Sydney, Feb 24, 2009 AEST (ABN Newswire) - eServGlobal Limited (LSE:ESG)(ASX:ESV), a provider of end-to-end solutions, enabling smart communication and payment services for service providers on any generation network, today announces its results for the six months ended 31 December 2008.
Sales revenue for the first half was AUD83.1 million, compared with AUD91.1 million for the previous corresponding period. EBITDA for the first half was AUD7.1 million, compared with AUD13.2m in the previous corresponding period, partly due to costs associated with our restructuring programme.
The EBITDA figure for the first half of AUD7.1 million was recorded after the capitalisation of development expenditure, incurred during the period, of AUD2.5 million, relating to the development of eServGlobal's HomeSend platform, announced on 16 February 2009. The capitalisation of the development expenditure is in accordance with the Company's accounting policies because no revenue for the HomeSend platform is expected to be generated in the FY09 year.
-------------------------------------------------------------- Six months to Six months to 31 Dec 2008 31 Dec 2007-------------------------------------------------------------- AUD '000 AUD '000--------------------------------------------------------------Sales Revenue 83,093 91,194--------------------------------------------------------------Cost of Sales 41,560 43,572Gross Profit 41,533 47,622Other Revenue 214 121Research & Development Costs 11,060 14,622Sales & Marketing Costs 11,849 8,176Administration Costs 11,773 11,753Total Opex 34,682 34,551--------------------------------------------------------------EBITDA 7,065 13,192--------------------------------------------------------------Depreciation 1,708 1,492Amortisation 3,847 3,411--------------------------------------------------------------EBIT 1,520 8,289--------------------------------------------------------------Interest Expense 105 169Profit before Tax 1,415 8,120Tax Expense / (Benefit) 689 2,875--------------------------------------------------------------Profit after Tax 726 5,245--------------------------------------------------------------Minority Interest 124 51--------------------------------------------------------------Profit attributable to members 602 5,194--------------------------------------------------------------
Net cash reserves at 31 December 2008 were AUD10.2 million (AUD2.6 million at 31
December 2007).
Operational Review
Mr. Ian Buddery, Executive Chairman of eServGlobal, said, "The first half EBITDA was impacted by our restructuring programme, which will transfer headcount and infrastructure to our low cost locations in Romania and India and which will begin to bring cost savings in the second half of this fiscal year, taking full effect in the 2010 fiscal year.
"The Company is rapidly innovating and creating new opportunities. Our SRM (Social Relationship Manager) announced on 9 February 2009, enables telecoms operators to engage with a potential market of over 650 million social network website users and features an innovative deployment model, which allows us to penetrate new accounts with a compelling business benefit.
"GSMA, the global mobile operators' association, recently selected eServGlobal's HomeSend service as one of three remittance platforms endorsed for their 750 GSM mobile phone operators and 3 billion subscribers worldwide. HomeSend is the only mobile-centric platform and represents both a new revenue channel for operators and a cost saving for subscribers.
The Juniper Research study of 4 February 2009 indicated that the mobile money transfer market will reach at least US$73bn by 2011.
"The global telecommunications market is being affected by the global economic downturn, however eServGlobal is able to deliver solutions now that maximise operator revenues in the short term, while we continue to develop new products that will position us as a leader in the next wave of telecommunications growth."
Outlook
We believe that the second half will demonstrate improved revenue and profit performance and a momentum for continuing growth in FY10, driven by demand for our new products and recovering subscriber growth in emerging countries.
The formal process involving a shortlist of potential acquirers of the Company, referred to in the Shareholder Update of 30 January 2009, is continuing and further announcements will be made in due course.
Contact
Ian Buddery
Executive Chairman
eServGlobal Limited
Numis Securities Limited
Brent Nabbs (NOMAD) / David Poutney (Broking)
Tel: +44-0-20-7260-1000
ICIS (financial PR)
Christian Taylor-Wilkinson / Bob Huxford
Tel: +44-0-20-7651-8688
eServGlobal Limited
Sally Bennett, Communications Manager
sally.bennett@eservglobal.com
T: +33-1-46-12-77-46
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