The Chairman's review of the Company's activities, announced on 2nd June 2005, has been completed. Earthport has been restructured and its strategy and activities realigned as set out below:
Balance sheet restructuring
As previously announced, the balance sheet has been strengthened by replacing £4.0m of secured loans and unsecured finance leases with a £1.25m secured loan facility, repayable over five years. Obligations have thus, through negotiation, been reduced by £2.75million and extended to a longer maturity. In addition £3.2million of Loan Stock presently on the balance sheet will convert automatically into equity before 30 June 2006.
Also as previously announced, following the EGM, earthport has raised £4.5 million of equity funding. The Directors believe that earthport now has an appropriate financing strategy in place to take it to and past cash neutrality.
All litigation has been resolved with the possible exception of matters concerning Mr Cunningham's dismissal.
Sales and Marketing
A new sales and marketing team has been recruited to focus on winning business that maximises the Company's key strengths. These are the global banking network, comprising 35 local territory accounts which provide the ability to collect and pay out funds in more than 120 territories, and the software which manages the network; which together make up the Universal Payment Network (UPN).
The sales team, led by Matt O'Donnell, is now concentrating on providing infrastructure payment services in the following key sectors: insurance; foreign exchange; payment service providers; and send money home services. In particular, earthport, as a Founder Member and Stakeholder in the International Association of Money Transfer Networks, is committed to servicing the Money Transfer Operators and their consumers through the provision of the UPN.
The sales team has been active only since the beginning of October and new clients have already been won including: Compass Intermediaries; DataCash; Kurdistan Development Corporation, InstaMoney, Desklink Office Furniture Limited, FX auctions, Ezybonds and 5 Star mobile phone imports.
The earthport website has been redesigned to reflect the Company's new direction and will be released shortly. The marketing team, led by Nick Dunlop, is sourcing new business and positioning earthport as the independent utility of choice for the payment and collection of funds for national and global money movement applications.
Noel Jones who was Technical Adviser to the Board has now consolidated his position within earthport as Chief Technical Officer. He leads a strong team, which is improving the technical offering, already robust and reliable, to be scalable and ready to receive the impending increases in transaction flow which will result from the sales and marketing drive.
In addition ensurePay, the existing business division, handling online gaming customers, continues to provide revenues under the direction of Mark Burbidge and new contracts have been agreed with Betfair, Ladbrokes and Proc-Cyber.
earthport Chairman Mike Harrison said, "I am pleased with the results of the review, we have been able to focus the Company on its core business opportunities: build a sound financial basis to exploit these opportunities; and put in place a new sales and marketing team who are already yielding significant results after only a couple of months. We look forward to the future with confidence."