TIDMSEEN
RNS Number : 5104A
Entertainment AI PLC
30 September 2020
SEEEN plc
("SEEEN", "Group", or the "Company")(1)
Interim Results
SEEEN plc (AIM:SEEN.L), the global media and technology platform
business reimagining video for the digital age, is pleased to both
update on results from its initial product deployments and provide
its Interim Results for the six months ended 30 June 2020.
-- Despite the impact of Covid-19, the Group remains in-line
with market expectations for profit whilst prioritising deployment
of EIS/VCT investment to build-out the Group's technology platform
during 2020;
-- Group has sufficient cash to execute its business plan;
-- 3Q 2020 YouTube gross revenue has grown significantly over 3Q
2019 as rebound from Covid-19 continues;
-- B2B Sales Pipeline for technology go-to-market in 4Q is
strong and growing, underpinned by completed pilot projects.
Operational Highlights
-- Release of first proprietary AI products, CreatorSuite and
Syndication Widgets , generating video moments with significant
production efficiencies for competitive advantage
-- Pilot trials of CreatorSuite and Syndicat ion Widgets with
third parties g enerated proprietary data on how SEEEN products
produce monetizable value for creators, brands and publishers:
o Increase d search rank for videos and organic traffic by
35%
o Increase d session duration(2) by factor of up to 3 times
o Reduced bounce rates(3) to below 25%
o Clickthrough rates of 6% versus video average of approximately
0.6%
-- Launch of new gtchannel.com we bsite, which is fully based on
the Group's Micro Moment technology, resulting in improved reach,
engagement and conversion
1H Financial Highlights (4)
-- SEEEN's wholly-owned multichannel network ( "MCN") audience
views increased by 30% to 8.4 billion (1H 19: 6.5 billion)
o 1H total views represented nearly the same amount as views
achieved in full-year 2018 (8.5 billion)
-- Gross YouTube advertising revenue declined by 23% to $6.6m
(1H 19: $8.7m) reflecting global ad market decline in spend during
Covid-19
-- Net Revenues (minus YouTube commission) declined by 22% to $3.7m (1H 19: $4.8m)
o Average RPM of $0.78 in 1H 20 down 40% (1H 19: $1.34)
o Covid-19 impact on global advertising budgets:
-- Pre-Covid January and February saw year on year increases
-- March to June results adversely affected due to contraction of digital ad budgets
-- Adjusted (5) loss before tax in-line with pre-COVID
expectations at $1.1 million with Group prioritising deployment of
EIS/VCT investment to build-out its technology platform during
2020
-- Cash of $7.2 million at end of the period; provides
sufficient cash to execute on growth plan
3Q Subsequent Events
-- Release of new product JetStream, which provides direct
access to SEEEN's underlying proprietary AI engines for Micro
Moment creation
-- 3Q Momentum:
o Viewer growth accelerates to 50% ahead of 3Q 2019
o Revenue improves substantially, with revenues approximately
20% ahead of 3Q 2019
Confirmation of Name Change
-- The Company's change of name to SEEEN plc has now been
registered at Companies House and is effective on AIM from Thursday
1 October 2020 at 8.00 a.m.
o The Company's ISIN and TIDM will remain unchanged.
_____________
Notes:
1. As noted above, the Company's change of name from
Entertainment AI plc to SEEEN plc has been registered at Companies
House and will be effective on AIM from 1 October 2020 at 8.00
a.m.
2. Average Session Duration: Length of time a viewer stays on
the website
3. Bounce Rate: Number of viewers that click on a link to the
website but close the website without viewing
4. Given the timing of the acquisition of SEEEN, Inc, GTChannel,
Inc and Tagasauris, Inc by the Company on 30 September 2019, the
comparison between the results for the six months to 30 June 2020
and for each of the six months to 30 June 2019 and the twelve
months to 31 December 2019 is not meaningful. Where appropriate,
comparable results for the Group are included in the
highlights.
5. Adjusted profit before tax is defined as statutory operating
profit plus share-based payments and amortisation of intangible
assets.
Dr. Patrick DeSouza, Chairman of SEEEN, commented:
"We are on-track with the development of our video Micro Moments
strategy. We have been working with various potential business
customers, especially our strategic partner Sumitomo Corporation of
Japan, to prepare for scalable commercialization. 2H looks
promising given the 3Q rebound of our MCN revenue and the building
of our B2B sales pipeline. We have sufficient cash to execute our
plan and look forward to the next two quarters to show commercial
traction with our revolutionary products. Ironically, given the
impact of Covid and consumers staying at home, our video moments
technology is in high demand and business customers are looking for
solutions to increase advertising yield through targeted video
content and passionate engagement by audiences. We are coming at
the right time in 4Q with those solutions."
Todd Carter, CEO of SEEEN, commented:
"Since our IPO, we have invested in developing solutions that
reimagine video for viewers, creators, publishers and brands. In
CreatorSuite we have a proven technology platform that unleashes
video content by delivering the only automatic generator of
Micro-Moments that are optimized for Google search. We are now
positioned to offer our Content as a Service ("CaaS"), video-first,
digital experience platform ("DXP") to all sizes of video creators,
ranging from channel partners on our MCN to established brands,
both within and outside of our core automotive and associated
lifestyles markets. The key performance indicators revealed by our
web analytics confirm that digital experiences based on our Content
as a Service offering directly and positively impact reach, rank,
engagement and conversion. Both GTChannel.com and our launch
partners have benefited from both additional revenues through
increased monetization, as well as reducing the costs of paid
search, and advertising to drive traffic to their sites."
For further information please contact:
SEEEN
Patrick DeSouza, Chairman Tel: +1 203 654 5426
Todd Carter, CEO
Adrian Hargrave, CFO Tel: +44 (0)7775
701 838
Website: seeen.com
Dowgate Capital Limited - Joint Broker Tel: +44(0)7920 599
Stephen Norcross 793
WH Ireland Limited - NOMAD and Broker Tel: +44 (0)20 7220
1666
Adrian Hadden
James Sinclair-Ford
Matthew Chan
Certain information contained in this announcement would have
constituted inside information (as defined by Article 7 of
Regulation (EU) No 596/2014) ("MAR") prior to its release as part
of this announcement and is disclosed in accordance with the
Company's obligations under Article 17 of MAR.
CEO's Statement
Overview
Despite COVID-19, we have remained disciplined about executing
our business plan. SEEEN has two business lines, a consumer based
MultiChannel Network ("MCN") and a B2B AI publishing platform, that
delivers enriched video and Micro-Moments to viewers across
multiple channels. During 1H we deployed our EIS/VCT investment to
productize our patented human-assisted computing AI and machine
learning technology to drive our B2B business and enhance our MCN.
Since our IPO, we have used our MCN, with its annualised audience
of more than 15 billion video views and its accompanying behavior
data, as an incubator to inform and refine our B2B product roadmap.
During 3Q we tested our products with brands, creators and
consumers during the first stage of our "Go-To-Market" strategy,
whilst building a substantial sales pipeline. During 4Q, on
schedule, we anticipate launching our B2B business, driven by the
sale and licensing of our CreatorSuite DXP and Video Micro-Moments
technology and products. We also look forward to driving our
complementary MCN revenue channel.
The need for our technology and product solutions for all video
creators has been highlighted by the results of our MCN in 1H 2020.
These results have been affected by ongoing market trends, which
were accelerated by COVID-19. Positively, 1H20 views grew by 30% to
8.4 billion (nearly as many as for the whole year of 2018 - 8.5
billion), but revenues for the period fell by 22% to $3.7 million.
This was entirely driven by a reduction in advertising spend on
YouTube, which caused our RPM (revenue per 1,000 views) to fall 40%
to $0.78. As we have applied CreatorSuite, 3Q has shown both a
dramatic rebound in revenue growth and an acceleration in viewer
growth, respectively up 20% and 50% against the same period last
year. During 4Q, as discussed below, we expect the impact of our AI
products will drive our MCN business and accelerate growth.
Meanwhile, SEEEN's B2B business delivers "video unleashed" - our
tagline - because the transformative nature of the user experience
we provide, enables our viewers to effortlessly seek, immediately
view and frictionlessly interact with the segmented subparts of
video, much like skipping over chapters in a book, while watching
the sections they want to see. Analysts have termed the fast
growing $125 billion+ global market in which our B2B products
compete, "Content as a Service ("CaaS")". To date, we have unveiled
three related products which we've shown to potential customers:
CreatorSuite, our Syndication Widgets, and most recently JetStream.
CreatorSuite and our Syndication Widgets have demonstrated strong
monetizable impact in terms of (i) reach and rank on search engine
result pages ("SERP"), (ii) video engagement and (iii) purchase
behavior and conversions. JetStream, our video stream processing
platform and the data backbone of SEEEN, makes these innovations
possible. Our customer deployments have produced a strong B2B sales
pipeline that is discussed below. We are now at the stage of going
to market with Video Reimagined.
Market Demand for Video Reimagined
The market demand for "video reimagined" is driven by a paradox.
In a world where video content has grown increasingly abundant,
immediately available attention becomes the limiting factor in the
consumption of more video content. For creators, publishers and
brands that means that consumers now expect digital video
experiences to be immediate, relevant and convenient. Satisfying
viewer expectations today, particularly on mobile which accounts
for nearly half of online video views, will soon require the
ability to seamlessly jump, like chapters in a book, between the
segmented subparts of a video; watch the content in full; or
explore contextually relevant links, including in-the-moment help
and guidance with purchase making decisions.
A second-order effect brought about by attention becoming the
limiting factor in the discovery and consumption of video is the
related requirement for vendors to engage consumers on their
preferred platforms. Creators, publishers and brands seek to
provide optimal digital video experiences across a growing variety
of channels. These multi-experience requirements are in turn
driving demand for a new kind of CMS (content management system) or
DXP (digital experience) platform. We are able to fill this market
need with our products delivered as a SaaS (software as service)
business model.
CreatorSuite, our video-first CaaS DXP is SEEEN's answer to
these emerging needs. CreatorSuite leverages the Company's patented
human-in-the-loop AI technology, through JetStream, to unleash
SEEEN's vision of video reimagined, automating the once tedious and
expensive task of creating and publishing enriched and hyperlinked
video. Micro-Moments, which are shorter, hyperlinked subsegments of
a full video, enable optimal mapping of content and services to
demand. CreatorSuite powered websites, together with our
distributed promotional and syndication widgets, deliver richer,
more immediate and contextually relevant digital experiences.
Viewers can discover, watch, interact and share interesting pieces
of content more freely, as well as access relevant merchandising
and e-commerce opportunities from directly within SEEEN's video
player.
Market Direction . Video Micro-Moments capitalizes on current
sharing trends (more than 92 percent of mobile video viewers share
video with others) and has the potential for viral sharing, which
would drive a large volume of qualified traffic to SEEEN partner
websites. In this vein, Micro-Moments take on the character of
content sharing platforms like Pinterest, Instagram and TikTok.
With Promoted Micro-Moments, like Promoted Pinterest Pins,
advertising and editorial content have the same format, which can
be published, promoted on SEEEN's owned and operated websites, like
GTChannel.com, and shared across social networks and messaging
platforms.
SEEEN Offerings Readied: Battle testing products with customers
during 3Q
As mentioned above, CreatorSuite leverages JetStream, the
Company's patented human-in-the-loop AI technology. CreatorSuite
benefits transcend operational efficiency, automating the
previously tedious and labor intensive tasks of creating and
publishing hyperlinked video. CreatorSuite proposes Micro-Moments
to customers. Micro-Moments are shorter, data derivative
subsegments of a full video that serve as building blocks around
which SEEEN's customers deliver richer, more immediate and
contextually relevant digital experiences. CreatorSuite powered
websites and microsites enable viewers to discover, watch, interact
and share interesting parts of video content more freely, as well
as access relevant merchandising and e-commerce opportunities from
directly within SEEEN's video player.
CreatorSuite also features a distributed promotion and
syndication functionality that enables website publishers in the
SEEEN Network of content sites to serve interactive Micro-Moment
content that is targeted to the site content and audience. These
Micro-Moments are administered, sorted and maintained by SEEEN via
the CreatorSuite program. Website publishers can customize and
control their promotions with dedicated Micro-Moments. The
Micro-Moments drive reach, improve rank, expand engagement and
increase yield from conversions. SEEEN's launch partners
experienced significant increases in: organic traffic (more than
37%); average watch duration (up to 3 times better); click through
rates (6% compared to 0.6% standard for video ads according to Q1
Adstage data); and product conversion rate to 9.6% (2% is the
eCommerce standard).
Content is at the heart of the GTChannel experience and
GTChannel's new CreatorSuite DXP-powered O&O is the Group's
first Internet channel designed to showcase not only automotive
video content and Micro-Moments from GTChannel and our affiliated
creators but also our technology and product offerings.
GTChannel.com, provides automotive enthusiasts with a richer user
experience because it delivers more targeted content, and our fans
can discover, interact and share relevant Micro-Moments freely, as
well as accessing relevant merchandise and events directly from our
video player. The strength of targeted viewer engagement also
allows us to deliver more targeted audiences to our partners. The
Company sees gtchnnel.com as a blueprint for other creators who
want to launch breakout digital experiences.
JetStream is our multi-tenant, real-time video stream processing
platform, an essential piece of infrastructure and the backbone of
SEEEN's data-driven approach to video reimagined. JetStream
supports the Groups needs for multimodal, ensemble processing of
vision, language and sequence understanding workloads. JetStream
accepts a video as input and then performs video analysis,
enrichment and linking functions, annotating the video content with
concepts, using those annotations to (semi-) automatically link
parts of the audio visual content to other Web content for
consumption by downstream applications like CreatorSuite. We are in
discussions to sell JetStream directly, where our customers'
require this, as opposed to the full CreatorSuite solution.
CreatorSuite consumes data and insights from a JetStream
endpoint so that it can then provide an interactive curatorial
experience to the user. The act of verifying and extending
JetStream's machine predictions are fed back to the JetStream
platform so that the whole system gets smarter. JetStream is also
the core of our "Micro-Moments Factory" and we're delighted that
enterprise customers also see value in the operational efficiencies
it delivers and the insights they can leverage from the massive
amount of structured media metadata it generates.
Data from deployments
We have highly positive results from current CreatorSuite
deployments (measured by SEEEN's analytics tools), which directly
impact the KPIs used by companies of all sizes to measure their
digital marketing results. A summary of these results is below:
Reach and Rank
-- Organic traffic driven to websites increased by 35%
-- Keyword discoverability - At GTChannel.com, more than 50% of
keywords rank for video against industry standards below 10%,
driving increased SERP ranking for important keywords. SEEEN's
CreatorSuite-powered Syndication Widgets have also driven improved
ranking for our external clients.
-- Number of index entries multiplied by more than 10 times, as
each Micro Moment is indexed for organic, image and video
search.
Engagement
-- Significant increases in Average Session Duration, including
a trebling on gtchannel.com to more than 5 minutes per visit
(industry standard of 2-3 minutes)
-- Decrease in Bounce Rate to:
-- below 30% for gtchannel.com (Autos & Vehicles benchmark: more than 50%)
-- below 0.1% for Syndication Widgets
Conversion
-- Clickthrough rates as high as 6% versus video average of approximately 0.6%
Brand awareness
-- Enhanced surface area for brands online by exposing branded
Micro-Moments to a larger audience of information seekers via
Google organic, image, and video SERP features.
Sales Pipeline
Each type of prospect requires a different sales strategy. For
larger enterprises, who require more bespoke solutions, we interact
directly with the key decision makers. We already have conducted
pilots for some customers and we are now targeting signing formal
commercial agreements in the near term. These agreements are
expected to result in significant deal flow for SEEEN, delivering
high-margin, monthly recurring revenue ("MRR"). Using the data
analytic insights from early customer engagements, we will focus on
aggressively expanding our sales pipeline both within and outside
of our core automotive vertical.
For smaller and medium sized businesses and individual video
creators (including our MCN channel partners), we are offering a
standard package-driven CaaS DXP offering with pricing based on
functionality required. Armed with insights from our customers, our
team at GTChannel will market CreatorSuite to YouTube creators,
both within our MCN and more widely. Our MCN includes more than
10,000 affiliated creators. In total, there are 31m YouTube
Channels, 16,000 of which have more than 1m subscribers. Each of
these creators will benefit from using CreatorSuite to make their
content more discoverable and monetizable on the Internet and
across social and messaging platforms.
1H Financials
During 1H 2020, the MCN continued the fast growth of both its
viewer base and number of channel partners. Total views on the MCN
grew by 30% against 1H 2019 to 8.4 billion. This is almost as many
views as the MCN generated in the entirety of 2018 (8.5 billion),
demonstrating the ongoing rapid growth of the MCN.
However, during 1H 2020, COVID-19 had a significant impact on
the monetization of our MCN business. Despite the view growth
above, overall net revenues for the period declined by 22% to $3.7
million. This was entirely driven by a 40% fall in RPM (revenue per
1,000 videos viewed) to $0.78, which was directly caused by a
contraction in advertising budgets. This decline in advertising
budgets, and income for both the MCN and its video creator
partners, has further highlighted the need to diversify MCN and
video creator partner revenue streams with a focus on driving
non-YouTube revenue.
Against this background, the launch of CreatorSuite, coupled
with some improvement in digital advertising budgets, has improved
MCN performance since 30 June 2020. RPMs have improved to
approximately $1.00 since 30 June 2020, which has resulted in
revenues increasing by approximately 20% compared with the same
period last year. We believe that this positive trajectory for
revenues and RPM will continue as we sign up creator partners to
CreatorSuite. This brings two benefits to the MCN and the Group:
(i) it lessens dependence on digital advertising on YouTube to
generate income from videos at a time when advertising budgets are
uncertain; and (ii) improves the analysis of video inventory,
allowing for more targeted advertising against videos on YouTube
and other platforms, which will result in higher RPM.
Despite the above COVID-19 driven decline in MCN revenues during
the period, the Group has maintained a strong focus on both cash
management and operating expenditure. As a result, SEEEN is on
track to meet market expectations for Adjusted Profit before Tax.
In particular, we have our core "Go-To- Market" team in place to
execute on both our sales pipeline and product roll-out. Future
hires will typically be linked directly to committed customer
contracts, especially where bespoke solutions might be
required.
We have continued to invest the EIS/VCT proceeds from our IPO
last year to deliver our product roadmap. During the period, we
capitalized approximately $980,000 of development spend. As noted
above, the market demand for our products has been accelerated by
COVID-19 and we have already launched pilots to exploit our
proprietary technology.
During the remainder of 2020, we will continue to develop new
products, such as JetStream, and deliver constant improvements to
existing products, driven by different customer use cases. The
technology sales from this development expenditure are typically
structured as recurring SaaS income as opposed to one-off licence
sales. These are high margin sales and as a result, will have a
significant positive impact on our ongoing Profit before Tax,
delivering significant operating leverage.
Finally, our strong cash position of more than $7.2 million as
at 30 June 2020 provides us with enough cash to execute on our
clear plans. As we execute on our sales pipeline and drive
additional income from the deployment of products into our MCN, our
plan calls for the Group to achieve cash breakeven during 3Q
2021.
Conclusion
We have made good progress against our "Go-To-Market" strategy
with our technology and product implementation demonstrating strong
results for both gtchannel.com and third party customers. During
Q4, we will build on and leverage these results to execute further
commercial agreements as customers clearly see the benefits of
reimagining video usage to drive better user experiences and
greater profits. In particular, our work on gtchannel.com is a
blueprint for creators, brands and enterprises who are looking for
a more modern way to manage and publish enriched video content
across multiple platforms.
We look forward to updating the market on the impact of our
technology on our MCN and on account wins during Q4. These wins
will transform the economics of our business from the legacy MCN
model to a recurring revenue, high margin technology model capable
of benefiting customers of all sizes and in all vertical
markets.
Todd Carter
CEO
September 30, 2020
Interim Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2020
Six months Six months Year ended
ended ended 31
30 June 30 June December
2020 2019 2019
------------------------------------ ------ -------------- ------------ -------------
Notes $ $ $
------------------------------------ ------ -------------- ------------ -------------
Unaudited Unaudited Unaudited
Revenue 3 3,715,649 - 4,288,004
Cost of sales (3,301,879) - (3,851,924)
------------------------------------ ------ -------------- ------------ -------------
Gross profit 413,770 - 436,080
Administrative expenses
* Share-based payments (254,783) - (156,650)
* Amortisation of intangibles (595,124) - (297,562)
* Other administrative costs (1,523,853) (221,324) (1,996,261)
------------------------------------ ------ -------------- ------------ -------------
Total administrative
expenses (2,373,760) (221,324) (2,450,473)
------------------------------------ ------ -------------- ------------ -------------
Operating loss (1,959,990) (221,324) (2,014,393)
Finance (expense)
/ income (3,319) 1,752 (1,505)
------------------------------------ ------ -------------- ------------ -------------
Loss before tax 3 (1,963,309) (219,572) (2,015,898)
Taxation 116,376 - 58,189
Loss for the period (1,846,933) (219,572) (1,957,709)
Other comprehensive
income
Exchange differences
arising on translation
of foreign operations (470,603) (3,397) 578,502
Total comprehensive
loss for the period (2,317,536) (216,175) (1,379,207)
------------------------------------ ------ -------------- ------------ -------------
Earnings per share Cents Cents Cents
------------------------------------ ------ -------------- ------------ -------------
Basic 6 (3.6) (7.2) (13.1)
------------------------------------ ------ -------------- ------------ -------------
Diluted 6 (3.6) (7.2) (13.1)
------------------------------------ ------ -------------- ------------ -------------
Note:
The results for the 6 months ended 30 June 2020 include the
figures for the Group as enlarged by the acquisitions made on 30
September 2019.
The results for the 6 months ended 30 June 2019 include the
figures for the Company without any of its subsidiaries and the
results for the 12 months ended 31 December 2019 only include the
Company's subsidiaries from the period from 30 September 2019.
As such, the comparisons between the results for the six months
to 30 June 2020 and the other reported results are not
meaningful.
Consolidated Statement of Financial Position as at 30 June
2020
At At At
30 June 30 June 31 December
2020 2019 2019
------------------------------ ------ ------------ ---------- -------------------
Notes $ $ $
------------------------------ ------ ------------ ---------- -------------------
Unaudited Unaudited Audited
ASSETS
Non-current assets
Goodwill 9,762,158 - 9,762,158
Other intangible assets 4,943,565 - 4,558,226
Other receivables 1,800 - 1,800
------------------------------ ------ ------------ ---------- -------------------
14,707,523 - 14,322,184
------------------------------ ------ ------------ ---------- -------------------
Current assets
Trade and other receivables 4 1,110,090 - 1,814,257
Cash and cash equivalents 7,252,233 1,292,878 9,760,905
------------------------------ ------ ------------ ---------- -------------------
8,362,323 1,292,878 11,575,852
------------------------------ ------ ------------ ---------- -------------------
TOTAL ASSETS 3 23,069,846 1,292,878 25,897,346
------------------------------ ------ ------------ ---------- -------------------
EQUITY AND LIABILITIES
Equity attributable
to holders of the parent
Share capital 7,400,732 482,092 7,400,732
Share premium 7,677,993 1,438,523 7,677,993
Merger reserve 8,989,501 - 8,989,501
Share based payment
reserve 411,433 - 156,650
Foreign exchange reserve 46,937 (60,962) 517,540
Retained profit (4,357,774) (599,775) (2,510,841)
------------------------------ ------ ------------ ---------- -------------------
20,168,822 1,259,878 22,231,575
------------------------------ ------ ------------ ---------- -------------------
Non-current liabilities
Deferred tax liability 1,117,584 - 1,233,960
------------------------------ ------ ------------ ---------- -------------------
1,117,584 - 1,233,960
------------------------------ ------ ------------ ---------- -------------------
Current liabilities
Trade and other payables 4 1,585,440 33,000 2,431,811
Borrowings 5 198,000 - -
1,783,440 33,000 3,665,771
------------------------------ ------ ------------ ---------- -------------------
TOTAL EQUITY AND LIABILITIES 23,069,846 1,292,878 25,897,346
------------------------------ ------ ------------ ---------- -------------------
Interim Consolidated Statement of Changes in Equity
For the six months ended 30 June 2020
Share Share Merger Share Foreign Retained Total
Capital Premium Reserve based Exchange Profit
payment Reserve
Reserve
$ $ $ $ $ $ $
---------------------- ---------- ------------ ---------- --------- ---------- ------------ ------------
As at 31 December
2018 482,092 1,438,523 - - (57,565) (380,203) 1,482,657
Loss for the period - - - - - (219,572) (219,572)
Other comprehensive
income - - - - (3,397) - (3,397)
As at 30 June 2019 482,092 1,438,523 - - (60,962) (599,775) 1,259,878
---------------------- ---------- ------------ ---------- --------- ---------- ------------ ------------
Issue of ordinary
shares 6,918,640 7,655,061 8,989,501 - - - 23,563,202
Share issuance costs - (1,415,591) - - - (172,929) (1,588,520)
Share-based payment
expense - - - 156,650 - - 156,650
Loss for the period - - - - - (1,738,137) (1,738,137)
Other comprehensive
loss - - - - 578,502 - 578,502
As at 31 December
2019 7,400,732 7,677,993 8,989,501 156,650 517,540 (2,510,841) 22,231,575
---------------------- ---------- ------------ ---------- --------- ---------- ------------ ------------
Share-based payment
expense - - - 254,783 - - 254,783
Loss for the period - - - - - (1,846,933) (1,846,933)
Other comprehensive
income - - - - (470,603) - (470,603)
---------------------- ---------- ------------ ---------- --------- ---------- ------------ ------------
As at June 2020 7,400,732 7,677,993 8,989,501 411,433 46,937 (4,357,774) 20,168,822
---------------------- ---------- ------------ ---------- --------- ---------- ------------ ------------
Interim Consolidated Statement of Cash Flows
For the six months ended 30 June 2020
Six months Six months Year ended
ended ended 31 December
30 June 30 June 2019
2020 2019
-------------------------------------------- ------------ ----------- -------------
$ $ $
-------------------------------------------- ------------ ----------- -------------
Unaudited Unaudited Unaudited
Cash flows from operating activities
Loss before tax (1,963,309) (219,572) (2,015,898)
Adjustments for non-cash/non-operating
items:
Amortisation of intangible assets 595,124 - 297,562
Share based payments 254,783 - 156,650
Interest paid / (received) 3,319 (1,752) 1,505
Operating cash flows before movements
in working capital (1,110,083) (221,324) (1,560,181)
-------------------------------------------- ------------ ----------- -------------
(Increase) / decrease in trade and other
receivables 704,167 - (717,311)
(Decrease) / increase in trade and other
payables (846,371) (18,264) 967,602
Cash generated by operations (1,252,287) (239,588) (1,309,890)
-------------------------------------------- ------------ ----------- -------------
Income taxes - - -
-------------------------------------------- ------------ ----------- -------------
Net cash used in operating activities (1,252,287) (239,588) (1,309,890)
-------------------------------------------- ------------ ----------- -------------
Cash flows from investing activities
Purchase of intangibles (980,462) - (94,794)
Cash on acquisition - - 83,587
Net cash used in investing activities (980,462) - (11,207)
-------------------------------------------- ------------ ----------- -------------
Cash flows from financing activities
Issue of ordinary share capital - - 2,923,306
Premium on issue of ordinary share capital - - 7,655,060
Share issuance costs set against share
premium and retained earnings - - (1,588,519)
Proceeds from borrowings 198,000 - -
Interest received / (paid) (3,319) 1,752 (3,257)
Net cash generated by/(used in) financing
activities 194,681 1,752 8,986,590
-------------------------------------------- ------------ ----------- -------------
Net (decrease)/increase in cash and cash
equivalents (2,038,067) (237,836) 7,665,493
Effect of exchange rates on cash (470,604) (9,416) 552,282
Cash and cash equivalents at the beginning
of period 9,760,905 1,540,130 1,540,130
Cash and cash equivalents at end of period 7,252,233 1,292,878 9,760,905
-------------------------------------------- ------------ ----------- -------------
Notes to the Interim Consolidated Financial Information
for the six months ended 30 June 2020
1 General information
The Group is a global social media and technology platform for
sharing video micro-moments to enable discovery, sharing and
e-commerce through the targeting and connecting of creators,
audiences and brands.
The Company is a public limited company domiciled in the United
Kingdom and incorporated under registered number 10621059 in
England and Wales. The Company's registered office is 27-28
Eastcastle Street, London W1W 8DH.
Given the timing of the acquisition of SEEEN, Inc, GTChannel,
Inc and Tagasauris, Inc by the Company on 30 September 2019, the
comparison between the results for the six months to 30 June 2020
and for each of the six months to 30 June 2019 and the twelve
months to 31 December 2019 is not meaningful.
2 Significant accounting policies
Basis of preparation and changes to the Group's accounting
policies
The accounting policies adopted in the preparation of the
interim consolidated financial information are consistent with
those of the preparation of the Group's annual consolidated
financial statements for the period ended 31 December 2019. No new
IFRS standards, amendments or interpretations became effective in
the six months to 30 June 2020.
Statement of compliance
This interim consolidated financial information for the six
months ended 30 June 2020 has been prepared in accordance with IAS
34, 'Interim financial reporting' as adopted by the European Union
and the AIM Rules of UK companies. This interim consolidated
financial information is not the Group's statutory financial
statements and should be read in conjunction with the annual
financial statements for the period ended 31 December 2019, which
have been prepared in accordance with International Financial
Reporting Standards (IFRS as adopted by the European Union) and
have been delivered to the Registrar of Companies. The auditors
have reported on those accounts; their report was unqualified, did
not include references to any matters to which the auditors drew
attention by way of emphasis of matter without qualifying their
report and did not contain statements under section 498(2) or (3)
of the Companies Act 2006.
The interim consolidated financial information for the six
months ended 30 June 2020 is unaudited. In the opinion of the
Directors, the interim consolidated financial information presents
fairly the financial position, and results from operations and cash
flows for the period. Comparative numbers for the six months ended
30 June 2019 are unaudited.
This interim consolidated financial information is presented in
US Dollars ($), rounded to the nearest dollar.
Foreign currencies
Functional and presentational currency
Items included in this interim consolidated financial
information are measured using the currency of the primary economic
environment in which each entity operates ("the functional
currency") which is considered by the Directors to be Pounds
Sterling (GBP) for the Parent Company and US Dollars ($) for all
the Company's subsidiaries. This interim consolidated financial
information has been presented in US Dollars which represents the
dominant economic environment in which represents the dominant
economic environment in which the Group operates. The effective
exchange rate at 30 June 2020 was GBP1 = US$1.2628 (30 June 2019:
GBP1 = US$1.2939 and 31 December 2019: GBP1: US$1.3118).
Critical accounting estimates and judgments
The preparation of interim consolidated financial information
requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported
amounts of assets and liabilities and the reported amounts of
income and expenses during the reporting period. Although these
estimates are based on management's best knowledge of current
events and actions, the resulting accounting estimates will, by
definition, seldom equal the related actual results.
In preparing this interim consolidated financial information,
the significant judgements made by management in applying the
Group's accounting policies and the key sources of estimation
uncertainty were the same as those that applied to the consolidated
financial statements for the year ended 31 December 2019, together
with the recognition of development expenditure, described
below.
Development expenditure
The Group recognises costs incurred on development projects as
an intangible asset which satisfies the requirements of IAS 38. The
calculation of the costs incurred includes the percentage of time
spent by certain employees and contractors on relevant development
projects. The decision whether to capitalise and how to determine
the period of economic benefit of development projects requires an
assessment of the commercial viability of the projects and the
prospect of selling the project to new or existing customers.
During the period, the Group capitalized $980,462 of development
expenditure.
Going Concern
The directors have a reasonable expectation that the Group has
adequate resources to continue operating for the foreseeable
future, and for this reason they have adopted the going concern
basis of preparation in the consolidated interim financial
statements.
3 Segmental information
The Group generated all its revenue in the period from one
customer, YouTube, a wholly owned subsidiary of Google. All
revenues are generated in the USA.
No additional disaggregated information is provided on the basis
that the business is managed as one operation by the determination
of the CEO, who is the Chief Operating Decision Maker.
4 Trade Payable and Receivables
The majority of trade payables and receivables relate to
receivables from YouTube and payables to creator partners. In
addition, trade and other payables includes accruals for expenses
to be accrued during the year, payments to consultants who are paid
monthly in arrears and historic liabilities of the acquired
businesses that relate to payables more than two years ago and the
Group does not expect to need to pay.
5 Borrowings
All borrowings relate to the Paycheck Protection Program (PPP).
The PPP brings much needed relief to business owners in the United
States affected by the coronavirus. Not only does this loan program
provide funding to maintain payroll and other expenses, but if used
for qualifying purposes, part or all of the loan can be forgiven.
SEEEN, Inc applied for and received funding of $198,000 under this
program in April 2020. Final rules for applying for forgiveness
have not been released as of the report date. Management expects
that the total funding will be forgiven given that, among other
things, payroll and expenses have been maintained.
6 Earnings per share
The earnings per share has been calculated using the profit for
the period and the weighted average number of ordinary shares
outstanding during the period, as follows:
Six months Six months Year ended
ended ended 31 December
30 June 2020 30 June 2019 2019
Unaudited Unaudited Unaudited
-------------------------- ---------------- ---------------- --------------
Earnings attributable
to shareholders of
the Company ($) (1,846,993) (270,017) (1,957,710)
Weighted average number
of ordinary shares 49,957,876 3,041,666 14,995,659
Diluted weighted average
number of ordinary
shares 49,957,876 3,041,666 14,995,659
--------------------------- ---------------- ---------------- --------------
Earnings per share
(cents) (3.6) (7.2) (13.1)
--------------------------- ---------------- ---------------- --------------
Diluted earnings per
share (cents) (3.6) (7.2) (13.1)
--------------------------- ---------------- ---------------- --------------
7 Publication of announcement and the Interim Results
A copy of this announcement will be available at the Company's
registered office (27-28 Eastcastle Street, London, W1W 8DH) from
the date of this announcement and on its website - seeen.com . This
announcement is not being sent to shareholders.
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.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR BKLLLBKLXBBX
(END) Dow Jones Newswires
September 30, 2020 02:00 ET (06:00 GMT)
Entertainment Ai (LSE:EAI)
Historical Stock Chart
From Apr 2024 to May 2024
Entertainment Ai (LSE:EAI)
Historical Stock Chart
From May 2023 to May 2024