MONITISE PLC
RNS Number : 3698I Monitise PLC
25 March 2015
MONITISE plc
Monitise announces conclusion of its Strategic Review, end of Offer Period and Board changes
Independent strategy to be pursued
FY 2016 EBITDA profitability target reiterated
25 March 2015, London, UK - Monitise plc (LSE: MONI) ("Monitise", the "Company" or "Group") announces that, further to the initiation on 22 January 2015 of a Strategic Review for the business, the Board has concluded that the best way of maximising long- term value for all stakeholders is to continue transforming and streamlining the business as an independent company. In addition, Monitise reiterates its FY 2016 EBITDA profitability target. Accordingly, the Formal Sale Process previously announced on 22 January
2015 has now ceased, and the Company is no longer in an "Offer Period" (as defined in the UK Takeover Code).
Strategic Review
As part of the Strategic Review initiated on 22 January 2015, the Board, supported by Moelis & Company as independent financial adviser, thoroughly explored all options open to the Company. In considering options for the business under the Strategic Review, the Board was cognisant of the value on a standalone basis of Monitise's partnerships with strategic investors, channel partners and clients such as Santander, MasterCard, IBM, Visa Europe, and RBS among others. The Board received a number of expressions of interest from various parties. However, the Board concluded that none of these indicative and non-binding proposals fully recognised the longer- term value of Monitise. The expressions of interest were also structured in such a way that there was considerable uncertainty over
their ultimate deliverability. The Board was also mindful that the Strategic Review should conclude within an acceptable timeframe;
such that it did not interfere unduly with ongoing business opportunities, client services and discussions with partners and clients.
Board changes
· Co-CEO Elizabeth Buse becomes sole CEO of Monitise.
· Founder and co-CEO Alastair Lukies steps down from the Board with immediate effect and
remains available to the business and key partners as Founder and Strategic Adviser to Elizabeth Buse.
· Stephen Shurrock, CEO of Consumer at Telefónica within the Commercial & Digital Unit, is appointed Non-Executive Director representing strategic shareholders Telefónica and Santander. An announcement regarding Stephen's appointment, including details required under the AIM Rules, is being released separately this morning.
Standalone strategy and on-going business transformation
· Monitise's focus will be on sales in Europe, the Middle East and North America. Additional market opportunities will be pursued where they directly support partner needs.
· Cost optimisation projects already announced, including the transition of UK professional services employees to IBM, and streamlining benefits from the shift to being a product-led business such as
a narrowing of development focus to core products, to be supplemented by new initiatives, including centralising its R&D from a hub in Istanbul.
· Action underway to improve profitability of under-performing businesses and exit non-core business areas.
· Initial Monitise Central Platform Bank and Pay capabilities launching in April with additional functionality to follow driven by customer demand.
· Transition to recurring-revenue driven business underway, building on strong client and partner relationships, internal expertise, and solid balance sheet, as outlined most recently at the 17
February 2015 Capital Markets Day.
"Santander believes that Monitise is uniquely well positioned as an independent player in the fast-growing digital money space. We have already through our partnership with Monitise developed some market-leading propositions for our customers and intend to continue doing so through what we expect to be a long and mutually beneficial collaboration." - Senior Executive Vice-President and Corporate Director of Innovation at Banco Santander José María Fuster
Current trading and guidance
· Reiterate guidance for FY 2015 (revenue £90-100m and EBITDA loss £40-50m) and for EBITDA
profitability in FY 2016.
· In addition to revenue growth, we continue to expect H2 2015 operating and capital expenses to be materially lower than H1 with a further improvement in FY 2016.
· Company's cash position provides balance sheet strength to see Monitise through to break-even and beyond.
· Monitise continues to see 200m users / £2.50 ARPU as commensurate with the scale of its opportunity. Given the achievement of those targets will be driven by partner-led product and service roll outs we no longer think it appropriate to give guidance as to the timing of those targets.
· More than 30% EBITDA margins by end FY 2018, underpinned by high operational leverage in the business.
best prospects for the business and shareholders are through remaining as an independent company. I am extremely confident that the business is at a point in its development where the prospects for delivering long-term value are excellent. The feedback from third parties re-affirms that we have a uniquely strong technology platform, a talented and highly respected management team, and a deep well of support among staff, partners and clients for what we are seeking to achieve.
Since joining Monitise, Elizabeth Buse has made a significant impact across the business and the Board is delighted that she will be leading the Company during the next phase of its development. We are delighted that Stephen Shurrock is joining us as Non-Executive Director. He brings invaluable experience from his time spearheading leading businesses in the telecoms and digital industries, and joins us at an important time for Monitise.
On behalf of the Board, I would like to thank Alastair Lukies as the founder of, and inspiration behind, Monitise. His vision, tireless hard work and energy have created a business that has delivered leadership in its space and given us the base from which we can build a long-term successful business. The Board is very pleased that Alastair will continue to work with us in his new role as Founder and Strategic Adviser."
Chairman Peter Ayliffe, CEO Elizabeth Buse, and CFO Brad Petzer will host a conference call for investors and analysts today, Wednesday March 25 2015 at 9am GMT.
Dial-in details are as follows:
Conference ID and name: 14748787 & 'Monitise call' UK Free Dial-In: 08000738965
Standard International Dial-In: +44 (0) 1452 560304
US Dial-In: 16316215256/ 18669265708
A replay facility will also be available within 24 hours on the following numbers:
UK Free Dial-In Call: 08009531533
Standard International: +44 (0)1452550000
US Dial-In: 1 (866) 247-4222
The replay facility will be available for seven days.
About Monitise
Monitise (LSE: MONI) is a world leader in Mobile Money - banking, paying and buying with a mobile device. Leading banks, payments companies, retailers and mobile networks use Monitise's technology platforms and services to securely connect people with their money.
33 million consumers have registered for Monitise's patented technology to 'bank anywhere', 'pay anyone' and 'buy anything', accounting for $101bn of payments, purchases and transfers annually. Additionally, Monitise-designed high-engagement apps across multiple industry verticals and email subscribers to the Monitise Content consumer business total more than 49 million. More information is available at www.monitise.com. For views and insights from the Monitise team about the world of Mobile Money, visit www.monitise.com/insightsand to find out more about Monitise's mobile innovation and design studio, visit www.monitisecreate.com.
Enquiries:
Investor Relations
Richard Johnson, Michelle Singleton investorrelations@monitise.com
Media Relations
Gavin Haycock, Anna Howard press@monitise.com
Moelis & Company
(Financial Adviser)
Mark Aedy, Elliot Richmond
Canaccord Genuity
(NOMAD)
Simon Bridges, Cameron Duncan
Jonathan Glass, Andrew Garfield
Tel: +44(0)20 3657 0331
Tel: +44(0)20 3657 0362
Tel: +44(0)20 7634 3500
Tel: +44(0)20 7523 8000
Tel: +44(0)207 404 5959
Forward Looking Statements
This announcement includes statements relating to the business, financial performance and results of the Company and/or the
industry that the Company operates in which are forward-looking in nature (all statements other than statements of historical facts could be deemed to be forward-looking statements). These forward looking statements are based on the Company's or, as appropriate, the Company's directors', current expectations and projections about future events. These forward-looking statements speak only as of the date of this announcement and are subject to risks, uncertainties and assumptions about the Company and its subsidiaries and investments, including, among other things, the development of its business, trends in its operating industry and future developments in the m-commerce market. In light of these risks, uncertainties and assumptions, the events or circumstances referred to in the forward- looking statements may differ materially from those indicated in these statements, and you should not place undue reliance on these forward-looking statements as a prediction of actual results or otherwise. Save to the extent expressly stated herein in respect of the Profit Forecasts, none of the future projections, expectations, estimates or prospects in this announcement should be taken as
forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in this announcement.
None of the Company nor any other person guarantees that the assumptions that underpin any such forward-looking statements are free from errors, nor do they accept responsibility for the future accuracy of any of the opinions expressed in this announcement. These forward-looking statements speak only as at the date of this announcement and, except as required by the AIM Rules and applicable law, the Company undertakes no obligation to update or change any forward-looking statements to reflect events occurring after the date of this announcement.
Moelis & Company is acting exclusively as financial adviser to Monitise and no one else in connection with the Strategic Review described in this announcement. In connection with such matters, Moelis & Company will not regard any other person as their client, nor will they be responsible to any person other than Monitise for providing the protections afforded to clients of Moelis & Company or
for providing advice in connection with the Strategic Review described in this announcement or any matter referred to herein.
This information is provided by RNS
The company news service from the London Stock Exchange
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