Monitise PLC MONI Trading update

  Monitise PLC (MONI) - Trading update

RNS Number : 7897H
Monitise PLC
17 July 2012
 



17 July, 2012      
                                                                                               

                                       

                                 Monitise plc

                                       

                                Trading update

                                       

              Revenues more than double for third successive year

                                       

      Acquisition of Clairmail creates global powerhouse in Mobile Money

                                       

           2012/13 revenues expected to be in the region of $110m^ 

                                       

Monitise plc (LSE:  MONI.L), the  technology and  services company  delivering 
mobile  banking,  payments  and  commerce  networks  worldwide,  announces  an 
unaudited trading  update  following  its 30  June  2012  financial  year-end. 
Monitise's 2012 full-year results are scheduled to be published on 4 September
2012.

 

Highlights

 

·   Full-year 2012 revenues are expected to be approximately $53m (£34m) ^(1),
nearly two and a half times the $22m (£14m) reported last year, making it  the 
third successive  year that  revenue has  more than  doubled compared  to  the 
previous year.

 

·    Profitability  in   live  operations  continues   to  show  very   strong 
year-on-year growth.

 

·   Gross  margins for  the year  are expected  to be  in the  region of  66%, 
compared with 62% last year, and on track  to hit more than 70% by the  second 
half of 2012/13.

 

·   Demand for  the Monitise Enterprise  Platform is at  an all-time high  and 
investment in the platform and its global reach continues in line with  market 
demand.

 

·   Total Monitise registered customers are approaching 16m, three and a  half 
times the level seen at the time of Monitise's full-year results in  September 
2011. The  group  is  attracting  well over  half  a  million  new  registered 
customers per month.

 

·   The  acquisition  of  Clairmail  at  the  end  of  June  further  enhances 
Monitise's position as the  global leader in the  fast expanding Mobile  Money 
market.

 

-      The order book of the combined Group at the end of June 2012, comprised
of more  than  $170m  committed  minimum  orders,  plus  a  further  $250m  of 
additional revenues expected  from existing  contractual arrangements,  making 
more than $420m (£270m) in total.

 

-      Around $75m (£48m) of this order  cover is expected to flow through  to 
revenues in 2012/13.

 

-      Total Group revenues  in 2012/13 are  expected to be  in the region  of 
$110m (£70m).

 

-      The Group remains on track for EBITDA break-even by December 2013.

 

-      Monitise  now provides  Mobile  Money services  to over  300  financial 
institutions  and  partners,  including  a  third  of  the  top  50  financial 
institutions and of these eight of the top 13 in North America.

 

-      Combined business  handles over  a billion transactions  per annum,  as 
well as payments  and transfers  worth $15bn  on a  current weekly  annualised 
basis.

 

-      For 2011/12 it is expected that a move to equity accounting ^(2)   will 
result in a $3m (£2m) increase in reported full-year revenues to approximately
$56m (£36m).

 

^(1) Foreign exchange rate for Sterling/US  Dollar used in the trading  update 
is $1.56

^(2) See separate section on Accounting for Joint Ventures

 

 

Global Growth

 

Monitise's worldwide trading momentum, new business wins and launches continue
to expand around the globe:

 

·   New multi-year  bank contracts have  been entered with  HSBC, RBS and  The 
Co-operative Bank. Monitise entered a strategic five-year agreement with  FIS, 
the  world's  largest  global  provider  dedicated  to  banking  and  payments 
technologies, following Monitise Group's  buyout of its  US Joint Venture.  In 
India, Movida, a Monitise joint venture  with Visa Inc., entered an  agreement 
with HDFC  Bank, India's  second-largest private  bank, to  launch new  mobile 
payments services.

 

·   Visa Inc.,  the world's  largest retail electronics  payments network,  in 
collaboration  with  Monitise  launched  mobile  services  via  Visa's   Debit 
Processing System allowing US financial institutions to offer their debit  and 
prepaid account holders the ability  to monitor account history and  balances, 
transfer funds between accounts, and receive near real time transaction alerts
on their mobile devices.

 

·   Visa  Europe, which  is owned  and operated  by more  than 3,700  European 
member  banks,  delivered  the  first  pan-European  mobile   person-to-person 
payments and alerts service developed in partnership with Monitise.  

 

·   Monitise  Joint  Venture  Mobile Money  Network  launched  instant  mobile 
checkout, Simply Tap, and is  working with a large  number of retailers as  it 
rolls out new mobile commerce services. The  JV has been first to market  with 
cutting-edge technology  including  image  recognition  and  transactional  QR 
codes.

 

·   PT AGIT Monitise Indonesia, a joint venture between Monitise Asia  Pacific 
and Astra Graphia,  successfully completed  work on  their Jakarta‐based  data 
centre to support the full spectrum  of mobile banking, payments and  commerce 
ahead of new launches over the coming quarters.

 

Monitise Group CEO Alastair Lukies said:

 

"The Mobile Money  landscape continues to  grow at an  astonishing rate. As  a 
major global force in Mobile Money, Monitise remains positioned at the  centre 
of this  huge ecosystem  with its  platform, skills  and partnerships  driving 
another year of  phenomenal growth. Our  clear and unwavering  strategy is  to 
provide our  white-labeled, cloud-based  Monitise Enterprise  Platform to  the 
world's leading financial  institutions and payments  companies, helping  them 
retain their  rightful role  as  the consumer  custodian in  mobile  financial 
services."

 

Monitise Group Chairman Duncan McIntyre added:

 

"Once again the Monitise team has achieved substantial growth in the financial
year 2012 and  proven the global  demand for a  truly bank-grade Mobile  Money 
platform. We believe we have both the leading platform and market position  so 
as the landscape continues to evolve and accelerate we must continue to invest
to optimise shareholder value."

 

Accounting for Joint Ventures

 

To date the  Group's interests in  Joint Ventures have  been accounted for  by 
proportionate consolidation, primarily as the initial revenues were  generated 
through the UK JV with Monilink. As  a result, the Group's share of each  JV's 
revenue, costs, assets and liabilities have been included line by line in  the 
Group's financial statements.

 

As the Group has evolved, the JVs have matured as entities, and the  Directors 
believe that it  is now  more appropriate to  account for  the joint  ventures 
under equity accounting.   This  has the effect of  combining all the  Group's 
shares in  JVs  financials in  one  line in  the  income statement  (Share  of 
Associates and JVs), which is reported below EBITDA and Operating Profit,  and 
one line in the Balance Sheet.  At  the same time, a new accounting  standard, 
IFRS 11, has  been released  which disallows proportionate  accounting and  is 
anticipated to become effective for Monitise from 2014/15.

 

Therefore the Group accounts will be  prepared on the equity accounting  basis 
for 2011/12. The key financials on a proportionate accounting basis will  also 
be shown as a memorandum.

 

For 2011/12 it is expected that the move to equity accounting will result in a
$3m (£2m) increase in reported revenues to approximately $56m (£36m). This  is 
due to the JVs' current stage of evolution, as development revenues earned  by 
Monitise from the JVs  exceed revenues generated by  the JVs themselves.   The 
impact on  EBITDA  and  Operating Profit  in  2011/12  is expected  to  be  an 
improvement in the region of $5m (£3m), with no significant change to reported
profit. The impact on  the financials for 2012/13  is expected to be  marginal 
for revenue, EBITDA and operating profit.

 

About Monitise

 

Monitise plc (LSE:  MONI.L) is  a technology and  services company  delivering 
mobile banking, payments  and commerce  solutions worldwide,  with the  proven 
expertise to enable financial institutions, network operators and merchants to
make money more mobile globally. With live  services in the UK, US, India  and 
Africa, Monitise securely processes hundreds of millions of transactions worth
billions of dollars each year via its Enterprise technology platform.

 

Following the acquisition of Clairmail, a California-based mobile banking  and 
payments specialist,  Monitise's strategic  partner and  client base  includes 
financial institutions  and payments  companies  such as  Visa Inc.  and  Visa 
Europe, FIS, Royal Bank  of Scotland, Fifth Third  Bank, HSBC, Lloyds  Banking 
Group, Co-operative Banking Group, Sallie Mae, PNC Bank, Frost National  Bank, 
Standard Chartered, Travelex, Permata Bank  and HDFC Bank among others.  Other 
leading partners  include  Vocalink, Vodafone,  Orange,  O2, T-Mobile,  3  UK, 
Research  In   Motion,   The   Carphone  Warehouse,   First   Eastern,   Astra 
International, JETCO and PCCW mobile.

 

More information is available at www.monitise.com

 

Contacts:

 

Monitise Group 
Gavin Haycock, Media Relations                      Tel:  +44 (0) 20 7947 4156

Gavin.haycock@monitisegroup.com                      
Haya Herbert-Burns, Investor Relations              Tel: +44 (0) 20 7947 4928

Haya.herbert-burns@monitisegroup.com                 
Monitise Group Executive Team
Alastair Lukies, Chief Executive Officer
John Brougham, Chief Financial Officer
Lee Cameron, Chief Commercial Officer
Mike Keyworth, Chief Operating Officer
Frank D'Angelo, President, Americas
Pete Daffern, President, Group Business Development
Lisa Stanton, EVP Payments
Canaccord Genuity Limited (NOMAD)                   Tel: +44 (0) 20 7523 8000
Simon Bridges
Cameron Duncan
FTI Consulting                                      Tel: +44 (0) 20 7831 3113
Charles Palmer
Jon Snowball

 

 

 

                     This information is provided by RNS
           The company news service from the London Stock Exchange
 
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TSTBRGDRUSBBGDL -0- Jul/17/2012 06:00 GMT