TIDMMOS
RNS Number : 0764B
Mobile Streams plc
31 March 2017
31 March 2017
Mobile Streams plc ("Mobile Streams" or the "Company") (AIM:
MOS)
Half yearly report
Mobile Streams is pleased to announce its unaudited interim
results for the six months ended 31 December 2016.
Highlights
-- Subscriber numbers in India increased to over 175,000 active
subscribers* (up from 100,000 at the period end)
-- Successful fundraising of GBP2.2m (before expenses) to fund growth in India
-- GBP2.8m of cash and cash equivalents at 31 December 2016 (31
December 2015: GBP1.5m), with no debt. The Company's current cash
balance is GBP2.6m
-- Revenues of GBP3.6m (H1 2015: GBP8m). All revenue is from continuing operations
-- Mobile Internet revenues were GBP3.58m (6 months ended 31 December 2015: GBP7.9m)
-- EBITDA** loss of GBP712k in line with management expectations
(6 months ended 31 December 2015: GBP104k loss)
-- Post-tax loss of GBP879k in line with management expectations
(6 months to 31 December 2015: GBP321k loss)
-- Launch of HTML5 browser based games service to complement its
app download service in India (post-period end)
* Active subscribers are measured as consumers who have made a
purchase from the Company in the country in the past 60 days. For
like-for-like comparability, this is the same methodology the
Company uses to measure subscribers in its other markets such as
Argentina
** Earnings before interest, tax, depreciation, amortisation and
share compensation ("EBITDA") is a non IFRS measure which the Group
uses to assess its performance. It is defined as earnings before
interest, tax, depreciation, amortisation and share
compensation.
Commenting, Simon Buckingham, CEO of Mobile Streams said: "The
successful fundraising of GBP2.2 million (before expenses)
completed at the end of the period is enabling us to accelerate our
strategy of building subscribers and revenues in the Indian market
during calendar year 2017. Whilst Argentina remains a challenging
place to do business, we expect India to continue to grow steadily
throughout 2017 as we focus on and invest in the market. It is
particularly pleasing that we have surpassed the 175,000 subscriber
mark so quickly and we look forward to updating shareholders on our
progress at the appropriate time."
Enquires:
Mobile Streams
Simon Buckingham, Chief Executive Officer +1 347 669 9068
Enrique Benasso, Chief Financial Officer
N+1 Singer (Nominated Adviser and Broker)
Alex Price +44 20 7496 3000
Alex Laughton Scott
India
Mobile Streams India Private Limited exceeded the important
milestone of reaching 100,000 active subscribers to its
MobileGaming.com games subscription service by 31 December 2016, a
figure which has subsequently grown to over 175,000 active
subscribers.
In India, most of the growth in active subscribers to date has
been driven by subscription growth enabled by its direct billing
connections with two of the three largest local mobile phone
operators. The Company is working to add additional direct billing
connections for the one remaining local top three network operator
as well as to two additional local Indian mobile network operators,
each with approximately 100 million subscribers.
Post-period end the Company launched its browser based games
service to compliment its app download service in India. This HTML5
based service has gone live with billing connectivity from its
largest partner, with another large partner scheduled to launch
before the end of the current financial year.
Argentina
As previously announced, trading in Argentina continued to be
challenging throughout the first half of the current financial year
as a result of general market conditions and regulation in the
local market for mobile content subscriptions. These conditions are
expected to remain in place during the remainder of the financial
year and beyond.
OPERATING REVIEW
Mobile internet
The Group anticipated the shift to the open Mobile Internet
business model several years ago and added new products at new
price points in new markets, which includes basically the start-up
in India during the last fiscal year.
The mobile internet business model (based on Mobile Internet)
shifted to a model based on the operator platforms and the revenue
based on internet decreased. This was mostly the result of the
economic conditions in Argentina which includes the devaluation of
the Argentine peso during the last 2 years, resulting in a fall in
sales.
During the first half of the year, Latin America, primarily
Argentina, accounted for the majority of revenues, as during the
last years.
Mobile operators
The Group has several contracts with mobile operators that allow
the distribution of content through their mobile portals, although
the revenue has been reduced by more than 56% year on year
partially because of the fact that consumers prefer to use the open
mobile internet services on their smartphones and partly because of
our own increased focus on Mobile Internet services.
There was a reduction in the number of consumer visitors to
these portals, which has been a continuing trend for several years.
Our teams share and implement the best retailing practices in order
to increase the conversion of visitors into customers to mitigate
the natural decline in this revenue stream as the market
changes.
FINANCIAL REVIEW
For the 6 months ended 31 December 2016.
Gross profit for the six month period ended 31 December 2016 was
GBP1.1m (2015: GBP2.1m). Gross margin was 29.6%, up from 25.9% in
2015.
Mobile Internet revenue has decreased by 54.7% to GBP3.58m
(2015: GBP7.9m). The cost of sales on mobile internet revenue is
much higher than on operator revenue because of marketing costs
resulting in a lower overall gross profit margin.
The Group recorded a loss after tax of GBP879k for the 6 months
ended 31 December 2016 (2015: loss GBP321k), generating a loss per
share of 2.175 pence per share (2015: 0.865 pence loss per
share).
Adjusted loss per share (excluding depreciation, amortisation,
impairments and share compensation expense) was 1.9 pence per share
(2015: 0.674 pence adjusted loss per share).
Cash and cash equivalents
The Argentine peso remained stable during the semester, caused
by the release of currency restrictions, meaning that currency can
now flow freely in and out of Argentina. This policy was adopted by
the country's new elected president in November 2015. Current cash
balances are GBP2.8m.
Capital fundraising
The fundraising of GBP2.2 million gross proceeds (GBP2 million
net proceeds) completed at the end of December 2016 is enabling us
to both continue and also accelerate our strategy of building
subscribers and revenues in the Indian market during calendar year
2017.
Outlook
Whilst Argentina remains a challenging place to do business, the
Directors expect subscriber numbers in India to continue to grow
steadily throughout 2017 as the Group focuses on and invests in
that market.
Marketing investment in India, funded by the recent issue of
shares for cash, has been growing during the past half year and is
expected to continue growing. The Company looks forward to updating
shareholders on its progress at the appropriate time.
Argentina remains a difficult market but with more focus on a
key local mobile operator and with market knowledge acquired during
past few years, the Directors are optimistic about being able to
stabilise the position in that region.
Overall the Board expects the rest of 2017 to see continued
investment as the Company looks to build a strong position in
India.
CONSOLIDATED INCOME STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
ended 31 ended 31 ended 30
December December June
2016 2015 2016
GBP000's GBP000's GBP000's
Revenue 3,640 8,033 12,786
Cost of sales (2,563) (5,948) (9,256)
------------------------------------- ----------- ----------- -----------
Gross profit 1,077 2,085 3,530
Selling and marketing costs (349) (771) (1,333)
Administrative expenses ** (1,549) (1,489) (3,048)
Operating Loss (821) (175) (851)
Finance income 78 47 118
Finance expense (2) (13) (4)
----------- ----------- -----------
Loss before tax (745) (141) (737)
Tax expense (134) (180) (569)
Loss for the period (879) (321) (1,306)
===================================== =========== =========== ===========
Attributable to:
Attributable to equity shareholders
of Mobile Streams Plc (879) (321) (1,306)
===================================== =========== =========== ===========
Earnings Per Share
Pence per Pence per Pence per
share share share
Basic loss per share (2,167) (0,865) (3,519)
Diluted loss per share (2,167) (0,865) (3,519)
* *Administrative expenses include depreciation, amortisation,
impairment and share based compensation.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
6 months 6 months 12 months
ended 31 ended ended
December 31 December 30 June
2016 2015 2016
GBP000's GBP000's GBP000's
Loss for the period (879) (321) (1,306)
Exchange differences on translating
foreign operations 74 (822) (1,017)
Total comprehensive loss for the
period (805) (1,143) (2,323)
===================================== =========== ============== ===========
Total comprehensive loss for the
period attributable to:
Equity shareholders of Mobile
Streams Plc (805) (1,143) (2,323)
------------------------------------- ----------- -------------- -----------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
6 months ended 6 months ended 12 months
ended
31 December 31 December 30 June 2016
2016 2015
GBP000's GBP000's GBP000's
Assets
Non- Current
Intangible assets - 1 -
Property, plant and equipment 8 52 20
Deferred tax asset 189 - 189
---------------- ---------------- --------------
197 53 209
Current
Trade and other receivables 1,870 3,307 2,576
Cash and cash equivalents 2,780 1,512 1,367
4,650 4,819 3,943
Total assets 4,847 4,872 4,152
================================= ================ ================ ==============
Equity
Equity attributable to equity
holders of Mobile Streams
Plc
Called up share capital 1,164 74 74
Share Premium 11,482 10,579 10,579
Translation reserve (3,076) (2,955) (3,150)
Retained earnings (6,723) (5,059) (5,943)
-------------------------------- ---------------- ----------------
Total equity 2,847 2,639 1,560
--------------------------------- ---------------- ---------------- --------------
Liabilities
Current
Trade and other payables 1,463 1,607 1,595
Current tax liabilities 537 626 997
-------------------------------- ---------------- ---------------- --------------
2,000 2,233 2,592
Total liabilities 2,000 2,233 2,592
-------------------------------- ---------------- ---------------- --------------
Total equity and liabilities 4,847 4,872 4,152
================================= ================ ================ ==============
CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
ended 31 ended 31 ended 30
December December June
2016 2015 2016
GBP000's GBP000's GBP000's
Operating activities
Profit before taxation (745) (141) (737)
Adjustments:
Shared based payments 97 44 146
Depreciation 14 27 59
Interest received (78) (47) (118)
Changes in Trade and other receivables 706 709 304
Changes in Trade and other payables (132) (483) 13
Tax Paid (460) (219) (237)
Interest paid (2) (13) -
Total cash utilised in operating
activities (600) (123) (570)
----------------------------------------- ----------- ----------- -----------
Investing Activities
Additions to property, plant
and equipment (1) (1) (8)
Interest received 78 47 118
Net Cash generated from investing
activities 77 46 110
----------------------------------------- ----------- ----------- -----------
Issue of share capital (net of
expenses paid) 1,993 - -
Net Cash generated from financing
activities 1,993 - -
----------------------------------------- ----------- ----------- -----------
Net change in cash and cash equivalents 1,470 (77) (460)
Cash and cash equivalents at
beginning of period 1,367 2,098 2,098
Exchange (loss)/ gain on cash
and cash equivalents (57) (509) (271)
Cash and cash equivalents, end
of period 2,780 1,512 1,367
----------------------------------------- ----------- ----------- -----------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Called Share Translation Retained Total
up share premium reserve earnings Equity
capital
GBP000's GBP000's GBP000's GBP000's GBP000's
Balance at 1
July 2015 74 10,579 (2,133) (4,782) 3,738
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Credit for
share based
payments - - - 44 44
Transactions
with owners - - - 44 44
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Loss for the 6
months ended
31 December
2015 - - - (321) (321)
Exchange
differences
on
translating
foreign
operations - - (822) - (822)
Total
comprehensive
income
for the
period - - (822) (321) (1,143)
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Balance at 31
December 2015 74 10,579 (2,955) (5,059) 2,639
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Balance at 1
January 2016 74 10,579 (2,955) (5,059) 2,639
Credit for
share based
payments - - - 101 101
Transactions
with owners - - - 101 101
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Loss for the 6
months ended
30 June 2016 - - - (985) (985)
Exchange
differences
on
translating
foreign
operations - - (195) - (195)
Balance at 30
June 2016 74 10,579 (3,150) (5,943) 1,560
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Balance at 1
July 2016 74 10,579 (3,150) (5,943) 1,560
Credit for
share based
payments - - - 97 97
Transactions
with owners - - - 97 97
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Loss for the 6
months ended
31 December
2016 - - - (879) (879)
Exchange
differences
on
translating
foreign
operations - - 74 - 74
Issue of share
capital (net
of expenses
paid) 1,090 903 - - 1,993
Total
comprehensive
income
for the
period - - 74 (879) (805)
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
Balance at 31
December 2016 1,164 11,482 (3,076) (6,725) 2,845
--------------- ------------------ --------------------- ----------------------- ------------------- ---------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The interim results of Mobile Streams PLC are prepared in
accordance with the requirements of IAS 34 Interim Financial
Reporting as adopted by the EU and prepared in accordance with the
accounting policies set out in the last financial statements for
the 12 months ended 30 June 2016.
The interim results, which are not audited, do not comprise
statutory accounts within the meaning of section 434 of the
Companies Act 2006.
The comparative financial information for the 12 months ended 30
June 2016 has been extracted from the statutory accounts for that
period. In addition, the financial information for the 6 months
ended 31 December 2016 has been extracted from the unaudited
Interim results. The full audited accounts of the Group for the 12
months ended 30 June 2016 were 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 auditor's report on these financial statements was
unqualified and did not contain statements under S498(2) or S498(3)
of the Companies Act 2006.
2. SEGMENT REPORTING
As at 31 December 2016, the Group was organised into 4
geographical segments: Europe, North America, Latin America, and
Asia Pacific. Revenues were from external customers only and
generated from three principal business activities: the sale of
mobile content through MNO s (Mobile Operator sales), the sale of
mobile content over the internet (Mobile Internet sales) and the
provision of consulting and technical services (Other Service
Fees).
All operations are continuing and all inter-segment transfers
are priced and carried out at arm's length.
The segmental results for the 6 months ended 31 December 2016
were as follows:
GBP000's Europe Asia North America Latin America Group
Mobile operator sales 17 - 35 - 52
Mobile internet sales - 113 2 3,466 3,581
Other service fees 6 - 1 - 7
---------------------------- ------- ------ -------------- -------------- --------
Total Revenue 23 113 38 3,466 3,640
Cost of sales (9) (81) (6) (2,467) (2,563)
---------------------------- ------- ------ -------------- -------------- --------
Gross profit 14 32 32 999 1,077
Operating expenses (297) (147) (73) (1,272) (1,789)
---------------------------- ------- ------ -------------- -------------- --------
EBITDA* (283) (115) (41) (273) (712)
---------------------------- ------- ------ -------------- -------------- --------
Depreciation, amortisation - - - (14) (14)
Share based compensation (97) - - - (97)
Finance income - - - 77 77
---------------------------- ------- ------ -------------- -------------- --------
Profit/(Loss) before
tax (380) (115) (41) (210) (746)
Income tax expense (84) - - (49) (133)
---------------------------- ------- ------ -------------- -------------- --------
Profit/(Loss) after
tax (464) (115) (41) (259) (879)
*Calculated as profit before tax, interest, amortization, depreciation,
share compensation expense and impairment of assets.
The segmental results for the 6 months ended 31 December 2015
were as follows:
GBP000's Europe Asia North America Latin America Group
Mobile operator sales 8 5 19 80 112
Mobile internet sales - - 4 7,901 7,905
Other service fees 15 - - 1 16
------------------------------ ------- ----- -------------- -------------- --------
Total Revenue 23 5 23 7,982 8,033
Cost of sales (40) (14) (10) (5,884) (5,948)
------------------------------ ------- ----- -------------- -------------- --------
Gross profit / (loss) (17) (9) 13 2,098 2,085
Operating expenses (291) (86) (70) (1,742) (2,189)
------------------------------ ------- ----- -------------- -------------- --------
EBITDA* (308) (95) (57) 356 (104)
------------------------------ ------- ----- -------------- -------------- --------
Depreciation, amortisation - - - (27) (27)
Share based compensation (44) - - - (44)
Revenue/expense intercompany 238 - - (238) -
Finance income - - 1 33 34
------------------------------ ------- ----- -------------- -------------- --------
Profit/(Loss) before tax (114) (95) (56) 124 (141)
Income tax expense - - - (180) (180)
------------------------------ ------- ----- -------------- -------------- --------
Profit/(Loss) after tax (114) (95) (56) (56) (321)
*Calculated as profit before tax, interest, amortization, depreciation,
share compensation expense and impairment of assets.
The segmental results for the year ended 30 June 2016 were as follows:
North Latin
GBP000's Europe Asia Pacific America America Group
Mobile Operator Services 31 6 58 80 175
Mobile Internet Services - 21 11 12,552 12,584
Other Service fees 23 - - 5 28
---------------------------- ------- ------------- --------- --------- --------
Total Revenue 54 27 69 12,637 12,786
Cost of sales (33) (29) (30) (9,165) (9,257)
---------------------------- ------- ------------- --------- --------- --------
Gross profit/(loss) 21 (2) 39 3,472 3,530
Operating expenses (557) (317) (113) (3,189) (4,176)
---------------------------- ------- ------------- --------- --------- --------
EBITDA* (536) (319) (74) 283 (646)
---------------------------- ------- ------------- --------- --------- --------
Depreciation, amortisation
and impairment - (1) - (57) (58)
Share based compensation (146) - - - (146)
Finance income/expense - - - 113 113
---------------------------- ------- ------------- --------- --------- --------
Profit/(Loss) before tax (682) (320) (74) 339 (737)
Taxation - - - (569) (569)
---------------------------- ------- ------------- --------- --------- --------
Loss after tax (682) (320) (74) (230) (1,306)
*Calculated as profit before tax, interest, amortization, depreciation,
share compensation expense and impairment of assets.
The segmental assets at 31 December 2016 were as
follows:
North Latin
GBP000's Europe Asia America America Group
Non current fixed assets
Property, plant & equipment - - - 8 8
----------------------------- ------- ----- --------- --------- --------
Intangible assets - - - - -
----------------------------- ------- ----- --------- --------- --------
Deferred tax - - - 189 189
----------------------------- ------- ----- --------- --------- --------
Current assets 1,887 201 151 2,411 4,650
----------------------------- ------- ----- --------- --------- --------
Cash and cash equivalents 1,853 44 59 824 2,780
Accounts receivable 4 89 4 349 446
Accrued receivables 11 3 40 182 236
Prepayments 13 3 12 678 706
Minimum guarantees
and advances - - - 4 4
Other assets 6 62 36 374 478
TOTAL ASSETS 1,887 201 151 2,608 4,847
============================= ======= ===== ========= ========= ========
Current liabilities (156) (56) (313) (1,475) (2,000)
----------------------------- ------- ----- --------- --------- --------
Trade Payables (72) (29) (35) (157) (293)
Accrued content costs (33) (30) (261) (322) (646)
Other accrued liabilities (52) 22 (17) (376) (423)
Other payables 1 (19) - (83) (101)
Corporate income tax
payable - - - (537) (537)
TOTAL LIABILITIES (156) (56) (313) (1,475) (2,000)
============================= ======= ===== ========= ========= ========
The segmental assets at 31 December 2015
were as follows:
North Latin
GBP000's Europe Asia America America Group
Non current fixed
assets
Property, plant &
equipment - - - 52 52
--------------------------- ------- ----- --------- --------- --------
Intangible assets - - 1 - 1
--------------------------- ------- ----- --------- --------- --------
Current assets 183 218 347 4,071 4,819
--------------------------- ------- ----- --------- --------- --------
Cash and cash equivalents 108 35 254 1,115 1,512
Accounts receivable 14 54 13 590 671
Accrued receivables 8 104 40 471 623
Prepayments 25 10 10 1,678 1,723
Minimum guarantees
and advances - - - 13 13
Other assets 28 15 30 204 277
TOTAL ASSETS 183 218 348 4,123 4,872
=========================== ======= ===== ========= ========= ========
Current liabilities (167) (68) (275) (1,723) (2,233)
--------------------------- ------- ----- --------- --------- --------
Trade Payables (72) (37) (30) (168) (307)
Accrued content costs (30) (17) (230) (447) (724)
Other accrued liabilities (43) (1) (15) (302) (361)
Other payables (22) (13) - (180) (215)
Corporate income tax
payable - - - (626) (626)
TOTAL LIABILITIES (167) (68) (275) (1,723) (2,233)
=========================== ======= ===== ========= ========= ========
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
The segmental assets at 30 June 2016 were
as follows:
North Latin
GBP000's Europe Asia America America Total
Non current fixed assets
Property, plant & equipment - - 1 19 20
----------------------------- ------- ----- --------- --------- --------
Intangible assets - - - - -
----------------------------- ------- ----- --------- --------- --------
Current assets 84 116 176 3,756 4,132
----------------------------- ------- ----- --------- --------- --------
Cash and cash equivalents 29 35 60 1,243 1,367
Accounts receivable - 56 7 490 553
Accrued receivables 12 8 39 374 433
Prepayments 15 5 11 1,223 1,254
Minimum guarantees
and advances - - - 13 13
Other assets 28 12 59 224 323
Deferred tax asset - - - 189 189
TOTAL ASSETS 84 116 177 3,775 4,152
============================= ======= ===== ========= ========= ========
Current liabilities (162) 35 (297) (2,168) (2,592)
----------------------------- ------- ----- --------- --------- --------
Trade Payables (70) (47) (37) (195) (349)
Accrued content costs (35) (16) (243) (383) (677)
Other accrued liabilities (57) 108 (17) (443) (409)
Other payables - (10) - (150) (160)
Corporate income tax
payable - - - (997) (997)
TOTAL LIABILITIES (162) 35 (297) (2,168) (2,592)
============================= ======= ===== ========= ========= ========
3. EARNINGS PER SHARE
Earnings per share
Earnings per share is calculated by dividing the(loss)/profit
attributable to equity holders of the Company by the weighted
average number of ordinary shares in issue during the period.
Unaudited Unaudited Audited
6 months 6 months 12 months
ended 31 ended 31 ended 30
December December June 2016
2016 2015
Loss for the period (GBP000's) (879) (321) -1,306
----------- ----------- ------------
Loss earnings per share (pence):
Basic (2,167) (0,865) (3,519)
Diluted (2,167) (0,865) (3,519)
Adjusted earnings per share
Adjusted earnings per share is calculated to reflect the underlying
profitability of the business by excluding non-cash charges
for depreciation, amortisation, impairments and share compensation
charges.
6 months 6 months 12 months
ended 31 ended 31 ended 30
December December June 2016
2016 2015
GBP000's GBP000's GBP000's
Loss for the period (879) (321) -1,306
Add back: share compensation
expense 97 44 146
Add back: depreciation and amortisation 14 27 59
Adjusted Loss for the period (768) (250) -1,101
Pence per Pence per Pence per
share share share
Adjusted loss per share (1.894) (0.674) (2.967)
Adjusted diluted loss per share (1.894) (0.674) (2.967)
Weighted average number of shares
6 months 6 months 12 months
ended 31 ended 31 ended 30
December December June 2016
2016 2015
Basic 40,507,910 37,100,536 37,114,283
Exercisable share options - 2,330,960 -
----------- ----------- ------------
Diluted 40,507,910 39,431,496 37,114,283
----------- ----------- ------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Diluted (loss)/earnings per share is calculated adjusting the
weighted average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares. The Company
has only one category of ordinary shares.
The adjusted EPS has been calculated to reflect the underlying
profitability of the business by excluding non-cash charges for
depreciation, amortisation, impairments and share compensation
charges.
4. GOING CONCERN
The Group had cash balances of GBP2.8m at 31 December 2016 (30
June 2016: GBP1.4m) and no borrowings. Having reviewed cash flow
forecasts and budgets for a year ahead the Directors have a
reasonable expectation that the Group has sufficient resources to
continue in operational existence for the foreseeable future.
As at 31 December 2016, GBP0.7m (including short-term
investments of GBP0.6m) of the Group's cash balance was held in
Argentina. The Argentine Government has released the currency
restrictions in December 2015. Since then, the Peso has remained
relatively stable, although we cannot predict future movements in
the currency and the impact on our financial performance.
5. FOREIGN CURRENCY TRANSLATION
(a) Presentational currency
The consolidated financial statements are presented in British
pounds: the functional currency of the parent entity is also
British pounds.
(b) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the date the
transaction occurs. Any exchange gains or losses resulting from
these transactions and from the translation of monetary assets and
liabilities at the balance sheet date are reported in the income
statement except when these represent a net investment in a
subsidiary when they are charged or credited to equity
.
Foreign currency balances are translated at the balance sheet
date using exchange rates prevailing at the period end.
(c) Group companies
The financial results and position of all group entities that
have a functional currency different from the presentational
currency of the Group are translated into the presentational
currency as follows:
i- assets and liabilities for each balance sheet are translated
at the closing exchange rate at the date of the balance sheet
ii - income and expenses for each income statement are
translated at average exchange rates (unless it is not a reasonable
approximation to the exchange rate at the date of transaction)
iii- all resulting exchange differences are recognised as a
separate component of equity (translation reserve)
The exchange rates used in respect of Argentinean pesos are the
official published exchange rates.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BUGDXIDXBGRG
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