- Briefing Room
- Consumer Engagement
- Commerce 3.0
Monitise plc (LSE: MONI.L), the technology and services company delivering mobile banking, payments and commerce networks worldwide, announces an unaudited trading update following its 30 June 2012 financial year-end. Monitise's 2012 full-year results are scheduled to be published on 4 September 2012.
(1) Foreign exchange rate for Sterling/US Dollar used in the trading update is $1.56
(2) See separate section on Accounting for Joint Ventures
Monitise’s worldwide trading momentum, new business wins and launches continue to expand around the globe:
-- New multi-year bank contracts have been entered with HSBC, RBS and The Co-operative Bank. Monitise entered a strategic five-year agreement with FIS, the world’s largest global provider dedicated to banking and payments technologies, following Monitise Group’s buyout of its US Joint Venture. In India, Movida, a Monitise joint venture with Visa Inc., entered an agreement with HDFC Bank, India’s second-largest private bank, to launch new mobile payments services.
Monitise Group CEO Alastair Lukies said:
“The Mobile Money landscape continues to grow at an astonishing rate. As a major global force in Mobile Money, Monitise remains positioned at the centre of this huge ecosystem with its platform, skills and partnerships driving another year of phenomenal growth. Our clear and unwavering strategy is to provide our white-labeled, cloud-based Monitise Enterprise Platform to the world’s leading financial institutions and payments companies, helping them retain their rightful role as the consumer custodian in mobile financial services.”
Monitise Group Chairman Duncan McIntyre added:
“Once again the Monitise team has achieved substantial growth in the financial year 2012 and proven the global demand for a truly bank-grade Mobile Money platform. We believe we have both the leading platform and market position so as the landscape continues to evolve and accelerate we must continue to invest to optimise shareholder value.”
Accounting for Joint Ventures
To date the Group’s interests in Joint Ventures have been accounted for by proportionate consolidation, primarily as the initial revenues were generated through the UK JV with Monilink. As a result, the Group’s share of each JV’s revenue, costs, assets and liabilities have been included line by line in the Group’s financial statements.
As the Group has evolved, the JVs have matured as entities, and the Directors believe that it is now more appropriate to account for the joint ventures under equity accounting. This has the effect of combining all the Group’s shares in JVs financials in one line in the income statement (Share of Associates and JVs), which is reported below EBITDA and Operating Profit, and one line in the Balance Sheet. At the same time, a new accounting standard, IFRS 11, has been released which disallows proportionate accounting and is anticipated to become effective for Monitise from 2014/15.
Therefore the Group accounts will be prepared on the equity accounting basis for 2011/12. The key financials on a proportionate accounting basis will also be shown as a memorandum.
For 2011/12 it is expected that the move to equity accounting will result in a $3m (£2m) increase in reported revenues to approximately $56m (£36m). This is due to the JVs’ current stage of evolution, as development revenues earned by Monitise from the JVs exceed revenues generated by the JVs themselves. The impact on EBITDA and Operating Profit in 2011/12 is expected to be an improvement in the region of $5m (£3m), with no significant change to reported profit. The impact on the financials for 2012/13 is expected to be marginal for revenue, EBITDA and operating profit.
Monitise plc (LSE: MONI.L) is a technology and services company delivering mobile banking, payments and commerce solutions worldwide, with the proven expertise to enable financial institutions, network operators and merchants to make money more mobile globally. With live services in the UK, US, India and Africa, Monitise securely processes hundreds of millions of transactions worth billions of dollars each year via its Enterprise technology platform.
Following the acquisition of Clairmail, a California-based mobile banking and payments specialist, Monitise’s strategic partner and client base includes financial institutions and payments companies such as Visa Inc. and Visa Europe, FIS, Royal Bank of Scotland, Fifth Third Bank, HSBC, Lloyds Banking Group, Co-operative Banking Group, Sallie Mae, PNC Bank, Frost National Bank, Standard Chartered, Travelex, Permata Bank and HDFC Bank among others. Other leading partners include Vocalink, Vodafone, Orange, O2, T-Mobile, 3 UK, Research In Motion, The Carphone Warehouse, First Eastern, Astra International, JETCO and PCCW mobile.
More information is available at www.monitise.com