TIDMMIRI
RNS Number : 6206V
Mirriad Advertising PLC
11 August 2022
Mirriad Advertising plc
("Mirriad" or the "Company")
Unaudited interim results
Mirriad, the leading in-content advertising company, today
announces unaudited interim results for the six months ended 30
June 2022 (the "Period" or "H1").
H1 2022 highlights:
Strategic developments
-- Improvements recorded across all non-financial KPIs on supply and demand sides
-- Growing client roster in the US, including top tier brands
and active work with all major agency groups
-- Contract signed with Magnite on 30 May 2022 to initiate path
to scale and automation of the in-content advertising format via
programmatic ad campaigns across multiple platforms, channels and
markets
-- Decision to make orderly wind down of Chinese operations by
the end of the Tencent contract in March 2023, which will deliver
annualised cost savings of approximately GBP1m
-- New Non-Executive Directors appointed in June and July 2022
-- Research shows in-content advertising increases campaign
reach compared to conventional spot advertising in March 2022
-- First campaign in Canada in February 2022
Financial headlines
-- Revenue for H1 of GBP577k (H1 2021: GBP1.1m). Due to seasonal
nature of key advertising markets and the sales pipeline, higher
revenues are expected in H2
-- US revenues grew by 57% to GBP418k (H1 2021: GBP266k), now
accounting for 72% of total revenue
-- China revenue down 85% in the Period from GBP820k in H1 2021
to GBP120k, due to stringent lockdowns and a challenging ongoing
macro environment
-- Cost control programme to deliver a total of GBP2.5m
annualised savings, with vast majority to be achieved in 2023
-- Closing cash at the end of June 2022 of GBP17.7m (30 June 2021: GBP29.8m)
-- Cash consumption increased to GBP6.7m (H1 2021: GBP5.5m) as
the Company invests in key US commercial roles and technology
-- Operating loss of GBP8.5m (H1 2021: loss of GBP5.9m)
-- Loss per share 3p (H1 2021: loss 2p)
KPIs
KPI H1 2021 H1 2022 Change
Supply side
1. Active supply partnerships 13 18 +38%
2. Supply partners represented 34 61 +79%
3. Seconds of content available 265,165 337,862 +27%
---------- ---------- ----------
Demand side No change
1. Active agency relationships 9 9 +35%
2. Number of advertisers who have run campaigns 17 23 +50%
3. Strategic and commercial partnership agreements with advertisers and agencies 2 3
---------- ---------- ----------
Stephan Beringer, CEO of Mirriad , said: "Mirriad is continuing
to build a proposition that will be a key pillar for the future of
the video and TV advertising market. Advertisers, content owners
and broadcasters all face significant challenges in their markets
and the ability to better respond to these challenges will shape
the next generation of advertising.
"Mirriad's format offers new revenue opportunities to the media
industry and high performance and returns to advertisers. Our
positive US momentum demonstrates our burgeoning opportunities in
the world's largest advertising market, with campaigns for new and
recurring advertiser clients, and a steadily growing partner
roster. Work is ongoing to further improve conversion and deal
sizes of our pipeline.
"Elsewhere, we have taken action to mitigate disappointing
revenue in China, resulting from stringent lockdowns and a
challenging macro environment overall. We expect this specific
decision will deliver annualised cost savings of approximately
GBP1m from 2023 and ensure we continue to focus on the scale that
will be achieved by integrating effectively into the wider
advertising ecosystem.
"We are tracking strongly against the KPIs and are seeing a very
clear acceleration of interest in the in-content format. As
previously guided, we expect a stronger revenue-generating activity
to be backloaded towards the end of the year, and we are within the
Company's expectations of cash consumption and cash balance."
Enquiries:
For further information please visit www.mirriad.com or
contact:
Mirriad Advertising plc
Stephan Beringer, Chief Executive Officer
David Dorans, Chief Financial Officer
Tel: +44 (0)207 884 2530
Financial Adviser, Nominated Adviser and Broker:
Panmure Gordon
Alina Vaskina / James Sinclair-Ford (Corporate Advisory)
Erik Anderson (Corporate Broking)
Tel: +44 (0)20 7886 2500
Financial Communications:
Charlotte Street Partners
Tom Gillingham Tel: +44 (0) 7741 659021
Andrew Wilson Tel: +44 (0) 7810 636995
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the company's obligations under Article 17 of MAR.
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.
Chairman's Statement
Our Interim Results underline how, despite a renewed period of
global uncertainty, strategic focus on the US can unlock long-term
future growth for Mirriad. Fully realising the potential of a
market of this size will require further effort, but our
established fundamentals mean the Company is well-placed to scale.
We are tracking strongly against the KPIs agreed by the Board and I
look forward to providing further updates on this important measure
of progress.
As outlined in the 2021 Full Year Results, we have strategically
invested to maximise our strength in the US, and I was pleased to
recently welcome new members to our expanded Board. Nicole
McCormack and JoAnna Foyle both bring high-level US-focused
experience across advertising supply and demand, while Lois Day
brings extensive fundraising and capital markets expertise. I would
also like to thank Kelsey Lynn Skinner for her contribution before
standing down from the Board for maternity reasons, and her
responsibility for Mirriad's ESG approach will pass to Lois
Day.
Hot on the heels of the business challenges born of the
pandemic, we now face another moment of global uncertainty as
inflation looks set to continue to rise for most, with inevitable
knock-on effects on consumer confidence. These conditions - now
reported across the board following inflated growth expectations
from some quarters - are already affecting ad conversion cycles
across the world.
Specifically in China, the stringent Covid-19 lockdowns in key
cities undoubtedly had more of an effect on the advertising
industry than expected, and Mirriad revenues in the first half of
2022 are considerably lower in China than anticipated. We are alive
to the varying considerations in all our markets and have taken the
decision to exit this market when our current Tencent contract ends
in Q1 2023.
Right now, we will continue to focus our spend in the areas
which will have most impact, whilst reducing and reprioritising
expenditure away from areas with less immediate revenue generating
potential.
The advertising market is changing. Global insecurities are
feeding through to advertising budget decisions, the privacy
landscape is altering and consumers are ad-fatigued. Despite this
backdrop, Mirriad delivers something different for marketers. The
results we drive both in consumer preference and brand
consideration are why we have seen key clients return to us.
There is also rising awareness of in-content as an essential and
revolutionary next-generation approach to advertising. We welcome
the fact that Amazon has turned its attention, albeit in a limited
fashion, to in-content within its own platform. While it has taken
that company three years to get to the point they are at now, it
underlines the huge potential of the format where we have extensive
experience, and strong patent protection, as the market leader.
Netflix too is considering how to diversify away from
subscription-only income with the introduction of ads in
partnership with Microsoft. These significant moves by some of the
largest players in the streaming space, combined with the need for
broadcasters and content owners/creators to find new revenue
streams, further highlight the significant $149bn Total Addressable
Market for Mirriad that exists in the 94% of content that is
currently out of reach of traditional ad formats.
We will continue our hard work to convert what is a promising
and high-quality pipeline, whilst further raising awareness of how
our category-leading approach to in-content advertising can make a
crucial difference to brands, content creators and
broadcasters.
John Pearson
Non-executive Chairman
11 August 2022
Chief Executive Officer's Statement
Since our 2021 Final Results announcement in May 2022, we have
continued to execute against our strategy of adoption and
integration of Mirriad 's technology with several important
developments. The new collaboration with Magnite is one of the many
steps towards our ability to activate in-content insertions
programmatically, integrating with the media and content ecosystem
based on a standardised approach.
The new developments come at a time when we are experiencing a
significant rise of interest in the in-content format, evidenced by
Amazon's recent announcement to enter the market. We see Amazon's
move as a pivotal validation of the new ad category that Mirriad is
leading, and we are confident that our platform and our established
roster of quality partnerships put us in a very strong
position.
We are currently performing well against the KPIs the Company
agreed to report against, underlining progress in all key areas
across both the supply and demand sides of the business.
Revenue in the US continues to grow and has increased by 57%
year-on-year, however overall H1 revenue for the Company is
GBP577k, approximately half of the previous year's H1 revenue. The
main cause of this decline is the significant reduction from China
where revenues have fallen by over 85% year-on-year, as the H1 2021
comparator included the final recognition of minimum guaranteed
revenue in the first Tencent contract.
The severe impact of Covid restrictions in China have led to
unprecedented cuts and lingering uncertainty across the entire
advertising market in China, which is combined with a c hallenging
ongoing macro environment. We have therefore taken the strategic
decision to wind down our operations in China at the end of our
current contract which ends on 31 March 2023.
We expect this decision will deliver annualised cost savings of
around GBP1m from 2023, allowing more immediate focus in the
company's other markets and especially in the US, where we're
experiencing the most encouraging developments both on the
supply-partner side and with advertisers and their agencies.
It has become apparent this year that audience attention and ad
relevance are quickly rising as the headline themes for the
advertising and content industry, who are facing the ever-growing
ad escapism as a threat to everyone's growth agendas. In this
context, I firmly believe that content owners and advertisers will
now begin prioritising format diversification to drive higher
campaign ROIs whilst countering the growing ad-aversion. The gains
in reach and impact that Mirriad's in-content approach can deliver,
as extensively proven by Nielsen, BARB and Kantar, offer a decisive
new option at a time of recalibration for the advertising
industry.
Campaigns update
In North America, we successfully deployed dynamic ad insertion
with a leading global food and drink manufacturer, and we have
undertaken several significant campaigns for Lexus, driving a 14%
uptick in headline brand awareness. Alongside this, we worked with
Nissan to promote its current line of electric vehicles (EVs), via
a Mirriad-first SVOD integration on a popular streaming
platform.
Four further high-profile North American campaigns for blue chip
advertisers have been approved and are expected to run imminently.
Each benefit from the growing scale of our inventory and our
platform's ability to deliver campaigns across platforms and
formats with contextual precision to secure higher impact.
We have executed several music campaigns during H1, most notably
an event marking the 50th birthday of deceased artist Biggie
Smalls. This was a highly anticipated event where Mirriad's
solution enabled brands to be digitally integrated into this iconic
celebration that included a procession through Manhattan with a
star-studded entourage.
Agreements in other markets that we announced earlier in the
year have started to bear the fruit of first campaigns. In Japan,
we went live on the FujiTV VOD platform. We expect to roll out
further campaigns across FujiTV's VOD platform and broadcast
television network this Autumn. In Canada we launched with Bell
Media in Q1 running campaigns for blue-chip clients in the
Financial Services and FMCG sectors. These initial campaigns are
the first to run in the Canadian market and have delivered
impressive results for our content and brand partners. We expect a
continued roll out to new partners in Canada in H2.
Pipeline and partners update
In the US, we are seeing growth in revenue, partners and
clients, but Europe and APAC are lagging behind progress achieved
in H1, the latter primarily due to stringent Covid-19 lockdowns in
China.
We are encouraged, however, by the volume of repeat customers,
the presence of high-quality brands across all categories and the
overall strength of our forward-looking pipeline. Notably, we are
currently responding to RFPs for blue-chip brands across all key
categories and working with all major advertising agency groups in
the US. Following the hires of Zac Reeder as Head of Studio
Partnerships, in Los Angeles and Matt Douglas as Head of
Programmatic Partnerships, in New York we are seeing an immediate
uptick of opportunities in both of these growth areas.
To maximise the realisation of this pipeline we will now be
leaning more into digital, in the EU and APAC, to reflect positive
initial progress made on this front in North America.
We are focused on using our vast array of agreements and
partnerships to drive the delivery of more campaigns, but we do
expect a lot of this activity to be backloaded towards the end of
the year, as per industry norms.
Technology and effectiveness update
We are working to build a standardised proposition that will be
a key pillar for the future of the video and TV advertising
industry. At a time of increasing interest in in-content, we must
judiciously communicate key technical capabilities to avoid giving
away competitive advantage. Mirriad currently enjoys the protection
of 35 patents, and we will add to these to ensure we have robust
safeguards as our technology progresses even further.
We continue to make positive progress on developing our dynamic
insertion approach,
and we are continuously improving our end-to-end experience,
enhancing data exchange, and developing self-service
capabilities.
Outlook
Across the business, the team is working hard to successfully
convert and further grow our pipeline, against the backdrop of
macroeconomic uncertainty in many of our markets. As evidenced by
our KPIs, there is positive progress on building both the supply
and demand sides of our pipeline.
Revenue for H1 was not where we would have liked it to have
been, but Company plans always assumed a lot of revenue-generating
activity to be backloaded towards the end of the year.
The Company has a cash balance of GBP17.7m and we are actively
reviewing and prioritising spend to ensure that we manage our cash
use over the second half of the year, factoring in planned-for cost
increases in line with strategic hires. We have taken decisive
action to address currently inescapable market challenges in China,
and at the end of the half year we are within the company's
expectations of cash consumption and cash balance.
Crucially, the calibre of discussions we are having with
top-tier content and technology partners, advertisers and agencies,
underlines how Mirriad is moving from being a novel solution to be
an accepted part of the advertising ecosystem. This is still an
ongoing process, and further enabling the integration process will
be our number one focus for the next twelve months.
Stephan Beringer
Chief Executive
11 August 2022
Chief Financial Officer's Statement
Interim results
In H1 2022, revenues reduced year on year following a material
reduction in revenues from our Chinese business. The comparator
period in 2021 saw the final recognition and unwinding of minimum
guaranteed revenues under the first Tencent contract with no
equivalent in 2022. We had anticipated much higher Chinese revenues
but the complete close down of many Chinese cities including
Shanghai was not expected. Revenue for the Period was GBP577k (H1
2021: GBP1.1m). US revenues grew by 57% to GBP418k (H1 2021:
GBP266k), which was encouraging but not sufficient to offset the
substantial reduction in China. US revenues accounted for 72% of
overall revenue up from 23% in the same period last year.
In Europe, we saw a relatively modest level of activity and
European revenues were not material in either H1 2022 or 2021.
Gross profit for the Period decreased by 56% to GBP430k (H1
2021: GBP978k) as a result of the reduction in revenue. Cost of
sales decreased by 8% period on period to GBP147k (H1 2021:
GBP160k). As previously stated, cost of sales is principally
expenditure on staff and the Company has staffed for peaks of
activity. We anticipate gross margin will continue to increase as
the volume of activity increases.
The Group's operating loss increased by 42% to GBP8.5m (H1 2021:
GBP5.9m) as a result of the reduction in sales and an increase in
Administrative expenses following the continued investment in our
US team and continued investment in our technology function.
Administrative expenses increased by 27% to GBP8.9m (H1 2021:
GBP7.0m). Headcount at 30 June 2022 was 142 (30 June 2021:
109).
At the half year end, we have again reviewed our compliance with
IAS 38 and we continue to believe that the inherent uncertainty of
future revenue generation means that it is not appropriate to
capitalise any of our development cost in the first six months of
the year.
The Group continues to prioritise expenditure on research and
development to ensure that it retains its technological lead and
addresses partner needs. For the period ending June 2022 total
expenditure on research and development increased by 19% to GBP1.8m
(H1 2021: GBP1.5m).
The loss for the period before tax also increased by 42% to
GBP8.4m (H1 2021: GBP5.9m) in line with the increase in operating
loss noted above.
Tax
The Group has not recognised any tax assets in respect of
trading losses arising in the current financial period or
accumulated losses in previous financial years. The tax credit
recognised in the current and previous period arises from the
receipt of R&D tax credits in the UK. The amount receivable for
the Period ended 30 June 2022 is GBP293k (H1 2019: GBP31k) as the
Company has reviewed its current and historic R&D tax
credits.
Earnings per share
The company recorded a loss of 3 pence per share (H1 2021: loss
of 2 pence per share). This calculation is based on the weighted
average number of shares in issue during the period.
Dividend
No dividend has been proposed for the Period ended 30 June 2022
(H1 2021: GBPnil).
Cash flow
Net cash used in operations (defined as the sum of net cash used
in operating activities and the net cash used in investing
activities) during the Period increased in line with the increase
in operating loss by 22% to GBP6.7m (H1 2021: GBP5.5m). During the
period no development costs were capitalised (H1 2021: GBPnil). The
Group also incurred GBP42k (H1 2021: GBP55k) of capital expenditure
on tangible assets.
No Ordinary Shares were issued in the Period (H1 2021:
188,917).
Balance sheet
The Group has a debt-free balance sheet. Net assets decreased by
40% to GBP17.9m (30 June 2021: GBP29.8m) as the Company used cash
balances to fund the Group's ongoing operations. Cash and cash
equivalents at 30 June 2022 were GBP17.7m (30 June 2021:
GBP29.8m).
Accounting policies
On 31 December 2020, IFRS as adopted by the European Union at
that date was brought into UK law and became UK-adopted
international accounting standards, with future changes being
subject to endorsement by the UK Endorsement Board. Mirriad
Advertising Plc transitioned to UK-adopted international accounting
standards in its consolidated financial statements on 1 January
2021. There was no impact and no changes in accounting policies
resulting from the transition. These condensed consolidated interim
financial statements for the half-year reporting period ended 30
June 2022 have been prepared in accordance with the UK-adopted
International Accounting Standard (IAS) 34, 'Interim Financial
Reporting'.
David Dorans
Chief Financial Officer
11 August 2022
Company Information
Directors Independent Auditors
John Pearson PricewaterhouseCoopers LLP
Chairman 7 More London Riverside
Stephan Beringer London
Chief Executive Officer SE1 2RT
David Dorans
Chief Financial Officer Solicitors
Alastair Kilgour Osborne Clarke LLP
Non-Executive Director 6th Floor
Lois Day One London Wall
Non-Executive Director London
Bob Head EC2Y 5EB
Non-Executive Director
Nicole McCormack
Non-Executive Director
JoAnna Foyle
Non-Executive Director
Company registration number Company Secretary
09550311 Jamie Allen
-----------------------------------
Registered Office Nominated Adviser & Broker
6(th) Floor Panmure Gordon (UK) Limited
One London Wall One New Change
London London
EC2Y 5EB EC4M 9AF
-----------------------------------
Company website Financial PR
www.mirriad.com Charlotte Street Partners Limited
16 Alva Street
Edinburgh
EH2 4QG
-----------------------------------
Registrars
Computershare Investor Services
plc
The Pavilions
Bridgwater Road
Bristol
BS99 6ZZ
-----------------------------------
Condensed consolidated statement of profit or loss and condensed
statement of comprehensive income for the six months ended 30 June
2022
Year ended
31 December
Six months Six months 2021
ended 30 June ended 30 June
2022 2021
(unaudited) (unaudited) (audited)
Note GBP GBP GBP
--------------- --------------- --------------
Revenue 5 577,436 1,137,288 2,009,721
Cost of Sales (147,154) (159,614) (293,627)
-------------------------- ------- --------------- --------------- --------------
Gross Profit 430,282 977,674 1,716,094
-------------------------- ------- --------------- --------------- --------------
Administrative expenses (8,880,678) (7,006,277) (13,936,458)
Other operating Income - 85,217 200,982
-------------------------- ------- --------------- --------------- --------------
Operating Loss (8,450,396) (5,943,386) (12,019,382)
-------------------------- ------- --------------- --------------- --------------
Finance Income 23,093 4,288 9,907
Finance costs (18,622) (3,275) (10,768)
-------------------------- ------- --------------- --------------- --------------
Finance income / (costs)
net 4,471 1,013 (861)
Loss before income tax (8,445,925) (5,942,373) (12,020,243)
Income tax credit 293,300 30,949 1,047,771
-------------------------- ------- --------------- --------------- --------------
Loss for the period /
year (8,152,625) (5,911,424) (10,972,472)
-------------------------- ------- --------------- --------------- --------------
Loss per ordinary share - basic
6 (3p) (2p) (4p)
----------------------------------- --------------- --------------- --------------
All activities are classified as continuing.
Year ended
31 December
Six months Six months
ended 30 June ended 30 June
2022 2021 2021
(unaudited) (unaudited) (audited)
GBP GBP GBP
--------------- --------------- --------------
Loss for the financial period
/ year (8,152,625) (5,911,424) (10,972,472)
------------------------------------------ --------------- --------------- --------------
Other comprehensive income
/ (loss)
Items that may be reclassified
to profit or loss:
Exchange differences on translation
of foreign operations 276,856 25,992 (216,756)
------------------------------------------ --------------- --------------- --------------
Total comprehensive loss for
the period / year (7,875,769) (5,885,432) (11,189,228)
------------------------------------------ --------------- --------------- --------------
Condensed consolidated balance sheet
At 30 June 2022
As at 31
December
As at 30 As at 30
June 20 22 June 2021 2021
(unaudited) (unaudited) (audited)
Note GBP GBP GBP
----------------------------- ----------- -------------- ---------------- ---------------
Assets
Non-current assets:
Property, plant and
equipment 704,104 470,361 767,396
Trade and other receivables 188,795 185,885 162,962
892,899 656,246 930,358
Current assets
Trade and other receivables 1,307,677 1,738,492 1,892,152
Other current assets 1,135,286 110,293 1,116,320
Cash and cash equivalents 17,714,189 29,764,102 24,501,214
----------------------------- ----------- -------------- ---------------- ---------------
20,157,152 31,612,887 27,509,686
----------------------------- ----------- -------------- ---------------- ---------------
Total assets 21,050,051 32,269,133 28,440,044
----------------------------- ----------- -------------- ---------------- ---------------
Liabilities
Non-current liabilities
Lease liabilities 357,912 29,636 411,993
----------------------------- ----------- -------------- ---------------- ---------------
357,912 29,636 411,993
----------------------------- ----------- -------------- ---------------- ---------------
Current liabilities
Trade and other payables 2,419,427 2,124,607 2,866,773
Current tax liabilities - - 2,481
Lease liabilities 345,196 361,132 217,825
----------------------------- ----------- -------------- ---------------- ---------------
2,764,623 2,485,739 3,087,079
----------------------------- ----------- -------------- ---------------- ---------------
Total liabilities 3,122,535 2,515,375 3,499,072
----------------------------- ----------- -------------- ---------------- ---------------
Net Assets 17,927,516 29,753,758 24,940,972
----------------------------- ----------- -------------- ---------------- ---------------
Equity and Liabilities
Equity attributable
to owners of the parent
Share capital 7 52,690 52,690 52,690
Share premium 65,754,666 65,754,666 65,754,666
Share based payment
reserve 4,527,838 3,174,515 3,665,525
( 83,198 ( 117,306 ( 360,054
Retranslation reserve ) ) )
( 52,324,480 ( 39,110,807 ( 44,171,855
A ccumulated losses ) ) )
----------------------------- ----------- -------------- ---------------- ---------------
Total equity 17,927,516 29,753,758 24,940,972
----------------------------- ----------- -------------- ---------------- ---------------
Condensed consolidated statement of changes in equity
For the six months ended 30 June 2022
Six months ended 30 June 2021
--------------------------------------------------------------------------------------------
Share
Share Share based payment Retranslation Accumulated Total
Capital Premium reserve reserve Losses Equity
Note GBP GBP GBP GBP GBP GBP
------------------- ------- --------- ----------- -------------- -------------- ------------- -------------
Balance as at
1 January 2021 52,688 65,710,297 2,850,571 (143,298) (33,199,383) 35,270,875
------------------- ------- --------- ----------- -------------- -------------- ------------- -------------
Loss for the
period - - - - (5,911,424) (5,911,424)
Other
comprehensive
income for the
period - - - 25,992 - 25,992
------------------- ------- --------- ----------- -------------- -------------- ------------- -------------
Total
comprehensive
loss for the
period - - - 25,992 (5,911,424) (5,885,432)
------------------- ------- --------- ----------- -------------- -------------- ------------- -------------
Proceeds from
shares issued 2 44,369 - - - 44,371
Share based
payments
recognised as
expense - - 323,944 - - 323,944
------------------- ------- --------- ----------- -------------- -------------- ------------- -------------
Total transactions
with shareholders
recognised directly
in equity 2 44,369 323,944 - - 368,315
---------------------------- --------- ----------- -------------- -------------- ------------- -------------
Balance as
at 30 June 2021 52,690 65,754,666 3,174,515 (117,306) (39,110,807) 29,753,758
---------------------------- --------- ----------- -------------- -------------- ------------- -------------
Year ended 31 December 2021 (audited)
-----------------------------------------------------------------------------------
Share based
Share Share payment Retranslation Accumulated Total
Capital Premium reserve reserve Losses Equity
GBP GBP GBP GBP GBP GBP
----------------------- --- --------- ----------- ------------ -------------- ------------- --------------
Balance at 1
January 2021 52,688 65,710,297 2,850,571 (143,298) (33,199,383) 35,270,875
Loss for the
financial year - - - - (10,972,472) (10,972,472)
Other comprehensive
loss for the
year - - - (216,756) - (216,756)
----------------------- --- --------- ----------- ------------ -------------- ------------- --------------
Total comprehensive
loss for the
year - - - (216,756) (10,972,472) (11,189,228)
----------------------- --- --------- ----------- ------------ -------------- ------------- --------------
Proceeds from
shares issued 2 44,369 - - - 44,371
Share based payments
recognised as
expense - - 814,954 - - 814,954
----------------------- --- --------- ----------- ------------ -------------- ------------- --------------
Total transactions
with shareholders
recognised directly
in equity 2 44,369 814,954 - - 859,325
---------------------------- --------- ----------- ------------ -------------- ------------- --------------
Balance as
at 31 December
2021 52,690 65,754,666 3,665,525 (360,054) (44,171,855) 24,940,972
---------------------------- --------- ----------- ------------ -------------- ------------- --------------
Six months ended 30 June 2022
-----------------------------------------------------------------------------------------
Share
based
Share Share payment Retranslation Accumulated Total
Capital Premium reserve reserve Losses Equity
Note GBP GBP GBP GBP GBP GBP
------------------------ ------- --------- ----------- ---------- ---------------- ------------- ------------
Balance as at
1 January 2022 52,690 65,754,666 3,665,525 (360,054) (44,171,855) 24,940,972
------------------------ ------- --------- ----------- ---------- ---------------- ------------- ------------
Loss for the
period - - - - (8,152,625) (8,152,625)
Other comprehensive
income for the
period - - - 276,856 - 276,856
------------------------ ------- --------- ----------- ---------- ---------------- ------------- ------------
Total comprehensive
loss for the
period - - - 276,856 (8,152,625) (7,875,769)
------------------------ ------- --------- ----------- ---------- ---------------- ------------- ------------
Share based payments
recognised as
expense - - 862,313 - - 862,313
------------------------ ------- --------- ----------- -------------- ------------ ------------- ------------
Total transactions
with shareholders
recognised directly
in equity - - 862,313 - - 862,313
--------------------------------- --------- ----------- -------------- ------------ ------------- ------------
Balance as
at 30 June 2022 52,690 65,754,666 4,527,838 (83,198) (52,324,480) 17,927,516
--------------------------------- --------- ----------- -------------- ------------ ------------- ------------
Condensed consolidated statement of cash flows for the six months ended
30 June 2022
Note Year ended
31 December
Six months Six months 2021
ended 30 ended 30
June 2022 June 2021
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------ ------ -------------- -------------- --------------
Cash flow used in operating
activities 8 (6,941,442) (5,430,798) (10,450,796)
Tax credit received 274,335 - 72,993
Taxation paid (14,291) (26,261) (46,928)
Interest received 23,093 4,288 9,907
Lease interest paid (18,622) (3,275) (10,768)
------------------------------ ------ -------------- -------------- --------------
Net cash used in operating
activities (6,676,927) (5,456,046) (10,425,592)
------------------------------ ------ -------------- -------------- --------------
Cash flow from investing
activities
Purchase of tangible assets (42,462) (55,133) (159,250)
Proceeds from disposal - - -
of tangible assets
------------------------------ ------ -------------- -------------- --------------
Net cash used in investing
activities (42,462) (55,133) (159,250)
------------------------------ ------ -------------- -------------- --------------
Cash flow from financing
activities
Proceeds from issue of
ordinary share capital
(net of costs of issue) - 44,371 44,371
Payment of lease liabilities (67,636) (190,486) (379,711)
------------------------------ ------ -------------- -------------- --------------
Net cash used in financing
activities (67,636) (146,115) (335,340)
------------------------------ ------ -------------- -------------- --------------
Net decrease in cash and
cash equivalents (6,787,025) (5,657,294) (10,920,182)
Cash and cash equivalents
at the beginning of the
period / year 24,501,214 35,421,396 35,421,396
Cash and cash equivalents
at the end of the period
/ year 17,714,189 29,764,102 24,501,214
------------------------------ ------ -------------- -------------- --------------
Cash and cash equivalents
consists of
Cash at bank and in hand 17,714,189 29,764,102 24,501,214
Cash and cash equivalents 17,714,189 29,764,102 24,501,214
----------------------------------------- ----------- --------------- -------------
1 Basis of preparation
These condensed consolidated interim financial statements for
the half-year reporting period ended 30 June 2022 have been
prepared in accordance with the UK-adopted International Accounting
Standard (IAS) 34, 'Interim Financial Reporting'.
The interim report does not include all of the notes of the type
normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the
year ended 31 December 2021, which has been prepared in accordance
with UK-adopted International Financial Reporting Standards
("IFRS") and IFRS Interpretation Committee ("IFRS IC")
Interpretations in conformity with the requirements of the
Companies Act 2006 applicable to companies reporting under those
standards.
These condensed interim consolidated financial statements for
the six months ended 30 June 2022 and for the six months ended 30
June 2021 do not constitute statutory accounts as defined in
Section 434 of the Companies Act and are unaudited. The financial
information for the six months ended 30 June 2022 presents
financial information for the consolidated Group, including the
financial results of the Company's wholly owned subsidiaries
Mirriad Advertising Private Limited, Mirriad Inc, Mirriad Software
Science and Technology (Shanghai) Co. Ltd, and Mirriad Limited
(dormant). Comparative figures in the condensed interim financial
statements for the year ending 31 December 2021 have been taken
from the Group's audited financial statements on which the Group's
auditors, Pricewaterhouse Coopers LLP, expressed an unqualified
opinion.
The Board approved these interim financial statements on 11
August 2022.
1.1 Going concern
These condensed interim financial statements have been prepared
on the going concern basis, notwithstanding the Group having made a
loss for the period of GBP8.15 million (June 2021: GBP5.91
million). The going concern basis assumes that the Group and
Company will have sufficient funds available to continue to trade
for the foreseeable future and not less than 12 months from the end
of the financial period being reported.
The Directors have prepared financial forecasts including cash
flow forecasts for the period until 31 December 2024 for the Group
and the Company and these indicate that based on raising additional
funding, they will have sufficient funds available to meet their
debts and liabilities as they fall due. The base case forecast
indicates that the Group and Company will require additional funds
within 13 months of the date of approval of these condensed interim
financial statements. Although the Directors believe it is unlikely
that the Group and Company will require additional funds within 12
months of the date of approval of these condensed interim financial
statements, in a more severe but possible downside scenario should
there be unexpected incremental costs there is a risk that the
Group and Company may require funds within the next 12 months. The
Directors have the ability to control costs and mitigate the impact
of any increase in costs, which principally relate to staff, by
slowing expected hiring or flexing staff numbers. The Directors
have previously raised funds in 2019 and 2020 and are confident
that additional funding can be raised most likely through new
equity, debt or customer contracts. As at the date of approval of
these condensed interim financial statements this is not
committed.
As such these conditions indicate the existence of a material
uncertainty that may cast significant doubt on the Group and
Company's ability to continue as a going concern. These condensed
interim financial statements do not include the adjustments that
would arise if the Group or Company were unable to continue as a
going concern.
2 Accounting Policies
The accounting policies applied are consistent with those of the
annual report and accounts for the year ended 31 December 2021, as
described in those financial statements other than standards,
amendments and interpretations which became effective after 1
January 2022 and were adopted by the Group. These have had no
significant impact on the Group's loss for the period or
equity.
Seasonality of Operations
Due to the seasonal nature of the US and UK advertising markets
higher revenues are usually expected in the second half of the year
than the first six months. In the financial year ended 31 December
2021, 30% of US revenues accumulated in the first half of the year,
with 70% accumulating in the second half. For the UK Company 35% of
revenues accumulated in the first half of 2021 and 65% in the
second half.
There are no items affecting assets, liabilities, equity, net
income or cash flows that are unusual because of their nature, size
or incidence which are required to be disclosed under IAS 34 para
16A(c).
There are no events after the interim reporting period which are
required to be reported under IAS 34 para 16A(h).
There are no financial instruments being measured at fair value
which require disclosure under IAS 34 para 16A(j)
3 Group financial risk factors
The condensed interim financial statements do not contain all
financial risk management information and disclosures required in
annual financial statements; the information should be read in
conjunction with the financial information, as at 31 December 2021,
summarized in the 2021 annual report and accounts. There have been
no significant changes in any risk management policies since 31
December 2021.
4 Critical accounting estimates and judgements
The preparation of interim financial statements requires
management to make judgements, estimates and assumptions that
affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expense. Actual
results might differ from these estimates. IAS34(16A)(d) In
preparing these condensed interim financial statements, the
significant judgements made by management in applying the Group's
accounting policies and the key sources of estimation uncertainty
were the same as those that applied to the consolidated financial
statements for the year ended 31 December 2021.
There are no changes in estimates of amounts reported in prior
financial years.
5 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 revenue is classified by
where the sales were booked not by the geographic location of the
customer.
In the current reporting period there is no income outside of
the primary business activity. In the prior year there was income
received from grants which was recognised in other operating
income.
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the steering committee that makes
strategic decisions. The steering committee is made up of the Board
of Directors. There are no sales between segments. The revenue from
external parties reported to the strategic steering committee is
measured in a manner consistent with that in the income
statement.
The Parent company is domiciled in the United Kingdom. The
amount of revenue from external customers by location of the Group
billing entity is shown in the tables below.
Revenue
Year ended
Six months Six months 31 December
ended ended
30 June 30 June 2021
2022 2021
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------- -------------- -------------- --------------
Turnover by geography
USA 418,035 266,440 884,248
China 119,747 819,727 981,164
UK 39,654 51,121 144,309
Total 577,436 1,137,288 2,009,721
----------------------- -------------- -------------- --------------
Loss before tax
The EBITDA is the loss for the year before depreciation,
amortisation, interest and tax. The loss before tax is broken down
by segment as follows:
Year ended
Six months Six months 31 December
ended ended
30 June 30 June 2021
2022 2021
(unaudited) (unaudited) (audited)
GBP GBP GBP
-------------------------- -------------- -------------- --------------
UK (7,436,070) (4,886,554) (11,108,631)
USA (129,500) (946,497) ( 19,812 )
India (321,693) (301,783) (572,662)
China (312,332) 412,293 122,113
Total EBITDA (8,199,595) (5,722,541) (11,578,992)
( 440,390
Depreciation (250,801) (220,845) )
Finance income / (costs)
net 4,471 1,013 (861)
-------------------------- -------------- -------------- --------------
Loss before tax (8,445,925) (5,942,373) (12,020,243)
-------------------------- -------------- -------------- --------------
6 Loss per share
(a) Basic
Basic loss per share is calculated by dividing the loss for the
period / year by the weighted average number of ordinary shares in
issue during the period / year. Potential ordinary shares are not
treated as dilutive as the Group is loss making and such shares
would be anti-dilutive.
Group Six months Six months
ended ended Year ended
30 June 30 June 31 December
2022 2021 2021
---------------------------------- ------------ ------------ -------------
Loss attributable to owners
of the parent (GBP) (8,152,625) (5,911,424) (10,972,472)
---------------------------------- ------------ ------------ -------------
Weighted average number of
ordinary shares in issue Number 279,180,808 279,001,638 279,091,959
---------------------------------- ------------ ------------ -------------
The loss per share for the period was 3p (six months to 30 June
2021: 2p; year ended 31 December 2021: 4p).
No dividends were paid during the period (six months to 30 June
2021: GBPnil; year ended 31 December 2021: GBPnil).
(b) Diluted
Potential ordinary shares are not treated as dilutive as the
Group is loss making and such shares would be anti-dilutive
7 Share capital
Ordinary shares of GBP0.00001 each
Allotted and fully paid Number
-------------------------- ------------
At 1 January 2022 279,180,808
Issued during the period -
At 30 June 2022 279,180,808
--------------------------- ------------
No Ordinary Shares were issued during the period.
8 Net cash flows used in operating activities
Year ended
Six months Six months
ended ended 31 December
30 June
30 June 2022 2021 2021
(unaudited) (unaudited) (audited)
GBP GBP GBP
-------------------------------------- ---- --------------- -------------- --------------
Loss for the financial period
/ year (8,152,625) (5,911,424) (10,972,472)
Adjustments for:
Tax on loss on ordinary activities (293,300) (30,949) (1,047,771)
Interest income (23,093) (4,288) (9,907)
Lease interest costs 18,622 3,275 10,768
Operating loss: (8,450,396) (5,943,386) (12,019,382)
Amortisation of right-of-use
assets 163,550 158,986 299,931
Depreciation of tangible assets 87,251 61,859 140,459
Bad debts (reversed) / written
off (3,732) (524) 1,309
Share based payment charge 862,313 323,944 814,954
Adjustment to tax credit in
respect of previous periods - - (13,628)
Research and development expenditure
credits - (6,351) (27,066)
Foreign exchange variance 276,857 25,992 (216,756)
- Decrease / (increase) in
debtors 562,374 (262,047) (372,221)
- (Decrease) / increase in
creditors (439,659) 210,729 941,604
-------------------------------------------- --------------- -------------- --------------
Cash flow used in operating
activities (6,941,442) (5,430,798) (10,450,796)
-------------------------------------------- --------------- -------------- --------------
9 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. Accordingly there is no ultimate
controlling party.
During the period the Company had the following related party
transactions. No guarantees were given or received for any of these
transactions.
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 period:
(1) GBP10,000 for the services of Kelsey Lynn Skinner as a Director
from 1 January 2022 until 23 June 2022. Of this amount GBP1,667 was
invoiced and unpaid as at 30 June 2022. (2) GBP3,000 for the
services of the Company Secretary for the period from 1 January
2022 until 31 March 2022.
Parkwalk Advisors 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
period: (1) GBP10,000 for the services of Alastair Kilgour as a
Director during the period. GBP1,667 of this amount was accrued and
unpaid as at 30 June 2022.
All the related party transactions disclosed above were settled
by 30 June 2022 except where stated.
10 Availability of Interim Report
Electronic copies of this interim financial report will be
available on the Company's website at
www.mirriadplc.com/investor-relations .
S
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.
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END
IR QBLFFLVLBBBZ
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