TIDMBBB
RNS Number : 3305K
Bigblu Broadband PLC
28 August 2019
Bigblu Broadband plc
('BBB' or the 'Company')
Half year results for the six months ended 31 May 2019
Bigblu Broadband plc (AIM: BBB.L), a leading provider of
alternative super-fast broadband solutions, announces its unaudited
half year results for the six months ended 31 May 2019.
Financial Highlights
-- Total revenue increased 21.9% to GBP30.5m (1H18: GBP25.1m)
-- Like-for-like organic revenue growth(1) on a constant currency basis of 12.8% (1H18: 6.8%)
-- Average revenue per user (ARPU) increased 5.8% to GBP43.70 (1H18: GBP41.32)
-- Adjusted EBITDA(2) increased 56.4% to GBP4.3m (1H18: GBP2.8m)
-- Adjusted EPS(3) increased to 2.7p (1H18: 0.5p)
-- Operating Profit improved GBP5.4m to GBP0.7m (1H18: loss GBP4.7m)
-- Loss Per Share improved to 1.2p (1H18: 12.1p)
-- Net debt increased to GBP16.9m (FY18: GBP11.9m), in-line with
management expectations and expected to reduce significantly to
less than 1.5x EBITDA by the year end
Operational Highlights
-- Total number of customers increased 5% during the 6 month period to 119k (FY18: 113k)
-- Improved product suite with increased download speed and extended data allowances
-- Accelerated product roll-out via government funded schemes
with subsidised hardware and installation programmes
-- Strong organic growth across key regions:
o Euro Broadband Infrastructure S.à.r.l. ("EBI") agreement
underpinned strong organic European growth - adding 10,000
satellite customers during the period
o Leading position in Australia maintained - SkyMesh named best
NBN satellite provider
-- Average annualised customer churn in 1H19 reduced to 18.0% (1H18: 19.2%)
Post Period Events
-- Transformational GBP12m equity and debt funding package
secured for Quickline, a BBB subsidiary, to support accelerated
roll-out of fixed wireless networks in the UK:
o Now targeting an enlarged customer base of 30,000 subscribers,
which significantly increases estimated revenue, EBITDA and profit
contribution over the next three years
-- Continued support from main banking partner, HSBC with an
increased RCF facility to GBP10m, due to the strong underlying
EBITDA performance
-- Extension of existing support agreement with EBI to target
25,000 customers across Europe over the next 12 months
(1) Like-for-like organic revenue growth compares current and
prior period revenue treating acquired businesses as if they had
been owned for all of both periods on a constant currency basis
(2) Adjusted EBITDA is before share based payments and
exceptional items relating to M&A, integration costs and
investment in network partnerships
(3) Adjusted EPS is EPS before share based payments and
exceptional items relating to M&A, integration costs and
investment in network partnerships and amortisation charges,
divided by the weighted average number of shares over the
period
Andrew Walwyn, CEO of BBB, commented:
"This was another period of expansion for the Company as we
successfully developed our routes to market and customer base. The
combination of our technology agnostic product portfolio and strong
distribution partnerships ensured that we remained at the forefront
of the rapidly growing global alternative super-fast broadband
industry. Importantly, given the relationships and product sets we
now have in place, we are clearly demonstrating strong organic
growth. As such, we are extremely excited by the recent extension
of our agreement with EBI, which has performed strongly to date,
and the funding now in place to accelerate Quickline's fixed
wireless network roll-out.
This means that we are well placed to grow our customer bases
across our products and territories and benefit from increasing
margins due to the improved infrastructure and proven partnerships
already in place.
We therefore expect strong organic growth to continue for the
remainder of the current financial year following the EBI extension
and believe the Quickline funding will result in a significant
increase in our UK fixed wireless customer base.
We are extremely excited by the growth opportunities ahead and
expect the strong demand for our solutions to increase further as
we adopt new products with faster broadband speeds and unlimited
download limits whilst driving down the cost of customer
acquisitions and churn during the second half of the current
financial year."
For further information:
Bigblu Broadband Group PLC www.bbb-plc.com
Andrew Walwyn, Chief Executive Officer
Frank Waters, Chief Financial Officer
Dom Del Mar, Corporate Development Via Walbrook PR
Numis Securities (Nomad and broker)
Oliver Hardy (Corporate Advisory) Tel: +44 (0)20 7260
James Black (Corporate Broking) 1000
Tel: +44 (0)20 7933
Walbrook PR (PR / IR advisers) 8780 or
Paul Cornelius / Nick Rome Bigblubroadband@walbrookpr.com
About Bigblu Broadband plc
Bigblu Broadband plc (AIM: BBB), is a leading provider of
alternative superfast broadband solutions throughout Europe and
Australia. BBB delivers a portfolio of super-fast wireless
broadband products for consumers and businesses unserved or
underserved by fibre.
The Company has a significant target market with 27m customers
in Europe with speeds of under 4 Mb, and a further 1m in Australia
who have been identified as only suitable for either satellite or
fixed wireless broadband.
High levels of recurring revenue, increasing economies of scale
and Government stimulation of the alternative broadband market in
many countries provide a solid foundation for significant organic
growth as demand for alternative super-fast broadband services
increases around the world.
Acquisitive and organic growth have enabled BBB to grow rapidly
since inception in 2008 during which time the Company has completed
21 acquisitions across nine different countries. It is extremely
well positioned to continue growing as it targets customers that
are trapped in the 'digital divide' with limited fibre broadband
options.
BBB's range of solutions includes satellite, next generation
fixed wireless and 4G/5G delivering between 30 Mbps and 150 Mbps
for consumers, and up to 1 Gbps for businesses. BBB provides
customers ongoing services including hardware supply, installation,
pre and post-sale support billings and collections, whilst offering
appropriate tariffs depending on each end user requirements.
Importantly, as its core technologies evolve, and more
affordable capacity is made available, BBB continues to offer
ever-increasing speeds and higher data throughputs to satisfy
market demands for 'video-on- demand'. Its alternative broadband
offerings present a customer experience that is similar to that
offered by wired broadband and the connection can be shared in the
normal way with PCs, tablets and smart-phones via a normal wired or
wireless router.
CHIEF EXECUTIVE'S REPORT
When we came to the market in 2015, we had an
acquisition-focused strategy with a view to establishing a market
leading position within our key target territories. As such, the
initial focus was on creating critical mass and providing an
infrastructure to fully integrate acquisitions while ensuring we
could provide a range of solutions to the large number of consumers
and businesses that were suffering due to poor super-fast broadband
alternatives with download speeds of less than 30 Mbps.
We have since established a strong product suite with core hubs
and systems that have grown significantly both organically and
through acquisition. We are now focused on maximising the benefits
from our past acquisition-led activities to deliver continued
organic growth, which is now our core expansion model.
Driven by a combination of government legislation and subsidies,
as well as strong and fruitful partnerships with satellite
operators, we are benefiting from ever increasing demand for our
growing range of products, which now provide download and upload
speeds and data throughput rates that that can exceed the
requirements of even our most demanding customers across our target
territories.
Our organic growth across the UK and Europe during the period
under review was underpinned by our Preferred Partner Program (PPP)
agreement with Euro Broadband Infrastructure ("EBI"), a subsidiary
of Eutelsat (NYSE Euronext: ETL), which was announced in December
2018 and further extended in July 2019.
Under this commercial arrangement, EBI is providing satellite
network capacity, as well as assisting with subscriber premises
equipment, installation and marketing to support the 'Konnect'
brand. In return, BBB is promoting and selling satellite broadband
services while managing all activities related to subscriber
management including installation, billing and support. Given the
addition of 10,000 new customers via the agreement to date, this
relationship, which was recently extended, is expected to further
underpin low cost, high margin customer acquisition, enabling us to
target a further 25,000 customers across Europe and assist us in
achieving our pre-stated target of 150,000 customers by December
2020.
Importantly, government legislation and subsidies continue to
support our organic growth model - as highlighted by the receipt of
certification to participate in France's first national subvention
scheme whereby the French Government is offering a contribution of
up to EUR150/household to assist activation fees, kit purchase and
installation costs. According to the Agence du Numérique, two
million households, which are unable to access a minimum of 8MB/s
broadband through ADSL/Fibre by 2020 will be able to benefit from
the scheme.
Another important factor, which continues to underpin our growth
trajectory, is that we have established nine regional hubs in UK,
Ireland, France, Australia, Norway, Poland, Spain, Italy and
Germany. Importantly, the structure and scale of our global
operations means that the momentum achieved during the first half
of 2019 will continue into the second half and beyond.
The Company also maintained its dominant position in Australia
during the period. Since entering the satellite broadband market in
2016 following the acquisition of Skymesh, we have strengthened our
presence there and continue to command 50% market share of net new
adds under the Government funded NBNCo scheme. We continue to have
ambitious growth targets in Australia and were delighted that our
subsidiary SkyMesh was recently named Best Satellite NBN(TM)
Provider 2019.
Total Revenue
Total revenue increased by 21.9% to GBP30.5m (1H18: GBP25.1m)
with recurring revenue, defined as revenue generated from the
Company's broadband airtime, which is typically linked to contracts
representing approximately 83% of total revenue.
Customer numbers increased by 5% from 113k at the end of the
FY18 to 119k at the end of 1H19.
Adjusted EBITDA for the period was GBP4.3m compared to GBP2.8m
in 1H18, demonstrating the good progress made in driving top line
organic revenue alongside the benefits of 2018's acquisitions.
Post Balance Sheet Events
As announced on 6 August 2019, BBB's subsidiary Quickline
secured GBP12m of new equity and debt funding to aid its
accelerated fixed wireless network roll-out, which will mean many
more homes and businesses will get connected to next generation
super-fast broadband sooner and cheaper than before.
This GBP12m funding allows Quickline to significantly increase
the size and scale of its fixed wireless business to target a
customer base of approximately 30,000 subscribers over the next
three years, with significantly increased revenue, EBITDA and
profitability anticipated as new capital is deployed and the
business increases in scale.
In line with continued underlying EBITDA performance
improvement, BBB received additional support from our main banking
partner HSBC via an extension of the RCF facility, increasing to
GBP10m, an increase of GBP1.75m from previous levels.
Also, we were delighted to announce the extension of our
agreement with EBI announced recently. This is a key cornerstone of
our organic growth strategy. Importantly, this partnership means
that we can offer unlimited packages currently reaching broadband
speeds of up to 50 Mbps and set to grow to 100 Mbps.
The broadband services being offered to new customers under the
programme are complemented by an attractive pricing structure that
presents a genuine alternative to comparable broadband offerings.
This combination will enable BBB to continue to improve customer
churn rates, which are already decreasing as satellite broadband
speeds and service performance increase.
Outlook
The Company is extremely well placed to continue driving organic
growth through the partnerships and product suites in place whilst
new products with faster broadband speeds and unlimited download
limits are also set to underpin growth. There continues to be
strong demand for alternative super-fast broadband solutions and,
as such, the Company is strategically well placed to continue
growing its customer base with both churn rates decreasing and
gross margins improving throughout the remainder of the financial
year.
We also expect strong cash generation from the business in the
second half of the financial year, which together with secured
funding for Quickline, will significantly decrease net debt by the
period end. We anticipate net debt to fall to less than 1.5x EBITDA
by the year end.
Andrew Walwyn
CEO
28 August 2019
FINANCIAL REVIEW
In the half year to 31 May 2019, total revenue increased by
21.9% to GBP30.5m (1H18: GBP25.1m), driven by an increase in
organic new connections, improving ARPU's and the impact of the
acquisitions made in 2018.
Gross profit increased to GBP13.3m (1H18: GBP9.4m) representing
an improved gross profit margin of 43.7% (1H18: 37.4%).
Distribution and administrative expenses increased to GBP9.0m
(29.5% of revenue) (1H18: GBP6.6m - 26.3% of revenue) primarily as
a result of increased investment in central overheads to support
scaling up of the European partnership agreements across both
existing and new hubs.
Company statutory results
Adjusted EBITDA (before share based payments and specific items
relating to M&A, integration and the establishment of the
network partnerships) for the half year increased 56.4% to GBP4.3m
(1H18: GBP2.8m).
The Company incurred net acquisition, deal, legal and employee
costs relating to M&A activities of GBP0.1m in the period
(1H18: GBP1.0m). These costs comprise mainly professional and legal
fees. Such identifiable costs will increase in the second half of
the year following the successful fundraise for Quickline.
A reconciliation of the adjusted EBITDA to statutory operating
profit for 1H19 of GBP0.7m (1H18: GBP4.7m loss) is shown below:
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
31 May 31 May 30 November
2019 2018 2018
GBP000 GBP000 GBP000
Adjusted EBITDA 4,335 2,773 6,806
Depreciation (1,439) (1,593) (6,629)
Amortisation (1,892) (4,560) (7,491)
----------- ----------- -------------
Adjusted EBIT 1,004 (3,380) (7,314)
Share based payments (204) (250) (395)
Exceptional items relating to M&A, integration and the establishment of the
network partnerships. (101) (1,047) (5,290)
Statutory operating profit / (loss) 699 (4,677) (12,999)
----------- ----------- -------------
Revenue and adjusted EBITDA in 1H19 and the comparative period
is segmented by geography as follows:
Revenue Adjusted EBITDA
Unaudited Unaudited Audited Unaudited Unaudited Audited
6 months to 6 months to 12 months 6 months to 6 months to 12 months
to to
31 May 2019 31 May 2018 30 November 2018 31 May 2019 31 May 2018 30 November 2018
Segment GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
UK 9,667 8,530 16,405 3,031 2,026 2,462
Europe (1) 13,790 8,090 23,780 1,870 1,732 6,524
Australia 7,069 8,431 15,166 1,022 435 1,505
Central and PLC costs (2) - - - (1,588) (1,420) (3,685)
------------ ------------ ---------------- ------------ ------------ ----------------
Total 30,526 25,051 55,351 4,335 2,773 6,806
------------ ------------ ---------------- ------------ ------------ ----------------
(1) Europe includes Norway, France, Ireland, Poland, Italy and
Germany, Sweden, Finland, Poland and Spain
(2) Central costs include finance, IT, marketing and plc
costs
The Company has continued to make good progress in expanding its
customer base, driven by the impact of organic new adds and the
impact of 2018 acquisitions. As a result, total customers increased
from 112,720 at the end of the FY18 financial year to 119,188 at
the end of the current period.
The Company's total customer base of 119,118 as at 31 May 2019
was split as follows:
-- UK: 23% (1H18: 23%)
-- Europe: 49% (1H18 44%)
-- Australia: 28% (1H18: 33%)
Average revenue per user ("ARPU") increased by 5.8% between 1H18
and 1H19 to GBP43.70 per month (1H18: GBP41.32).
Customer average annualised churn was 18% (1H18: 19.2%) in the
period. Whilst customer churn is in line with management
expectations at this stage, we are confident churn will reduce in
the second half of the year as we continue to invest in our
customer engagement programmes, our network suppliers offering more
compelling services and significant improvements in our customer
support platforms come on-stream as planned. Churn has reduced in
part due to the migration of certain customers to better network
packages, plus we are seeing lower churn in Quickline and Skymesh
due to improvement in services provided and faster networks.
Interest costs during the half year to 31 May 2019 remained
constant at GBP1.1m (1H18: GBP1.1m). The difference between the
charge in the income statement and the interest paid in the cash
flow statement relates to the accrued redemption premium on the BGF
debt.
Cash flow Analysis
Underlying operating cash flows improved to GBP2.3m in 1H19 from
outflows of (GBP1.0m) in 1H18. This reflects an uplift in adjusted
EBITDA of GBP1.6m as well as a GBP1.8m improvement in underlying
working capital. This underlying operating cash flow improvement
results in an EBITDA conversion of 54% 1H19 versus (37%) in
1H18.
As highlighted at the year-end, we have had great support from
our main airtime suppliers, and we will continue to work with them
to ensure that trading and payment terms are appropriate alongside
marketing and product support to ultimately ensure that the
customer continues to get better product offerings.
Tax and interest paid increased slightly to GBP0.7m in 1H19 from
GBP0.6m in 1H18.
Purchase of assets of GBP3.4m in 1H19 compares to GBP0.9m in
1H18 as the Group continues to invest in its fixed wireless
infrastructure in addition to investing in providing PPP customers
with equipment for the services provided, previously supplied
direct by networks.
The net summary of the above is an improvement in Equity free
cash flow to (GBP1.8m) in 1H19 from (GBP2.6m) in 1H18 as
follows:
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
31 May 31 May 30 November
2019 2018 2018
Underlying Operating cash flows(1) 2,327 (1,016) 7,402
Interest and Tax (731) (640) (1,496)
Purchase of assets (3,386) (934) (2,282)
------------- ------------- --------------
Equity free cash flow (outflow)/inflow (1,790) (2,590) 3,624
(1) Underlying Operating Cash flows is before interest, tax,
forex, non-cash items and exceptional items relating to M&A,
integration costs and investment in network partnerships
Net debt increased by GBP5m in the period from GBP11.9m to
GBP16.9m, as anticipated by management. This increase reflects the
equity free cash outflow of GBP1.8m detailed above together with an
outflow of GBP0.9m due to exceptional costs relating to M&A and
integration costs in addition to the investments in network
partnerships. In addition, Quickline's successful post acquisition
performance resulted in a GBP2.0m earnout payment. Following the
post balance sheet event refinancing of Quickline, there will be no
further earn outs payable.
Management expects net debt to reduce in 2H19, following the
Quickline transaction and further improvements in underlying cash
flow. We expect the net debt/EBITDA ratio to reduce to less than
1.5x by the end of the current financial year, notwithstanding
ongoing investment to support growth.
Net debt comprises:
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
31 May 31 May 30 November
2019 2018 2018
GBP000 GBP000 GBP000
Cash 3,363 7,445 5,067
Debt (20,256) (16,889) (16,979)
------------- ------------- --------------
Net Debt (16,893) (9,444) (11,912)
------------- ------------- --------------
Bigblu Broadband plc
Condensed consolidated statement of comprehensive income
6 months ended 31 May 2019
Unaudited Unaudited Audited
6 months to 6 months to 12 months
31 31 to 30
May May November
2019 2018 2018
GBP000 GBP000 GBP000
Continuing Operations
Revenue 30,526 25,051 55,351
Cost of goods sold (17,198) (15,685) (32,859)
------------ ------------ -----------
Gross Profit 13,328 9,366 22,492
Distribution and administration
expenses (8,993) (6,593) (15,686)
Depreciation and amortisation (3,331) (6,153) (14,120)
M&A, integration and the
establishment of the network
partnerships costs (101) (1,047) (5,290)
Share based payments (204) (250) (395)
------------ ------------ -----------
Operating Profit / (Loss) 699 (4,677) (12,999)
Interest Payable (1,096) (1,060) (2,167)
------------ ------------ -----------
Loss before Tax (397) (5,737) (15,166)
Tax on continuing operations (280) 133 1,870
------------ ------------ -----------
Loss for the period (677) (5,604) (13,296)
Other comprehensive income
Foreign currency translation
difference 221 (84) (394)
------------ ------------ -----------
Total comprehensive Income (456) (5,688) (13,690)
------------ ------------ -----------
Loss per share
from continuing operations
Basic (pence) (1.2) (12.1) (25.8)
Bigblu Broadband plc
Condensed consolidated statement of financial position
As at 31 May 2019
Unaudited Unaudited Audited
As at As at As at
31 May 2019 31 May 2018 30 Nov 2018
GBP000 GBP000 GBP000
Non-Current Assets
Property Plant and Equipment 7,067 7,097 5,517
Intangible assets 34,610 35,571 36,087
Investments 26 345 53
------------ ------------ ------------
Total Fixed Assets 41,703 43,013 41,657
------------ ------------ ------------
Current Assets
Inventory 2,818 1,512 1,950
Trade & Other Debtors 13,999 7,338 9,893
Deferred Tax asset 882 622 882
Cash and Cash Equivalents 3,363 7,445 5,067
------------ ------------ ------------
Total Current Assets 21,062 16,917 17,792
------------ ------------ ------------
Current Liabilities
Trade Payables (10,274) (8,051) (9,677)
Other Creditors and Accruals (19,194) (14,052) (18,682)
Payroll taxes (830) (843) (936)
VAT (2,101) (1,987) (2,018)
------------ ------------ ------------
Total Current Liabilities (32,399) (24,933) (31,313)
------------ ------------ ------------
Non-Current Liabilities
Loans and debt facilities (20,256) (16,889) (16,979)
Other payables - - (409)
Deferred taxation (657) (1,292) (657)
------------ ------------ ------------
Total Non-Current Liabilities (20,913) (18,181) (18,045)
------------ ------------ ------------
Total Liabilities (53,312) (43,114) (49,358)
Net Assets 9,453 16,816 10,091
------------ ------------ ------------
Equity
Share Capital 8,522 8,446 8,506
Share Premium 23,900 23,900 23,900
Other Reserves 12,074 11,055 12,272
Revenue Reserves (35,043) (26,585) (34,587)
Total Equity 9,453 16,816 10,091
------------ ------------ ------------
Bigblu Broadband plc
Condensed consolidated Cash Flow Statement
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
31 May 31 May 30 November
2019 2018 2018
GBP000 GBP000 GBP000
Loss after tax for the year (677) (5,604) (13,296)
Interest 1,096 1,060 2,167
Taxation 280 (133) (1,870)
Amortisation and impairment of intangible assets 1,892 4,559 7,491
Depreciation charge 1,439 1,594 6,629
Share based payments 204 250 395
Foreign exchange variance and other non-cash items 163 (365) (130)
Release of grant creditors (615) (391) (2,556)
Movement in working capital (4,318) 1,887 6,040
Operating cash flows generated / (used) in operating activities (536) 2,857 4,870
------------ ------------ --------------
Investing activities
Interest paid (782) (640) (1,478)
Tax refund / (paid) 51 - (18)
Purchase of assets (3,386) (934) (2,282)
Purchase of intangibles (308) (4,739) (5,498)
Purchase of investments (333) (6,433) (8,169)
------------ ------------ --------------
Net cash used in investing activities (4,758) (12,746) (17,445)
------------ ------------ --------------
Financing activities
Proceeds from issue of ordinary share capital net 310 11,542 11,948
Cash within subsidiaries acquired - 1,742 1,491
Loans received subsidiaries acquired - 400 459
Loan repayments (70) (52) (108)
Proceeds from Loans 3,350 250 400
------------ ------------ --------------
Cash generated from financing activities 3,590 13,882 14,190
------------ ------------ --------------
Net increase / (decrease) in cash and cash equivalents (1,704) 3,993 1,615
Cash and cash equivalents at beginning of period 5,067 3,452 3,452
------------ ------------ --------------
Cash and cash equivalents at end of period 3,363 7,445 5,067
------------ ------------ --------------
Bigblu Broadband plc
Condensed consolidated Reserves Movement
6 months ended 31 May 2019
Share Share Other Revenue Total
Capital Premium Reserves Reserve
GBP000 GBP000 GBP000 GBP000 GBP000
Note 4
At 31 May 2018 8,446 23,900 11,055 (26,585) 16,816
Profit / (Loss) for
the period - - - (8,002) (8,002)
Issue of shares 60 - - - 60
Share option reserve - - 393 - 393
Foreign Exchange Translation - - 824 - 824
--------- --------- ---------- ----------- ---------
At 30 November 2018 8,506 23,900 12,272 (34,587) 10,091
Profit / (Loss) for
the period - - - (456) (456)
Issue of shares 16 - 89 - 105
Share option reserve - - 204 - 204
Foreign Exchange Translation - - (491) - (491)
--------- --------- ---------- ----------- ---------
At 31 May 2019 8,522 23,900 12,074 (35,043) 9,453
--------- --------- ---------- ----------- ---------
Bigblu Broadband plc
Notes to the financial statements
For the period ended 31 May 2019
1. Presentation of financial information and accounting
policies
Basis of preparation
The condensed consolidated financial statements are for the half
year to 31 May 2019.
The nature of the company's operations and its principal
activities is the provision of last mile (incorporating Satellite
and Wireless) broadband telecommunications and associated / related
services and products.
The company prepares its consolidated financial statements in
accordance with International Accounting Standards ("IAS") and
International Financial Reporting Standards ("IFRS") as adopted by
the EU. The financial statements have been prepared on the
historical cost basis, except for the revaluation of financial
instruments.
The company has adopted IFRS 15 'Revenue Recognition' in the
current year with no impact on the way that the company report
revenue.
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts in the
financial statements. The areas involving a higher degree of
judgement or complexity, or areas where assumptions or estimates
are significant to the financial statements are disclosed further.
The principal accounting policies set out below have been
consistently applied to all the periods presented in these
financial statements, except as stated below.
Going concern
The Directors have prepared and reviewed projected cash flows
for the Company reflecting its current level of activity and
anticipated future plan for the next 12 months. The Company is
currently posted an operating profit after amortisation charges,
and a loss before tax after interest, and will continue to be so
for the foreseeable future, as the Company continues to invest in
the business growth strategy of acquiring similar businesses. The
business continues to grow the number of users in a number of key
target markets and continues to review the short-term business
model of the company by which the company becomes profitable and
delivers a return on the investments.
The Board has concluded that no matters have come to their
attention which suggest that the Company will not be able to
maintain its current terms of trade with customers and suppliers.
The Company's forecasts for the newly combined Company, and taking
into consideration the expected operating profit forecast for the
current year to continue, as well as taking account of possible
changes in trading performance, indicate that the Company has
sufficient cash available to continue in operational existence
throughout the forecast period and beyond. As a consequence, the
Board believes that the Company is well placed to manage its
business risks and longer-term strategic objectives, successfully.
Accordingly, they continue to adopt the going concern basis in
preparing these results.
Estimates and judgments
The preparation of a condensed set of financial statements
requires management to make judgments, estimates and assumptions
about the carrying amounts of assets and liabilities at each period
end. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates. The
estimates and adjusted assumptions are reviewed on an ongoing
basis.
In preparing these condensed set of consolidated financial
statements, the significant judgments made by management in
applying the Company's accounting policies and the key sources of
estimating uncertainty were principally the same as those applied
to the Company's and Individual company's financial statements for
the year ended 30 November 2018.
Basis of consolidation
The condensed consolidated financial statements comprise the
financial statements of Bigblu Broadband Group plc and its
controlled entities. The financial statements of controlled
entities are included in the consolidated financial statements from
the date control commences until the date control ceases.
The financial statements of subsidiaries are prepared for the
same reporting period as the parent company, using consistent
accounting policies.
All inter-company balances and transactions have been eliminated
in full.
2. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to shareholders by the weighted average number of
ordinary shares in issue during the period.
IAS 33 requires presentation of diluted EPS when a company could
be called upon to issue shares that would decrease earnings per
share or increase the loss per share. For a loss-making company
with outstanding share options, net loss per share would be
decreased by the exercise of options. Therefore, as per IAS33:36,
the antidilutive potential ordinary shares are disregarded in the
calculation of diluted EPS.
Reconciliation of the profit and weighted average number of
shares used in the calculation are set out below:
Weighted average
Loss number of shares Per share amount
At 31 May 2018
Basic and Diluted EPS GBP000 units Pence
Loss attributable to shareholders:
- Continuing operations (5,604) 46,462,281 (12.06)
Weighted average
Loss Number of Shares Per share amount
At 31 May 2019
Basic and Diluted EPS GBP000 units Pence
Loss attributable to shareholders:
- Continuing operations (677) 56,723,149 (1.19)
Adjusted EPS* for the half year to 31 May 2019 of 2.68p and half
year to 31 May 2018 of 0.54p.
* Adjusted EPS is EPS before share based payments and
exceptional items relating to M&A, integration costs and
investment in network partnerships and amortisation charges,
divided by the weighted average number of shares over the
period.
3. Other Reserves Movements
Foreign
Listing Merger Reverse Other exchange Share Total
Cost Relief acquisition equity translation option capital
reserve reserve reserve reserve reserve reserve reserves
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 31 May 2018 (219) 16,233 (3,317) 271 (2,980) 1,067 11,055
Foreign exchange
translation - - - - 824 - 824
Equity settled
share-based payments - - - - - 393 393
-------- -------- ------------ -------- ------------ -------- ---------
At 30 November
2018 (219) 16,233 (3,317) 271 (2,156) 1,460 12,272
Other equity - - - - - 89 89
Foreign exchange
translation - - - - (491) - (491)
Equity settled
share-based payments - - - - - 204 204
-------- -------- ------------ -------- ------------ -------- ---------
At 31 May 2019 (219) 16,233 (3,317) 271 (2,647) 1,753 12,074
-------- -------- ------------ -------- ------------ -------- ---------
4. Other capital reserves continued
Listing cost reserve
The listing cost reserve arose from expenses incurred on AIM
listing.
Other equity reserve
Other Equity relates to the element of the BGF Convertible Loan
which has been grossed up but may be shown net.
Reverse acquisition reserve
The reverse acquisition reserve relates to the reverse
acquisition of Satellite Solutions Worldwide Limited by Bigblu
Broadband Group plc on 12 May 2015.
Foreign exchange translation reserve
The foreign exchange translation reserve is used to record
exchange difference arising from the translation of the financial
statements of foreign operations.
Share option reserve
The share option reserve is used for the issue of share options
during the year plus charges relating to previously issued
options.
Merger relief reserve
The merger relief reserve relates to the share premium
attributable to shares issued in relation to the acquisition of
Bigblu Operations Limited (Previously Satellite Solutions Worldwide
Limited)
5. Availability of the Interim Report
A copy of these results will be made available for inspection at
the Company's registered office during normal business hours on any
weekday. The Company's registered office is at Broadband House, 108
Churchill Road, Bicester OX26 4XD. The Company is registered in
England No. 9223439.
A copy can also be downloaded from the Company's website at
https://bbb-plc.com/
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR DBGDIRGDBGCR
(END) Dow Jones Newswires
August 28, 2019 02:00 ET (06:00 GMT)
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