Monitise plc , 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.
-- Full-year 2012 revenues are expected to be approximately $53m (GBP 34m) (1), nearly two and a half times the $22m (GBP 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 (GBP 270m) in total.
-- Around $75m (GBP 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 (GBP 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 (GBP 2m) increase in reported full-year revenues to approximately $56m (GBP 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
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 (GBP 2m) increase in reported revenues to approximately $56m (GBP 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 (GBP 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.