TIDMMIRI
RNS Number : 2918Y
Mirriad Advertising PLC
12 May 2021
12 May 2021
Mirriad Advertising plc
("Mirriad" or the "Company")
Results for the year ended 31 December 2020
Mirriad, the leading in-content advertising company, announces
its audited results for the year ended 31 December 2020.
Financial overview
-- 2020 revenue up 91% to GBP2.18m (2019: GBP1.14m)
-- Operating loss reduced by 25% to GBP9.09m (2019: GBP12.17m)
-- Cash consumption down 27% to GBP8.06m (2019: GBP11.01m)
-- Net assets at 31 December 2020 up 84% GBP35.3m (2019: GBP19.2m)
-- Cash and cash equivalents at 31 December 2020 up 85% to GBP35.4m (2019: GBP19.1 million)
Operational highlights
-- Broadcast and digital distributor supply partners under contract up 33% to 20 (2019: 15)
-- Framework agreement signed with Tier One US entertainment giant in October 2020
-- Launched Music Alliance with globally renowned record labels and independent music companies
-- Achieved an OTCQB cross listing in September 2020, under ticker symbol "MMDDF"
-- Executed an oversubscribed Placing and Open Offer, raising
GBP26.2 million (gross) in December 2020, positioning the business
for future growth
Post period highlights
-- Framework agreement reached with one of the world's leading
food and beverage companies to incentivise spend on in-video
campaigns in the US market.
-- Commercial negotiations complete to replace the expired
contract with Tencent Video and detailed contractual terms are now
being discussed
-- Appointment of new CTO in February 2021 and new CRO in May 2021
-- Appointment of Kelsey Lynn Skinner as non-executive director in February 2021
-- Boosted US sales capabilities with the appointment of an
additional senior sales manager and an outsourced sales enablement
company in February 2021
-- Upgraded to OTCQX listing in the US in April 2021
Stephan Beringer, CEO of Mirriad, said: "In 2020 we provided
operational stability during a challenging period, with adverse
effects of the Covid-19 pandemic affecting the wider advertising
and content industries. We have been able to reduce our own costs
through prudent management and also drive additional revenue,
underlining our commitment to building long-term shareholder
value.
" Mirriad is now well placed to benefit from the expected
advertising sector recovery in the second half of this year. Thanks
to our technology's ability to create new revenue opportunities
whilst addressing established consumer aversion to interruptive
advertising, we can offer more in-content opportunities to a rising
number of advertisers and agencies, showing a clear pathway to
scale in 2021 and beyond.
"The industry increasingly recognises the fantastic results our
format delivers as we further develop the protected Mirriad
technology that will ultimately define the in-content advertising
space. With these factors considered, we are confident about the
future growth of our proposition and business."
S
For further information please visit www.mirriad.com or
contact:
Mirriad Advertising plc Tel: +44 (0)207 884 2530
Stephan Beringer, Chief Executive
Officer
David Dorans, Chief Financial
Officer
Nominated Adviser & Broker: Tel: +44 (0)20 7523 8000
Canaccord Genuity Limited
Simon Bridges
Richard Andrews
Thomas Diehl
Financial Communications:
Charlotte Street Partners
Tom Gillingham Tel: +44 (0) 7741 659021
Andrew Wilson Tel: +44 (0) 7810 636995
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014 ("MAR"). Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Notes to Editors
About Mirriad
Mirriad's award-winning solution unleashes new revenue for
content producers and distributors by creating new advertising
inventory in content. Our patented, AI and computer vision
technology dynamically inserts products and innovative signage
formats after content is produced. Mirriad's market-first solution
seamlessly integrates with existing subscription and advertising
models, and dramatically improves the viewer experience by limiting
commercial interruptions.
Mirriad currently operates in the US, Europe and China.
Forward looking statements
Certain information contained in this announcement, including
any information as to the Group's strategy, plans or future
financial or operating performance, constitutes "forward-looking
statements". These forward-looking statements may be identified by
the use of forward-looking terminology, including the terms
"believes", "estimates", "anticipates", "projects", "expects",
"intends", "aims", "plans", "predicts", "may", "will", "seeks"
"could" "targets" "assumes" "positioned" or "should" or, in each
case, their negative or other variations or comparable terminology,
or by discussions of strategy, plans, objectives, goals, future
events or intentions. These forward-looking statements include all
matters that are not historical facts. They appear in a number of
places throughout this announcement and include statements
regarding the intentions, beliefs or current expectations of the
Directors concerning, among other things, the Group's results of
operations, financial condition, prospects, growth, strategies and
the industries in which the Group operates. The directors of the
Company believe that the expectations reflected in these statements
are reasonable, but may be affected by a number of variables which
could cause actual results or trends to differ materially. Each
forward-looking statement speaks only as of the date of the
particular statement.
By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future or are beyond
the Group's control. Forward-looking statements are not guarantees
of future performance. Even if the Group's actual results of
operations, financial condition and the development of the
industries in which the Group operates are consistent with the
forward-looking statements contained in this document, those
results or developments may not be indicative of results or
developments in subsequent periods.
Chairman's statement
Last year, I said that the priority for 2020 would be converting
positive sentiment towards Mirriad into tangible engagement.
Despite the disrupting influence of the COVID-19 pandemic, I am
delighted with the progress that has been made against this central
ambition.
Continuing confidence from investors and shareholders has
allowed Mirriad to become the market leader in in-content.
advertising, but there is - of course - more work to be done.
The signing of a new framework agreement with a tier one US
entertainment giant in October was a major milestone for the
Company, a validation of our technology and a demonstration of how
far we have come after resetting the Company in 2019.
This was followed by the announcement of the Mirriad Music
Alliance, a partnership with globally renowned record labels and
leading independent music companies to bring brands immediate
access to millions of consumers through over a thousand global
artists.
Both announcements demonstrate the flexibility of Mirriad's
technology and its ability to adapt with ease to reach into new
growth markets. The team is excited about the potential of the
music sector in particular for 2021.
Over the summer we saw an increasing level of activity in China
via our partner Tencent. This demonstrates how effective Mirriad
can be when it is integrated with a partner's systems, and this
offers a blueprint of how we can drive real scale in the
future.
The year closed with a heavily oversubscribed fundraising round,
offering another indication of the enthusiasm for the Mirriad
solution amongst existing and new investors. The money raised gives
us the resources required to drive further scale.
The ongoing backdrop of a global pandemic makes all of these
achievements all the more significant, and I would like to pay
tribute to the hard work across the business that has made all of
this possible.
Engaging with our stakeholders
The Board, Stephan and I take our responsibilities to
shareholders and wider stakeholders seriously. In line with
pandemic restrictions, face-to-face events other than our
technology showcase in January 2020 have been limited, but we have
continued our engagement through digital platforms.
The management team is also actively engaged with broadcasters
and digital content platforms, advertising agencies and senior
international advertisers.
As well as undertaking many virtual meetings over the course of
the year, we have sought to maintain exceptional standards of
communication around significant events by offering our
stakeholders opportunities to join webinars presented by the
management team.
The Company has continued to demonstrate its resilience in the
COVID-19 environment with all staff working effectively from home
or in line with local restrictions. In this environment, engagement
is more critical than ever and Mirriad actively communicates with
its employees via regular staff surveys and monthly virtual Town
Hall meetings.
The year ahead
The focus for the year ahead will be building Mirriad as the
media solution for a new era in audience engagement. This will be
achieved by stimulating direct demand and putting in place the
sales architecture and data capability to scale within this
competitive market.
While the macroeconomic outlook is still uncertain, our recent
activity has given me confidence that the Mirriad solution is well
positioned to respond to changing viewing habits and to provide
value in what is a growing addressable market. The fundamental fact
that audiences prefer the Mirriad format to other more disruptive
advertising types, and the fact that it is proven to drive
increased brand consideration, gives us a compelling competitive
advantage at a time when broadcasters, content creators and
distributors are all looking for new sources of revenue.
John Pearson
Non-executive chairman
12 May 2021
CEO's statement
Much of last year's focus was on taking the Mirriad story to
external audiences in the market and building momentum for the new
advertising format after our strategic reset. Following a
successful fundraise and increasing our profile, we will now focus
our efforts on creating a Mirriad architecture that will ultimately
build and define the in-content advertising space.
COVID-19 related filming and travel restrictions have added to
the ongoing upheaval of the advertising ecosystem, and with
inventory at a premium, Mirriad is well placed to benefit from the
steady increase in streaming and sustained consumer aversion to
interruptive advertising. We are confident that our in-content
solution marks a step change from established advertising formats,
giving producers, advertisers and content creators a bold and
sustainable new format to drive engagement.
Increased demand and momentum
We have worked hard to increase momentum through engagement with
senior stakeholders at advertising clients, agency groups as well
as the linear and digital content platforms and companies, and now
the time is right to renew our focus on three key areas for
2021.
Firstly our technology and platform will be at the heart of
everything we do in the year ahead - it is vital we press on and
further refine our infrastructure to allow it to be effectively
'plugged' into our partners' platforms and the entire ad buying and
delivery ecosystem.
Secondly, to support this drive for scale, we will further ramp
up automation. Improved automation will transform the scale,
precision and speed at which Mirriad and our partners look at and
plan inventory; decide on the insertion opportunities; process
in-content ads, eventually in multiple variations; and track
delivery and results for the purpose of optimisation.
This is particularly true for our expansion into the music
sector and other content areas where Mirriad is in charge of the
inventory transaction. New levels of data intelligence, automation
and integration will be the pivot into a scaled media proposition.
We have a great technical team that we are supplementing with
strategic hires. The addition of an experienced new CTO, Philip
Mattimoe, at the start of this year is the latest piece in our
technology jigsaw.
US sales
Finally, we must drive more sales in the US in particular. We
have added to our US sales capability and this will improve our
ability to stimulate direct demand. Alongside this, we will
continue to seek opportunities in sectors like music to realise
growth potential in our expanding addressable markets.
Our technology is patent-protected and industry-defining. With
strong fundamentals now in place, I look forward to sharing more
detailed updates in this area throughout, what I believe will be,
another exciting year for Mirriad. The advertising and media
industries are going through times of profound change. From the
shift to more streaming services to the sunsetting of the cookie,
engaging with consumers needs a new approach and formula.
In-content advertising and contextual targeting are the keys to a
new era, and the continuous improvements in our protected and
awarded technology, as well as the integration with the ecosystem,
will ultimately drive the mass adoption of the new format that
Mirriad is leading with.
Stephan Beringer
Chief Executive Officer
12 May 2021
Financial review
Introduction
Figures published by Zenith suggest that Worldwide advertising
expenditure declined by 9.1% in 2020 with declines experienced in
all of Mirriad's operating markets as Covid-19 impacted the global
content and advertising business. In contrast 2020 saw Mirriad
achieve our highest ever revenue despite the impact of Covid-19.
The Company completed a successful fundraising of GBP26.2 million
(gross) at the end of December 2020 which gives us the financial
resources to continue to invest in our technology and building our
sales capability, particularly in the US. All three of the
Company's KPIs improved substantially over the year with revenues
up 91.3%, cash consumption down by 26.6% and customers under
contract up by 33.3%.
Current year results
Revenue for the year was almost double the prior year at GBP2.18
million (2019: GBP1.14 million) largely based on the revenue
guaranteed in the Tencent contract. During the year the Group
continued to focus on developing its operations in the US, the
world's largest advertising market, and Europe. In the US, we
announced a deal with a major tier one entertainment giant in the
final quarter and ran the first campaign for that partner in
December. This deal adds to the existing supply partner
relationships in the US with Univision, Condé Nast and Tastemade.
We also concluded a new deal with A&E Networks in the US
shortly before the year end having added deals with Meredith and
Fuse Media earlier in 2020. In Europe, we focussed on France where
the Company continues to work with the major broadcasters and we
ran a number of campaigns for France Televisions. As in previous
years we caution that sales cycles with large broadcasters and
distributors are long and therefore it will take time to scale
revenues.
Revenue was particularly strong in China based on our exclusive
deal with Tencent video announced in July 2019. This deal expired
in March 2021 and some of the revenue under the contract was
deferred from 2020 into 2021 as Covid impacted the volume of
campaigns booked during 2020.
As a result of the increased level of revenue gross margin
increased to GBP1.94 million (2019: GBP0.96 million). As noted in
previous years the Company is making steady progress in automating
key elements of its production process and our teams work with our
technology to deliver campaigns. The vast majority of our Cost of
Sales relates to our staff based in Mumbai. The staff element of
this work is largely fixed at current volumes which means that
margin is impacted by the throughput of work and has the potential
to improve significantly as these volumes increase.
The Group's principal cost is staff. We previously reported that
we had undertaken a significant volume of restructuring in 2019 and
the impact of these changes have now fed through to our income
statement. Over the course of 2020 administrative expenses
decreased to GBP11.22 million (2019: GBP13.16 million). The Company
took the decision not to furlough or put any staff on short working
during the year to allow us to maintain momentum and continue our
commitment to expanding scale.
The Company has continued to review and monitor the application
of IAS 38 with respect to the capitalisation of development cost.
The Company has continued to take the view that due to the
uncertainty of future revenue generation it will not capitalise any
development cost in 2020 even though technology remains key to the
Company's business and internally generated software and IP remains
a key focus for future development of the business. Accordingly,
the income statement includes GBP2.43 million (2019: GBP2.32
million) related to research and development ("R&D") activity.
In total expenditure on the Company's technology team increased by
GBP0.12 million as average headcount was modestly increased.
The reduction in operating costs and improvement in gross margin
fed through to EBITDA with the EBITDA loss decreasing to GBP8.63
million (2019: GBP11.51 million). Likewise, the loss for the year
before tax decreased to GBP9.09 million (2019: GBP12.15
million).
Tax
The Group has not recognised any tax assets in respect of
trading losses arising in the current financial year or accumulated
losses in previous financial years. The tax credit recognised in
the current and previous financial years arises from the receipt of
R&D tax credits.
Earnings per share
Loss per share was 4p per share (2019: loss of 8p per share) as
a result of the reduction in operating costs over the year and the
increase in the Company's issued share capital. This calculation is
based on the weighted average number of shares in issue during the
financial year.
Dividend
No dividend has been proposed for the year ended 31 December
2020 (2019: GBPnil).
Cash flow
Net cash used in operations was GBP8.06 million (2019: GBP10.95
million) as the benefits of the Group's restructuring flowed
through to cash. The Group incurred GBP25,202 (2019: GBP62,484) of
capital expenditure on tangible assets in the year. Net proceeds
from the issue of shares in December 2020 totalled GBP24.78 million
(2019: GBP15.29 million) following the successful fundraising.
Balance sheet
Net assets increased to GBP35.3 million (2019: GBP19.2 million)
as a result of the proceeds from the issue of shares net of the
losses for the year. Cash and cash equivalents at 31 December 2020
were GBP35.4 million (2019: GBP19.1 million).
Accounting policies
The Group's consolidated financial information has been prepared
in accordance with International Financial Reporting Standards in
conformity with the requirements of the Companies Act 2006.
Going concern
The financial statements have been prepared on a going concern
basis. This is supported by the Company's successful fundraise in
December 2020, where an additional GBP26.2m (gross) proceeds were
raised, the substantial cash balance of GBP35.42m at the year end,
the fact that the Company is debt free with no external borrowing
and the Company's net cash outflow of GBP8.06m for 2020. After
making enquiries and producing cash flow forecasts in a variety of
scenarios, the Directors have reasonable expectations, as at the
date of approving the financial statements, that the Company and
the Group will have adequate resources to fund the activities of
the Company and the Group for the next 12 months from the date of
the financial statements.
David Dorans
Chief Financial Officer
12 May 2020
Consolidated statement of profit or loss
For the year ended 31 December 2020
Year ended Year ended
31 December 31 December
2020 2019
Note GBP GBP
-------------------------------- ---- ------------ ------------
Revenue 3 2,179,919 1,139,538
Cost of sales (244,359) (178,091)
-------------------------------- ---- ------------ ------------
Gross profit 1,935,560 961,447
Administrative expenses (11,216,312) (13,159,812)
Other operating income 188,306 24,421
-------------------------------- ---- ------------ ------------
Operating loss 4 (9,092,446) (12,173,944)
Finance income 34,339 46,436
Finance costs (30,702) (23,627)
-------------------------------- ---- ------------ ------------
Finance income - net 3,637 22,809
Loss before income tax (9,088,809) (12,151,135)
Income tax credit 32,429 56,231
-------------------------------- ---- ------------ ------------
Loss for the year (9,056,380) (12,094,904)
-------------------------------- ---- ------------ ------------
Loss per Ordinary Share - basic 5 (4p) (8p)
-------------------------------- ---- ------------ ------------
All activities are classified as continuing.
Consolidated statement of comprehensive income
For the year ended 31 December 2020
Year ended Year ended
31 December 31 December
2020 2019
GBP GBP
---------------------------------------------------------- ----------- ------------
Loss for the financial year (9,056,380) (12,094,904)
---------------------------------------------------------- ----------- ------------
Other comprehensive (loss) / income
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign operations (646) 136,179
---------------------------------------------------------- ----------- ------------
Total comprehensive loss for the year (9,057,026) (11,958,725)
---------------------------------------------------------- ----------- ------------
Items in the statement above are disclosed net of tax.
Consolidated balance sheet
At 31 December 2020
Group
------------
As at As at
31 December 31 December
2020 2019
GBP GBP
--------------------------------- ------------ ------------
Assets
Non-current assets
Property, plant and equipment 636,543 912,983
Intangible assets - -
Investments - -
Trade and other receivables 186,021 212,143
---------------------------------- ------------ ------------
822,564 1,125,126
--------------------------------- ------------ ------------
Current assets
Trade and other receivables 1,475,785 1,024,996
Other current assets 72,993 76,754
Cash and cash equivalents 35,421,396 19,091,613
---------------------------------- ------------ ------------
36,970,174 20,193,363
--------------------------------- ------------ ------------
Total assets 37,792,738 21,318,489
---------------------------------- ------------ ------------
Liabilities
Non-current liabilities
Lease liabilities 204,437 423,328
---------------------------------- ------------ ------------
204,437 423,328
--------------------------------- ------------ ------------
Current liabilities
Trade and other payables 1,913,845 1,297,624
Current tax liabilities 13,361 24,809
Lease liabilities 390,220 373,227
---------------------------------- ------------ ------------
2,317,426 1,695,660
--------------------------------- ------------ ------------
Total liabilities 2,521,863 2,118,988
---------------------------------- ------------ ------------
Net assets 35,270,875 19,199,501
---------------------------------- ------------ ------------
Equity and liabilities
Equity attributable to owners of
the parent
Share capital 52,688 52,029
Share premium 65,710,297 40,932,183
Share-based payment reserve 2,850,571 2,500,944
Retranslation reserve (143,298) (142,652)
Accumulated losses (33,199,383) (24,143,003)
---------------------------------- ------------ ------------
Total equity 35,270,875 19,199,501
---------------------------------- ------------ ------------
Consolidated statement of changes in equity
For the year ended 31 December 2020
Year ended 31 December 2019
-------------------------------------------------------------------------------
Share-based Retranslation Accumulated
Share payment
capital Share premium reserve reserve losses Total equity
GBP GBP GBP GBP GBP GBP
-------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Balance at 1 January 2019 50,949 25,643,192 2,141,094 (278,831) (12,048,099) 15,508,305
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Loss for the financial
year - - - - (12,094,904) (12,094,904)
Other comprehensive income
for the year - - - 136,179 - 136,179
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Total comprehensive loss
for the year - - - 136,179 (12,094,904) (11,958,725)
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Proceeds from shares issued 1,080 16,196,750 - - - 16,197,830
Share issue costs - (907,759) - - - (907,759)
Share-based payments recognised
as expense - - 359,850 - - 359,850
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Total transactions with
shareholders recognised
directly in equity 1,080 15,288,991 359,850 - - 15,649,921
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Balance at 31 December
2019 52,029 40,932,183 2,500,944 (142,652) (24,143,003) 19,199,501
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Year ended 31 December 2020
-------------------------------------------------------------------------------
Retained
earnings/
Share-based Retranslation (accumulated
Share payment
capital Share premium reserve reserve losses) Total equity
GBP GBP GBP GBP GBP GBP
-------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Balance at 1 January 2020 52,029 40,932,183 2,500,944 (142,652) (24,143,003) 19,199,501
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Loss for the financial
year - - - - (9,056,380) (9,056,380)
Other comprehensive loss
for the year - - - (646) - (646)
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Total comprehensive loss
for the year - - - (646) (9,056,380) (9,057,026)
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Proceeds from shares issued 659 26,228,815 - - - 26,229,474
Share issue costs - (1,450,701) - - - (1,450,701)
Share-based payments recognised
as expense - - 349,627 - - 349,627
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Total transactions with
shareholders recognised
directly in equity 659 24,778,114 349,627 - - 25,128,400
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Balance at 31 December
2020 52,688 65,710,297 2,850,571 (143,298) (33,199,383) 35,270,875
--------------------------------- -------- ------------- ----------- ------------- ------------ ------------
Consolidated statement of cash flows
For the year ended 31 December 2020
Group
-------------------------
2020 2019
GBP GBP
-------------------------------------- ----------- ------------
Cash used in operations (8,146,368) (11,222,098)
Tax credit received 99,886 291,502
Taxation paid (17,697) (43,288)
Interest received 34,339 46,436
Lease interest paid (30,702) (23,627)
--------------------------------------- ----------- ------------
Net cash used in operating activities (8,060,542) (10,951,075)
--------------------------------------- ----------- ------------
Cash flow from investing activities
Purchase of tangible assets (25,202) (62,484)
Proceeds from disposal of tangible
assets 100 236
--------------------------------------- ----------- ------------
Net cash used in investing activities (25,102) (62,248)
--------------------------------------- ----------- ------------
Cash flow from financing activities
Proceeds from issue of Ordinary
Share capital
(net of costs of issue) 24,778,773 15,290,071
Payment of lease liabilities (363,346) (389,055)
--------------------------------------- ----------- ------------
Net cash generated from financing
activities 24,415,427 14,901,016
--------------------------------------- ----------- ------------
Net increase in cash and cash
equivalents 16,329,783 3,887,693
Cash and cash equivalents at
the beginning of the year 19,091,613 15,203,920
--------------------------------------- ----------- ------------
Cash and cash equivalents at
the end of the year 35,421,396 19,091,613
--------------------------------------- ----------- ------------
Cash and cash equivalents consists
of
Cash at bank and in hand 35,421,396 19,091,613
--------------------------------------- ----------- ------------
Cash and cash equivalents 35,421,396 19,091,613
--------------------------------------- ----------- ------------
Notes to the consolidated financial statements
For the year ended 31 December 2020
1. Corporate Information
Mirriad Advertising plc is a public limited company incorporated
and domiciled in the UK and registered in England with company
registration number 09550311. The Company's registered office is
6th Floor, One London Wall, London, EC2Y 5EB.
2. Basis of preparation
The financial information set out above does not constitute the
Group's statutory accounts for the years ended 31 December 2020 or
2019 but is derived from those accounts. Statutory accounts for
2019 have been delivered to the registrar of companies, and those
for 2020 will be delivered in due course. The auditor has reported
on those accounts; their reports were (i) unqualified, (ii) did not
include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report and
(iii) did not contain a statement under section 498 (2) or (3) of
the Companies Act 2006.
The consolidated financial information has been prepared in
accordance with International Financial Reporting Standards (IFRS)
and IFRS Interpretations Committee ("IFRS IC") interpretations in
conformity with the requirements of the Companies Act 2006
applicable to companies reporting under IFRS,
The financial information contained in these financial
statements have been prepared under the historical cost convention,
and on a going concern basis.
The accounting policies applied are consistent with those of the
annual report and accounts for the year ended 31 December
2019.
(a) New standards, amendments and interpretations
The Group has applied the following standards and amendments for
the first time for the annual reporting period commencing 1 January
2020:
-- Definition of material - Amendments to IAS 1 and IAS 8;
-- Definition of a Business - Amendments to IFRS 3;
-- Interest Rate Benchmark Reform - Amendments to IFRS 7, IFRS 9 and IAS 39;
-- Revised Conceptual Framework for Financial Reporting;
The new standards listed above did not have any material impact
on the amounts recognised in the current period and are not
expected to significantly affect future periods.
(b) New standards, amendments and interpretations not yet
adopted
A number of new standards and amendments to standards and
interpretations are effective for annual periods beginning after 1
January 2021, and have not been applied in preparing these
financial statements. These standards are not expected to have a
material impact on the entity in the current or future reporting
periods or on foreseeable future transactions.
3. Segment information
Management mainly considers the business from a geographic
perspective since the same services are effectively being sold in
every Group entity. Therefore regions considered for segmental
reporting are where the Company and subsidiaries are based, namely
the UK, the USA, India, and China. The Singapore office was closed
in early 2020. The revenue is classified by where the sales were
booked not by the geographic location of the customer. For this
reporting purpose the Singapore and China entities are considered
together.
The only income outside of the primary business activity relates
to income received from grants which is recognised in other
operating income.
The amount of revenue from external customers by location of the
Group billing entity is shown in the tables below.
2020 2019
Revenue GBP GBP
---------------------- --------- ---------
Turnover by geography
China and Singapore 1,765,196 776,115
USA 313,967 160,432
UK 100,756 139,735
India - 38,549
Brazil - 24,707
---------------------- --------- ---------
Total 2,179,919 1,139,538
---------------------- --------- ---------
2020 2019
GBP GBP
---------------------- --------- ---------
Turnover by category
Rendering of services 2,179,919 1,139,538
---------------------- --------- ---------
Total 2,179,919 1,139,538
---------------------- --------- ---------
2020 2019
Revenues from external customers by country, based
on the destination of the customer GBP GBP
--------------------------------------------------- --------- ---------
China 1,780,905 834,887
USA 313,967 160,432
France 31,559 9,633
Turkey 22,010 -
UK 21,700 56,500
India - 38,549
Brazil - 24,707
Ireland - 7,750
Germany - 7,080
Other 9,778 -
--------------------------------------------------- --------- ---------
Total 2,179,919 1,139,538
--------------------------------------------------- --------- ---------
4. Operating loss
The Group operating loss is stated after
charging/(crediting):
2020 2019
GBP GBP
------------------------------------------------- ---------- ----------
Employee benefits 7,559,195 8,123,117
Depreciation of property, plant and equipment 466,097 498,411
Amortisation and impairment of intangible assets - 170,053
Foreign exchange movements 28,040 168,319
Other general and administrative costs 3,407,339 4,378,003
Other operating income (188,306) (24,421)
-------------------------------------------------- ---------- ----------
Total cost of sales, administrative expenses
and other operating income 11,272,365 13,313,482
-------------------------------------------------- ---------- ----------
Other operating income includes income received from government
grants and Research and development expenditure credits. The Group
has complied with all the conditions attached to these grant
awards.
Included within Employee benefits costs are share based payments
for the year ended 31 December 2020 of GBP0.4m (2019: GBP0.4m).
5. Loss per share
(a) Basic
Basic loss per share is calculated by dividing the loss for the
year by the weighted average number of Ordinary Shares in issue
during the year. Potential Ordinary Shares are not treated as
dilutive as the Group is loss making and such shares would be
anti-dilutive.
Group 2020 2019
---------------------------------------------------- ----------- ------------
Loss attributable to owners of the parent (GBP) (9,056,380) (12,094,904)
Weighted average number of Ordinary Shares in issue
(number) 215,687,030 150,165,094
---------------------------------------------------- ----------- ------------
The loss per share for the year was 4p (2019: 8p).
No dividends were paid during the year (2018: GBPnil).
(b) Diluted
Potential Ordinary Shares are not treated as dilutive as the
Group is loss making and such shares would be anti-dilutive.
6. Related party transactions
The Group is owned by a number of investors, the largest being
M&G Investment Management which owns approximately 13% of the
share capital of the Company. At 31 December 2019 the largest
shareholder was IP2IPO Portfolio (GP) Limited (as general partner
for IP2IPO Portfolio LP) which owned approximately 16% of the share
capital of the Company. Accordingly there is no ultimate
controlling party.
During the year the Company had the following significant
related party transactions which were carried out at arm's length.
No guarantees were given or received for any of these
transactions:
Transactions with Directors
As part of the fundraise in December 2020 the following
Directors purchased Ordinary Shares in the Company at a cost of
GBP0.40 per share:
Number
Director of shares
----------------- ----------
John Pearson 25,000
Stephan Beringer 25,000
David Dorans 2,500
Alastair Kilgour 25,000
Bob Head 50,000
----------------- ----------
Transactions with other related parties
IP2IPO Limited - a company which shares a parent company with
IP2IPO Portfolio (GP) Limited, a major shareholder in the Group,
and which also appoints a Director of the Group charged Mirriad
Advertising plc for the following transactions during the year: (1)
GBP20,000 for the services of Dr Mark Reilly as a Director during
the year. GBP1,667 of this amount was invoiced and unpaid as at 31
December 2020. These outstanding amounts were paid on 5 February
2021; (2) GBP12,000 for the services of the Company Secretary
during the year. GBP3,000 of this amount was invoiced and unpaid as
at 31 December 2020. This outstanding amount was paid on 5 February
2021; and (3) GBP250 for travel costs related to Dr Mark Reilly.
GBP22 of this amount was invoiced and unpaid as at 31 December
2020, and was paid on 5 February 2021.
Parkwalk Advisors Limited - a company which shares a parent
company with IP2IPO Portfolio (GP) Limited, a major shareholder in
the Group, charged Mirriad Advertising plc for the following
transactions during the year: (1) GBP20,000 for the services of
Alastair Kilgour as a Director during the year. GBP1,667 of this
amount was accrued and unpaid as at 31 December 2020, but was
invoiced in early January 2021 and subsequently paid on 5 February
2021.
Top Technology Ventures Limited - a company which shares a
parent company with IP2IPO Portfolio (GP) Limited, a major
shareholder in the Group. There were no transactions with Mirriad
Advertising plc during the year (2019: GBP9,498 for attendance and
travel costs for an employee's attendance at IP Group events in
China).
All the related party transactions disclosed above were settled
by 31 December 2020 except where stated.
During the year ended 31 December 2020, the Company entered into
transactions with its subsidiary companies for working capital
purposes, which net off on consolidation - these have not been
shown above.
The Directors have authority and responsibility for planning,
directing and controlling the activities of the Group and they
therefore comprise key management personnel as defined by IAS 24
"Related party disclosures". Remuneration of Directors and senior
management is disclosed in the Remuneration Report.
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END
FR DKDBDOBKDDPD
(END) Dow Jones Newswires
May 12, 2021 02:00 ET (06:00 GMT)
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