, strengthen current partnerships and
customer relationships and forge new alliances with mobile operators. We are
committed to extending our offering and expanding our geographic reach.
Electronic Communications
The directors wish to utilise the new provisions of the Companies Act 2006 and
to send documents and information electronically, thereby reducing printing and
postage costs. Accordingly, Resolution 8 is being proposed as a special
resolution at the annual general meeting, to make certain amendments to the
Company's articles of association to authorise the Company to send documents and
information to shareholders using electronic means which includes making them
available on the Company's website.
I would like to take this opportunity to thank all those involved in the Group
for their hard work and dedication over the past year.
H Furman
Chairman
29 June 2009
**ENDS**
For further information visit www.telemessage.com or contact:
+--------------------+----------------------------+-----------------------+
| Guy Levit | Messaging International | Tel: + 972 3 9225252 |
| | Plc | |
+--------------------+----------------------------+-----------------------+
| Mark Percy | Seymour Pierce Limited | Tel: +44 (0) 20 7107 |
| | | 8000 |
+--------------------+----------------------------+-----------------------+
| Susie Callear | St Brides Media & Finance | Tel: +44 (0) 20 7236 |
| | Ltd | 1177 |
+--------------------+----------------------------+-----------------------+
Consolidated income statement
For the year ended 31 December 2008
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | 2008 | | 2007 |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | Notes | | GBP | | GBP |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Revenues | | | | 1,742,632 | | 1,367,235 |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Cost of revenues | | | | (822,712) | | (536,697) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Gross profit | | | | 919,920 | | 830,538 |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Operating expenses | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Research and development | | | | (293,333) | | (333,668) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Selling and marketing | | | | (542,283) | | (368,481) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| General and administrative | | | | (418,210) | | (368,158) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Total operating expenses | | | | (1,253,826) | | (1,070,307) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Operating loss | | | | (333,906) | | (239,769) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Financial income | | | | 69 | | 2,319 |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Finance costs | | | | (33,430) | | (22,442) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Loss before taxation | | | | (367,267) | | (259,892) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Taxation | | 3 | | - | | - |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Loss for the year | | | | (367,267) | | (259,892) |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| Basic and diluted loss per share | | 4 | | (0.15)p | | (0.12)p |
+--------------------------------------+--+----------+--+--------------+--+--------------+
| | | | | | | |
+--------------------------------------+--+----------+--+--------------+--+--------------+
Consolidated statement of recognised income and expense
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | 2008 | | 2007 |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | GBP | | GBP |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| Foreign exchange difference on | | | 74,438 | | (11,334) |
| translation of foreign operations | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| Foreign exchange difference arising from | | | 669,645 | | - |
| restating the carrying value of goodwill | | | | | |
| associated with foreign operations | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| Loss for the year | | | (367,267) | | (259,892) |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| Total recognised income and expense for | | | 376,816 | | (271,226) |
| the year | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
| | | | | | |
+-------------------------------------------+-------+--+--------------+--+--------------+
Consolidated balance sheet
As at 31 December 2008
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | Notes | 2008 | | 2007 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | GBP | | GBP |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Non-current assets | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Goodwill | | | | 3,906,262 | | 3,236,617 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Property, plant and equipment | | | | 52,744 | | 25,047 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Other investments | | | | 135,330 | | 107,500 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total non-current assets | | | | 4,094,336 | | 3,369,164 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Current assets | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Trade and other receivables | | | | 576,907 | | 380,610 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Cash and cash equivalents | | | | 300,653 | | 355,780 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total current assets | | | | 877,560 | | 736,390 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total assets | | | | 4,971,896 | | 4,105,554 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Current liabilities | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Trade and other payables | | | | (382,856) | | (200,520) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Borrowings | | | | (109,282) | | - |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total current liabilities | | | | (492,138) | | (200,520) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Non-current liabilities | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Borrowings | | | | (42,174) | | - |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Provisions | | | | (165,879) | | (121,000) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total non-current liabilities | | | | (208,053) | | (121,000) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total liabilities | | | | (700,191) | | (321,520) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Net assets | | | | 4,271,705 | | 3,784,034 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Equity | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Share capital | | | | 1,176,900 | | 1,176,900 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Share premium | | | | 4,266,227 | | 4,266,227 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Foreign currency translation | | | | 709,704 | | (34,379) |
| reserve | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Revenue reserves | | | | (1,881,126) | | (1,624,714) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total Equity | | | | 4,271,705 | | 3,784,034 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
Company balance sheet
As at 31 December 2008
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | Notes | 2008 | | 2007 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | GBP | | GBP |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Non current assets | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Investment in subsidiary | | | | 3,269,000 | | 3,269,000 |
| undertakings | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total non-current assets | | | | 3,269,000 | | 3,269,000 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Current assets | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Trade and other receivables | | | | 2,073,806 | | 2,000,038 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Cash and cash equivalents | | | | 59,952 | | 160,011 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total current assets | | | | 2,133,758 | | 2,160,049 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total assets | | | | 5,402,758 | | 5,429,049 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Current liabilities | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Trade and other payables | | | | (25,851) | | (27,959) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total liabilities | | | | (25,851) | | (27,959) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Net assets | | | | 5,376,907 | | 5,401,090 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Equity | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Share capital | | | | 1,176,900 | | 1,176,900 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Share premium | | | | 4,266,227 | | 4,266,227 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Revenue reserves | | | | (66,220) | | (42,037) |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
| Total equity | | | | 5,376,907 | | 5,401,090 |
+-----------------------------------+--+-------+--------+--------------+--+--------------+
Consolidated cash flow statement
For the year ended 31 December 2008
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | Notes | | 2008 | | 2007 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | GBP | | GBP |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Cash flow from operating | | | | | | |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Operating loss | | | | (333,906) | | (239,769) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Adjustments for: | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Share based payment charges | | | | 11,887 | | 49,419 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Amortised finance costs | | | | 4,790 | | - |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Depreciation and amortisation | | | | 24,896 | | 19,394 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Foreign currency differences | | | | 43,287 | | (26,640) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | 84,860 | | 42,173 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Operating cash flow before | | | | (249,046) | | (197,596) |
| working capital movements | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Increase in receivables | | | | (196,297) | | (189,264) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Increase/(decrease) in payables | | | | 182,336 | | (8,827) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| (decrease)/increase in provisions | | | | (1,018) | | 30,106 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | (14,979) | | (167,985) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Cash outflow from operating | | | | (264,025) | | (365,581) |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Investing activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Interest paid (net) | | | | (5,234) | | (3,945) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Investments | | | | 12,946 | | (53,571) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Purchase of tangible assets | | | | (43,092) | | (1,006) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Net cash absorbed by investing | | | | (35,380) | | (58,522) |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Financing activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Issue of equity capital | | | | - | | 900,000 |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Share issue costs | | | | - | | (33,248) |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Bank loan | | | | 244,278 | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Net cash from financing | | | | 244,278 | | 866,752 |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Net change in cash and cash | | | | (55,127) | | 442,649 |
| equivalents | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Cash and cash equivalents and | | | | 355,780 | | (86,869) |
| bank overdraft at the beginning | | | | | | |
| of the year | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
| Cash and cash equivalents and | | 6 | | 300,653 | | 355,780 |
| bank overdraft at the end of the | | | | | | |
| year | | | | | | |
+-----------------------------------+-------+--------+--+--------------+---+-------------+
Company cash flow statement
For the year ended 31 December 2008
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | Notes | | 2008 | | 2007 |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | GBP | | GBP |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Cash flow from operating | | | | | | |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Operating loss | | | | (52,260) | | (32,586) |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Operating cash flow before | | | | (52,260) | | (32,586) |
| working capital movements | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Increase in receivables | | | | (73,768) | | (723,445) |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Decrease in payables | | | | (2,108) | | (5,834) |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Cash flow from operating | | | | (128,136) | | (761,865) |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Financial income | | | | 28,077 | | 9,881 |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Net cash used in operating | | | | (100,059) | | (751,984) |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Financing activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Issue of equity capital | | | | - | | 900,000 |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Share issue costs | | | | - | | (33,248) |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Net cash from financing | | | | - | | 866,752 |
| activities | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Net change in cash and cash | | | | (100,059) | | 114,768 |
| equivalents | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Cash and cash equivalents and | | | | 160,011 | | 45,243 |
| bank overdraft at the beginning | | | | | | |
| of the year | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
| Cash and cash equivalents and | | 6 | | 59,952 | | 160,011 |
| bank overdraft at the end of the | | | | | | |
| year | | | | | | |
+-----------------------------------+-------+--------+--+--------------+--+--------------+
Independent Auditors' Report
We have audited the Group and parent company financial statements ('the
financial statements') of Messaging International Plc for the year ended 31
December 2008 which comprise the consolidated income statement, the consolidated
statement of recognised income and expense, the consolidated and company balance
sheets, the consolidated and company cash flow statements, and the related
notes. These financial statements have been prepared under the accounting
policies set out therein.
This report is made solely to the Company's members, as a body, in accordance
with Section 235 of the Companies Act 1985. Our audit work has been undertaken
so that we might state to the Company's members those matters we are required to
state to them in an auditor's report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the company and the Company's members as a body, for our audit work,
for this report, or the opinions we have formed.
Respective responsibilities of directors and auditors
The directors' responsibilities for preparing the annual report and the
financial statements in accordance with applicable law and International
Financial Reporting Standards ('IFRSs'), as adopted by the European Union are
set out in the statement of directors' responsibilities.
Our responsibility is to audit the financial statements in accordance with
relevant legal and regulatory requirements and International Standards on
Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true
and fair view and are properly prepared in accordance with the Companies Act
1985 and as regards to group financial statements Article 4 of the IAS
Regulation. We also report to you whether in our opinion the information given
in the Directors' Report is consistent with the financial statements. The
information given in the Directors' Report includes the specific information
presented in the Chairman's Statement that is cross referred from the business
review section of the directors' report.
In addition we report to you if, in our opinion, the Company has not kept proper
accounting records, we have not received all the information and explanations we
require for our audit, or if information specified by law regarding directors'
remuneration and other transactions is not disclosed.
We read other information contained in the Annual Report and consider whether it
is consistent with the audited financial statements. This other information
comprises the Directors' Report, the Chairman's Statement, and the Corporate
Governance Statement. We consider the implications for our report if we become
aware of any apparent misstatements or material inconsistencies with the
financial statements. Our responsibilities do not extend to any other
information.
Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing
(UK and Ireland) issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements. It also includes an assessment of the
significant estimates and judgements made by the directors in the preparation of
the financial statements, and of whether the accounting policies are appropriate
to the Group's and parent company's circumstances, consistently applied and
adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion:
* The Group financial statements give a true and fair view, in accordance with
International Financial Reporting Standards (IFRS's) as adopted by the European
Union, of the state of Group's affairs as at 31 December 2008 and of the Group's
loss for the year then ended;
* The parent company financial statements give a true and fair view in accordance
with IFRS's as adopted in the European Union as applied in accordance with the
provisions of the Companies Act 1985 of the state of the parent company's
affairs at 31 December 2008.
* The financial statements have been properly prepared in accordance with the
Companies Act 1985; and as regards the group financial statements, Article 4 of
the IAS Regulation;
* The information given in the Directors' Report is consistent with the financial
statements.
Emphasis of matter: - Going concern and goodwill impairment
In forming our opinion on the financial statements, which is not qualified, we
draw your attention to notes 5a and 15 of the financial statements which
indicate the Group's ability to continue as a going concern and the basis on
which the carrying value of goodwill has been determined respectively. The Group
incurred a net loss of GBP367,267 for the year ended 31 December 2008. These
conditions, along with the other matters explained in notes 5a and 15 of the
financial statements in the Annual Report and Accounts, indicate the existence
of material uncertainties which may cast significant doubt about the Group's
ability to continue as a going concern and whether goodwill may become impaired.
Jeffreys Henry LLP
Chartered Accountants and Registered Auditors
5-7 Cranwood Street
Finsgate
London EC1V 9EE
29 June 2009
Notes to the group and parent company financial statements
+----+-------------------------+
| 1. | General Information |
+----+-------------------------+
Messaging International Plc is a company incorporated in the UK and its
activities are as described in the chairman's statement and directors' report.
+----+-------------------------+
| 2. | Basis of Accounting |
+----+-------------------------+
The consolidated financial statements of the Company for the year ended 31
December 2008 have been prepared on a historical cost basis and are in
accordance with International Financial Reporting Standards ('IFRS') as adopted
by the EU. These have been applied consistently except where otherwise stated.
+----+-------------------------+
| 3. | Taxation |
+----+-------------------------+
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | 2008 | | 2007 |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | GBP | | GBP |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Current tax charge | | | | | - | | - |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Factors affecting the tax charge in the year | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Loss on ordinary activities before taxation | | | | | (367,267) | | (259,892) |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Loss on ordinary activities before taxation at | | | | | (102,835) | | (77,967) |
| the standard rate of UK corporation tax 28% | | | | | | | |
| (2007: 30%) | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Effects of: | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Depreciation and amortisation | | | | | 6,971 | | 5,818 |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Non recognition of losses | | | | | 95,864 | | 72,149 |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| | | | | | | | |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
| Tax charge | | | | | - | | - |
+---------------------------------------------------+---+---+---+--+---------------+--+---------------+
In accordance with IAS12, the Company and the Group have not recognised deferred
tax assets as they do not anticipate that profits generated in the short term
will exceed accumulated losses generated by subsidiary undertakings.
In addition, TeleMessage Ltd in Israel was granted approved enterprise status
for its investment programme. The main benefit arising from such status is the
reduction in tax rates on income. The Company's income from the 'Approved
Enterprises Scheme' is tax exempt for four years commencing with the year it
first earns taxable income and then would be subject to a reduced tax rate of
between 10% and 25% for a period of up to six years. Since the Company has
incurred losses to date it has not utilised any of the aforementioned tax
benefits.
+----+--------------------------------------+
| 4. | Basic and diluted loss per share |
+----+--------------------------------------+
Basic loss per share has been calculated on the Group's loss attributable to
equity holders of the parent company of GBP367,267 (2007: GBP259,892) and on the
weighted average number of shares in issue during the year, which was
235,380,000 (2007: 217,498,000).
In view of the Group loss for the year, 50 million share warrants, 100 million
new warrants and 13.8 million options to subscribe for ordinary shares in the
Company are anti-dilutive and therefore diluted earnings per share information
is not presented.
+----+--------------------------------------+
| 5. | Statements on movement in equity |
+----+--------------------------------------+
+--------------------------------------------------------------+------------+--+------------+
| | 2008 | | 2007 |
+--------------------------------------------------------------+------------+--+------------+
| | GBP | | GBP |
+--------------------------------------------------------------+------------+--+------------+
| Group | | | |
+--------------------------------------------------------------+------------+--+------------+
| Loss for the year | (367,267) | | (259,892) |
+--------------------------------------------------------------+------------+--+------------+
| Equity-settled share based payments for employee share | 11,887 | | 49,419 |
| options | | | |
+--------------------------------------------------------------+------------+--+------------+
| Equity-settled share based payments for warrants relating to | 98,968 | | - |
| borrowings | | | |
+--------------------------------------------------------------+------------+--+------------+
| Foreign currency translation changes | 744,083 | | (11,334) |
+--------------------------------------------------------------+------------+--+------------+
| Share issue net of costs | - | | 866,752 |
+--------------------------------------------------------------+------------+--+------------+
| Equity at 1 January | 3,784,034 | | 3,139,089 |
+--------------------------------------------------------------+------------+--+------------+
| | | | |
+--------------------------------------------------------------+------------+--+------------+
| Equity at 31 December | 4,271,705 | | 3,784,034 |
+--------------------------------------------------------------+------------+--+------------+
| | | | |
+--------------------------------------------------------------+------------+--+------------+
| Company | | | |
+--------------------------------------------------------------+------------+--+------------+
| | | | |
+--------------------------------------------------------------+------------+--+------------+
| Loss from continuing operations | (24,183) | | (22,705) |
+--------------------------------------------------------------+------------+--+------------+
| Equity at 1 January | 5,401,090 | | 4,557,043 |
+--------------------------------------------------------------+------------+--+------------+
| Share issue net of costs | | | 866,752 |
+--------------------------------------------------------------+------------+--+------------+
| Equity at 31 December | 5,376,907 | | 5,401,090 |
+--------------------------------------------------------------+------------+--+------------+
+--------------------------------+----------------+----------------+----------------+--+-----------+--+-------------+
| 6. | Cash and cash equivalents and |
| | bank overdraft |
+--------------------------------+---------------------------------+
| | At | | Cash Flow | | At |
| | 1 January | | | | 31 December |
| | 2008 | | | | |
| | | | | | 2008 |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| | GBP | | GBP | | GBP |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| Group | | | | | |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| Cash | 355,780 | | (55,127) | | 300,653 |
| and | | | | | |
| cash | | | | | |
| equivalents | | | | | |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| | | | | | |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| Company | | | | | |
+-------------------------------------------------+---------------------------------+--+-----------+--+-------------+
| Cash | 160,011 | | (100,059) | | 59,952 |
| and | | | | | |
| cash | | | | | |
| equivalents | | | | | |
+--------------------------------+----------------+----------------+----------------+--+-----------+--+-------------+
+----+----------------------------+
| 7. | Annual Report & Accounts |
+----+----------------------------+
A copy of the Annual Report and Accounts for the year ended 31 December 2008 has
been sent to shareholders today and copies are available from the Company's
registered office at 58-60 Berners Street, London W1T3JS or by visiting the
Company website at www.telemessage.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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