Zamano PLC Trading Update (9347V)
03 February 2017 - 6:00PM
UK Regulatory
TIDMZMNO
RNS Number : 9347V
Zamano PLC
03 February 2017
This announcement contains inside information
zamano plc
("zamano" of the "Company")
Trading Update
zamano plc, a leading European provider of interactive
applications and services to mobile devices, provides a trading
update following the introduction of Payforit in the UK and the
possible implementation of regulatory change in Ireland.
UK business
As previously notified, Payforit is a joint initiative of mobile
network operators ("MNOs") in the UK to regulate mobile payments
and its implementation represented a significant regulatory change
in the operating environment in the UK. Since it became effective
for the company during November 2016, Payforit, as expected and
communicated previously, is having an on-going and significant
impact on the Company's business performance.
In this regard, zamano has seen a reduction in performance
across all its business lines and, to date, the Company has not
been able to secure any replacement revenue through new subscribers
since this time.
Ireland business
In Ireland, certain MNOs are also now requiring all service and
payment flows to use similar rules to Payforit in the UK. The
Company anticipates that these changes, when implemented over the
next month, will also significantly impact the Company's ability to
acquire new customers in Ireland.
Financial update
On 25 November 2016 the Company announced that, as a result of
the Payforit implementation in the UK, the Board had taken steps to
reduce the cost base of the business, cease all ongoing M&A
discussions and focus on maximising cashflow from the Company's
existing business in the UK, Irish and International markets.
The above actions were taken to maintain a cash generative and
profitable business whilst also protecting the Company's existing
cash position and shareholder value. Despite taking these actions,
which have achieved material cost reductions, it is now
increasingly likely that the impact of regulatory changes across
zamano's business lines will prevent the Company from maintaining a
cashflow positive trading position going forward.
In light of this the Board believes that it is necessary for the
Company to take the decision to formally wind down the existing
business lines in order to protect the cash position on the balance
sheet. The Board is also currently considering alternative
strategic options that are being assessed. It is anticipated that
such options would require shareholder approval and, accordingly,
the Company will update the market in due course on the alternative
options. In the absence of a timely strategic alternative, the
Company will look to monetise its UK/Irish listing and make a
distribution back to shareholders.
Colin Tucker, Acting Chairman of zamano commented:
"The Zamano Board is focused on conserving the company's strong
cash position by optimising our withdrawal from our existing
business lines. The on-going regulatory changes in our industry
have forced our hand earlier than anticipated. We are hopeful in
relation to our strategic discussions, however in the absence of
concluding a transaction which shareholders approve, we will focus
on how best to return the maximum amount of cash possible to
shareholders."
For further information, please contact:
zamano plc
Michael Connolly, Chief Tel: +353 1 554 7261
Financial Officer
Investec Corporate Finance
Shane Lawlor/Ian McGreal Tel: + 353 1 4210000
Cenkos Securities
Derrick Lee/Neil McDonald Tel: + 44 (0) 131 220
6939
MCOMM Communications Consultants
Richard Moore Tel: +353 1 661 9428
Mob: +353 87 241 4751
Email: ir@zamano.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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