TIDMMSG
MILESTONE GROUP PLC
("Milestone" or the "Company")
HALF YEARLY REPORT
Milestone Group PLC ("Milestone" or the "Company"), the AIM quoted (AIM:
MSG) provider of digital media and technology solutions, announces its
half yearly report for the six months ended 31 March 2017.
Highlights
-- Nexstar JV distributes first Independent Film, Brash Young Turks
-- Nexstar expanded offering to include BankHub
-- Post period, Nexstar launches KYC / AML platform
-- Cooperation agreement signed with the Social Stock Exchange
-- Launch of unique Alchemy digital media platform at the Apprenticeships 4
England event
-- Launch of Alchemy TV, 24/7 online over-the-top TV streaming service
-- OnGuard contract renewals and extensions agreed
-- GBP748,720 raised through Equity Issues during the period and GBP305,000
since the period end
-- Board taking action to recover GBP1.25m from the Company sourced placee
from October 2016 placing
Deborah White, Chief Executive, said:
"The last six months have been the most challenging during my time at
Milestone, however the opportunities made available via Nexstar's
innovative and disruptive technology applications continue to attract
attention from a growing number of market sectors. With additional sales
and marketing resources to support the Company's revised strategic focus
it is only a matter of time before their revenue potential becomes
apparent and the results of our efforts from 2016 begin to manifest."
For further information:
Milestone Group PLC
Deborah White, Chief Executive Tel: 020 7929 7826
Cairn Financial Advisers LLP, Nominated Adviser
Liam Murray / Sandy Jamieson Tel: 020 7213 0880
Hybridan LLP, Broker
Claire Louise Noyce Tel: 020 3764 2341
Walbrook PR Limited, PR
Gary Middleton / Paul Cornelius / Paul Whittington Tel: 020 7933 8780
CHIEF EXECUTIVE'S STATEMENT
The last six months have been the most challenging during my time at
Milestone. The positive developments and industry momentum built during
the course of 2016 were halted abruptly in Q4 2016 when GBP1.25 million
of funding failed to materialise from the Company sourced placee. This
funding was needed to on-board additional sales and marketing resources
and was key to the future expansion of the Company. The failure to bring
in the additional resource put additional pressure on a small team and
slowed the development of revenues across the board. The Company has
since concentrated its efforts on seeking an effective resolution to the
matter, reducing its cost base and supporting the development of its
subsidiary, Nexstar's growing suite of products and services. Post end
of period the Company has taken the opportunity to review its strategy
and has resolved to reposition the primary focus of the business towards
the provision of technology products primarily within the Financial
Services and Media arena. As such it will be reducing focus on some of
its legacy business areas including Passion Project.
Nexstar
Nexstar has a clearly defined development roadmap in media and fintech.
The existing media development continues to gain momentum with Brash
Young Turks the first independent film distributed through services such
as Amazon Prime. A growing selection of music artists are using its
products and services with a new version of the music-publishing
platform in development, which will allow artists to self-publish. We
fully expect a good take-up of these platforms as word of their
efficiency and costs savings filters round the sector and we build a
marketing team.
The historical commerce contracts have been brought back on track with
additional services from the newly released virtual banking suite now
being added to the services required. The joint venture continues to
expand its product offering with BankHub, the cash management platform
announced in the 30 March 2017 Annual General Meeting Statement, going
live during the period followed by the more recent announcement of a
Know Your Customer / Anti-Money Laundering application. Additional
complimentary developments will be announced soon.
Passion Project
During the period, the Passion Project signed a co-operation agreement
with the Social Stock Exchange and a strategic partnership agreement
with the Royal College of Arts to work on the Social Design of the
Passion Project initiative. These agreements demonstrate that the
commercial opportunities, made possible through cross-sector
collaboration combined with the potential social outcomes of the Passion
Project, are of interest to the marketplace. This distribution network
offers a significant commercial distribution opportunity to the
developing suite of products made available via Nexstar.
Milestone Foundation
Divert, a youth engagement initiative operated by the Milestone
Foundation in collaboration with the Metropolitan Police is currently
operating in two London Boroughs. The operation and staffing of this
initiative is now fully funded for the next 12 months by successful
grant applications, with further funding being sought to expand across
all 32 London Boroughs.
Alchemy
The Alchemy platform was well received at the Apprenticeships 4 England
launch event in January 2017 and continues to attract attention from
charities and corporate clients. The platform is a commercial product
designed to support the Passion Project partner network, showcase social
initiatives and engage commercial consumers for the Company's products
and services.
Active discussions are ongoing with a number of corporate clients
interested in using the product for Corporate Social Responsibility
initiatives and staff engagement and a growing number of charitable
enquiries are developing as a result.
OnGuard
The OnGuard platform products continue to grow in terms of user base,
with three contract renewals and extensions during the period. In
January 2017, our security services client in Manchester renewed their
agreement for a further 12 months, also increasing the contract value
three-fold. Renewals and annual payments were also received after the
period for STM Cleaning and Charlton Athletic Community Trust.
The platform has also been introduced in the management of Divert.
Disorder Magazine
Following his appointment as Editor in April 2016, Oliver Horton has
delivered on his task of rebuilding the Disorder brand and increasing
readership numbers, as well as delivering a consistent product to the
marketplace that could be sold both in hard copy and digitally.
Winning in the Game of Life
Winning in the Game of Life has had successful results from the 100
schools project with consistent feedback supporting the value of the
materials in delivering improvement in educational learning and
behavioural issues. The focus has been on attracting a distribution
partner in the educational sector to take the product to market and
support the development of Level 2. A version of this material for young
people is also being made available through the Passion Project for
trial with the participants of Divert.
Management Changes
The Board are making a number of management changes to strengthen and
support the refocus of the Company's operational and commercial
activities. In February 2017, David Hill resigned from his position as
Non-Executive Director following six years with the Company. The Board
are in the process of appointing a replacement and are in active
discussions with additional key personnel in support of the revised
strategy that are anticipated to be announced shortly following
regulatory due diligence.
Funding
During the period, the Company continued to raise funds through the
issue of shares to support the development of the business. The Company
raised GBP1,998,720 through the issue of shares for cash and settled
GBP45,701 of services through the issue of shares. As announced in
November 2016, GBP1,385,000 of this cash raised did not materialise.
GBP135,000 has subsequently settled by the Company's Broker, however
GBP1,250,000 from the Company sourced placee remains outstanding. The
Board continues to seek a resolution to this situation and expect to
provide an update in the near future. The Company continues to carefully
manage its working capital position and is currently considering a
number of funding opportunities. Further announcements will be made in
due course.
Outlook
Moving forward, the opportunities made available via Nexstar's
innovative and disruptive technology applications continue to attract
attention from a growing number of market sectors. With additional sales
and marketing resources to support the Company's revised strategic focus
it is only a matter of time before their revenue potential becomes
apparent and the results of our efforts from 2016 begin to manifest.
Deborah White
Chief Executive Officer
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
six months six months year
ended ended ended
31 March 31 March 30 Sept
2017 2016 2016
GBP GBP GBP
Revenue 22,272 50,408 71,359
Cost of sales (1,964) (12,916) (13,856)
Gross profit 20,308 37,492 57,503
Other operating income - - 1,738
Administrative expenses (1,153,253) (780,356) (1,820,652)
(1,152,882) (780,356) (1,818,914)
Loss from operations (1,132,945) (742,864) (1,761,411)
Net Finance income/(expense) 9 7 (2,104)
Loss before taxation (1,132,936) (742,857) (1,763,515)
Taxation charge - - 96,245
Total comprehensive loss for the year (1,132,936) (742,857) (1,667,270)
Attributable to equity shareholders of
the parent (1,132,936) (742,857) (1,667,270)
Total basic and diluted loss per share (0.12) (0.12) (0.25)
There were no comprehensive income and expense items (2016: nil) other
than those reflected in the above income statement. All results relate
to continuing activities.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
six months six months year
ended ended ended
31March 31March 30 Sept
2017 2016 2016
Note GBP GBP GBP
Non-current assets
Intangible fixed assets 1 1 1
1 1 1
Current assets
Trade and other receivables 101,872 67,602 187,836
Unpaid called up share capital 1,250,000 - -
Cash and cash equivalents 33,794 119,430 128,462
1,385,666 187,032 316,298
Current liabilities
Trade and other payables (1,346,944) (1,942,442) (1,201,928)
Interest-bearing loans (163,027) (259,647) (134,027)
(1,509,971) (2,202,089) (1,335,955)
Net Liabilities (124,305) (2,015,056) (1,019,656)
Capital and reserves attributable to equity holders
of the company
Share capital 4 1,082,141 625,163 783,998
Share premium account 16,831,053 13,669,203 15,073,350
Shares to be issued 29,695 609,500 63,081
Merger reserve 11,119,585 11,119,585 11,119,585
Capital Redemption Reserve 2,732,904 2,732,904 2,732,904
Retained losses (31,919,683) (30,771,411) (30,792,574)
Total Equity (124,305) (2,015,056) (1,019,656)
CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Unaudited Audited
six months six months year
ended ended ended
31 March 2017 31 March 2016 30 Sept 2016
GBP GBP GBP
Loss for the period (1,132,936) (742,857) (1,667,270)
Adjustments for:
Amortisation of intangible assets - 18,913 18,913
Net bank and other interest (income) / charges 9 7 2,104
Issue of share options / warrant charge 5,827 20,628 883,878
Services settled by the issue of shares 57,126 30,619 45,799
Net (loss) before changes in working capital (1,069,974) (672,690) (716,576)
Decrease / (increase) in trade and other
receivables 85,965 (4,124) (124,358)
Increase in trade and other
payables 144,997 167,976 (572,523)
Cash from operations (839,012) (508,838) (1,413,457)
Interest received 9 7 19
Interest paid - - (623)
Net cash flows from operating activities (839,003) (508,831) (1,414,061)
Financing Activities
Issue of ordinary share capital 715,335 382,646 1,424,028
Repayment of loan (25,000) - (65,000)
New loans raised 54,000 153,120 91,000
Net cash flows from financing activities
744,335 535,766 1,450,028
Net increase / (decrease) in cash (94,668) 26,935 35,967
Cash and cash equivalents at beginning of
period 128,462 92,495 92,495
Cash and cash equivalents at end of period
33,794 119,430 128,462
NOTES TO THE HALF YEARLY REPORT
1. General information
The principal activity of Milestone Group PLC ("Milestone" or "the
Company") and its subsidiaries (together "the Group") is the provision
of multimedia and technology solutions.
Milestone is the Group's ultimate parent company and is incorporated in
the United Kingdom with registration number 4689130. Milestone is
domiciled in the United Kingdom and has its registered office at 1(st)
Floor, 2 Royal Exchange, London EC3V 3DG, and this is its principal
place of business.
Milestone's shares are quoted on the AIM market of the London Stock
Exchange.
Milestone's consolidated financial statements are presented in Pounds
Sterling (GBP).
This consolidated financial information has been approved for issue by
the Board of Directors on 29 June 2017.
2. Basis of preparation
The financial information in the half yearly report has been prepared
using the recognition and measurement principles of International
Accounting Standards, International Financial Reporting Standards and
Interpretations adopted for use in the European Union (collectively
Adopted IFRSs). The principal accounting policies used in preparing the
half yearly report are those the Group expects to apply in its financial
statements for the year ending 30 September 2017 and are unchanged from
those disclosed in the Group's Directors' Report and consolidated
financial statements for the year ended 30 September 2016.
The financial information for the six months ended 31 March 2017 and the
six months ended 31 March 2016 is unaudited and does not constitute the
Group's statutory financial statements for those periods. The
comparative financial information for the full year ended 30 September
2016 has, however, been derived from the audited statutory financial
statements for that period. A copy of those statutory financial
statements has been delivered to the Registrar of Companies.
While the financial figures included in this half-yearly report have
been computed in accordance with IFRSs applicable to interim periods,
this half-yearly report does not contain sufficient information to
constitute an interim financial report as that term is defined in IAS
34.
Going concern
As stated in the accounts for the year to 30 September 2016, the future
business model of the Group is based around the generation of
sustainable revenues and profits through strategic partnerships and
joint ventures and from the Passion Project. As described in the Chief
Executive's statement, progress has been and continues to be made to
develop the Group's activities and associated revenues. However, as also
noted in the 30 September 2016 accounts, the Group needs to raise
further funds from the placing of shares whilst the revenues and profits
from these solutions are fully developed.
During the period the Group has raised funds of GBP1,998,720 through the
issuing of shares for cash and settled GBP45,701 of services through the
issue of shares. As stated in the Chairman's statement, GBP1,250,000 of
this cash has not been received. The Board continues to seek a
resolution to this situation. Since the period end further funds of
GBP305,000 have also been raised through further share placements.
In line with the plans and projections prepared by the Board, the
Group's activities continue to build, however in accordance with those
plans, in the short term the Group needs to continue to raise funds from
a combination of trading and placement of shares to fund its activities.
1. Loss per share
The calculation of the basic loss per share is based on the loss
attributable to ordinary shareholders divided by the average weighted
number of shares in issue during the period. The calculation of diluted
loss per share is based on the basic loss per share, adjusted to allow
for the issue of shares and the post tax effect of dividends and
interest, on the assumed conversion of all other dilutive options and
other potential ordinary shares.
There were 174,189,116 share options and 110,931,460 share warrants
outstanding at 31 March 2017 (2016: 104,042,000 and nil), however the
figures have not been adjusted to reflect conversion of these share
options as the effects would be anti-dilutive.
Weighted Weighted
Loss for 6 months to average Loss for 6 months to average
31 March 2016 number of Per share amount 31 March 2016 number of Per share amount
GBP shares (pence) GBP shares (pence)
(1,132,936) 975,529,255 (0.12) (742,857) 607,057,128 (0.12)
4. Share Capital
31 March 30 Sept
2017 2016
Number GBP Number GBP
Authorised
Ordinary shares of
0.1p 2,267,095,595 2,267,096 2,267,095,595 2,267,096
2,267,095,595 2,267,096 2,267,095,595 2,267,096
Allotted, called up
and fully paid
Ordinary shares of
0.1p 1,082,141,411 1,082,141 783,997,982 783,998
1,082,141,411 1,082,141 783,997,982 783,998
On 31 October 2016, the Company issued 92,333,332 ordinary shares at a
price of 1.5 pence per share for a cash consideration of GBP1,385,000.
As announced on 9 November 2016, the Company did not receive the
funding. As announced on 13 December 2016 and 27 February 2017, the
Company has now received GBP135,000 and continues to seek a resolution
for the remainder.
On 4 November 2016, the Company issued 48,333,334 ordinary shares at a
price of 1.5 pence per share for a cash consideration of GBP72,500 and
4,570,093 ordinary shares at a price of 1 penny per share for the
settlement of outstanding trade payables of GBP45,700.93.
On 13 December 2016, the Company issued 196,406,670 ordinary shares at a
price of 0.3 pence per share for a cash consideration of GBP541,220.
5. Note to the Consolidated Statement of Cash Flows
In addition to the cash flow statement, there is a non-cash transaction
of GBP1,250,000 relating to the defaulting placement in October 2016.
83,333,332 ordinary shares were issued at a price of 1.5 pence per
share. Funding has not been received for this share issue.
6. Availability of the Half Yearly Report
Copies of the half yearly report are available to shareholders on the
Company's website at www.milestonegroup.co.uk and from Milestone's
registered office: 1st Floor, 2 Royal Exchange Steps, London EC3V 3DG.
This announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Milestone Group PLC via Globenewswire
http://www.milestonegroup.co.uk/
(END) Dow Jones Newswires
June 30, 2017 02:00 ET (06:00 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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