Latest Results

Unaudited Interim Results for the period ended 31 March 2018


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Introduction and Key highlights

The Board is pleased to announce the Company's unaudited results for the six month period ending 31 March 2018. The key highlights during the period were:

  • As at 31 March 2018 YOLO's Net Asset Value equates to 9.9p per ordinary share versus a share price of 4.75p as at 4 May 2018.
  • On 2 January 2018 the Company invested an additional £50,000 into TVPlayer via a convertible loan note as part of a £2m fundraise from existing investors for further growth and progress.
  • Investee company Magic Media Works has secured funding of £2m from existing shareholders and due to significant interest from external parties in its new ROXI product, has extended the current round to £2.5m.
  • On 28 March 2018 the Company restructured its share capital by consolidating its existing ordinary shares into 1 new share for 10 old shares and then splitting the new shares into new 0.01p ordinary shares and new 9.99p deferred shares.

 

CHAIRMAN'S STATEMENT
for the six months ended 31 March 2018

Introduction

I am pleased to report that the Company has had an active six month period ending 31 March 2018.

YOLO, as an AIM Rule 15 investment company, has invested into businesses at the forefront of innovation and breakthrough technologies that are reshaping how consumers engage with media content through technology. The exciting sectors and companies we have invested into are; e-sports, OTT broadcast tv streaming, music streaming and podcasting, all of which are enjoying significant growth as they disrupt and transform their respective industries and all of which have enormous international potential.

As an investment company YOLO continues to support and actively work with each of our investee companies to maximise shareholder value and build quality businesses. Our portfolio consists of two listed and three private companies all of which operate in the media technology sectors. Based on fair values at 31 March 2018, our investments are showing a potential gross return on investment of over 20%. We believe that there is still significant upside to be delivered and we are working with each of the boards of our investee companies to realise this potential.

Following the share capital restructuring, the Company's Net Asset Value at 31 March 2018 equates to 9.9p per ordinary share.

Market context and background to investment strategy

Each of the companies we have invested in are innovators that are creating and capitalising on new user experiences which engage and enable consumers to enjoy media content at their convenience via a variety of platforms. Each of the businesses have slightly different business models but all have a common goal to monetise the media consumption and innovative technology.

Our investee companies have made significant investments in their proprietary technology through in-house R&D and they continue to grow as valuable standalone businesses. Their proven disruptive technology and engaging entertainment platforms are now being seen as potential acquisition targets.

As an investment business we are constantly striving to improve and evaluate the best ways to generate returns for our shareholders. Our focus is on building strong sustainable companies from early stage entrepreneurial businesses. Our primary objectives are to maximise value of our existing investments and capital deployed, whilst in parallel identifying incremental growth opportunities and prospects. We are actively working with the boards of our investee companies to evaluate exit opportunities and optimal ways to accelerate growth. We recognise our role is to assist and advise them through these phases to maximise shareholder return.

As early movers and innovators in their sectors, our investee companies are continually seeking ways to maximise the monetary value of their business models. The company valuations are based around the valuation of the proprietary technology developed, the number of active users of the product current and future potential and the amount of revenue generated per engaged user.

How consumers spend their leisure time and disposable income is a key theme for each of Yolo's investee companies and of equal importance is how they monetise this engagement time. Each of them has worked to capitalise on the shift to digital by developing technology platforms and capability that engage consumers with media content to create innovative and entertaining experiences that consumers value.

Consumers are increasingly looking to enrich their lives through entertainment experiences, aiming to make their everyday life more enjoyable and memorable. Improved technology in the form of smart TVs and the emergence of streaming services have encouraged consumers to enjoy leisure in the comfort of their own home.

We believe that each of our investee companies are in a "hot" space, with the ability and intent to scale internationally. Indicative valuations reflect the number of current and potential users multiplied by the likely lifetime value of the user or multiples of revenue as appropriate.

Summary of investment portfolio

The Board has been selective in the transactions made and our investment portfolio now consists of businesses with strong technology and content themes. Each of the businesses are pioneers and innovators in their sectors and are disrupting the space that they are in, which is consistent with YOLO's investment criteria.

TVPlayer:

Since being founded in 2014, TVPlayer has become one of the UK's fastest growing complete pay-TV platforms. As an aggregator of major free to air and pay TV channels in an over the top (OTT) service, the company has established its presence across all of the main consumer device technologies, including online, mobile, connected TV, games consoles and other connected devices which enable TV apps. The company, which operates a freemium TV model, has surpassed 1.5 million monthly active users and has reached over 60,000 subscribers on its premium pay-TV service. This represents a year-on-year growth rate of over 125%.

TV consumption and behaviour is rapidly changing. Connected device adoption and increases in internet speeds are enabling new ways to consume television as consumers no longer need to rely on set top box technologies. The emergence of OTT content aggregators provides consumers with more choice and flexibility than ever before and traditional TV platforms are having to work hard to retain subscribers as they adopt OTT services (cord cutting). Subscription Video on demand (SVOD) and Advertising Video on Demand (AVOD) are continuing to change the way viewers consume content and broadcasters/ content providers monetise their offerings. TVPlayer is well positioned to meet these changes in consumer trends.

TVPlayer's proprietary technology platform allows the company to service millions of users at a significantly reduced cost to that faced by new OTT entrants and traditional pay TV companies. TVPlayer's technology and metadata enables it to get closer to the consumer, providing a more targeted, immersive, cost efficient and personalised offering. 

TVPlayer, with its impressive credentials and momentum, is attracting interest from a number of strategic media investors and acquirers. TVPlayer delivered quarterly revenues of over £1.5m in Q3 to February 2018. We believe that valuations in this space vary between 6 and 10 times annual revenues for OTT platforms implying a valuation of between £36m and £60m.

To further accelerate growth and strengthen its management team, TVPlayer has appointed Scott Kewley (previously at Virgin Media) and Nick James (previously at Talk Talk & Lovefilm) as Chief Operating Officer and Chief Technology Officer respectively. Rob Hodgkinson has moved into the Chief Financial Officer role and Adam Smith, the company Founder, continues as Chief Executive Officer.

Scott was formerly Director of Digital Entertainment at Virgin Media and has latterly been leading a consumer-facing OTT platform in the UK. James was previously Head of TV Architecture & Innovation at TalkTalk, with prior experience at Lovefilm and Sky. In their new remits, Scott and James will be tasked with multiplying the TVPlayer premium subscriber base.

Yolo has a holding of 11,067 shares equating to 4.2% on a fully diluted basis, A&E Networks is a major strategic investor with a 24.9% holding, and Beringea LLP holds 10.9%.

Simplestream:

Simplestream is a leading provider of Software as a Service (SaaS) based live linear and video on demand (Vod) broadcasting and streaming solutions. Clients include; News Corporation (Ball Ball), A&E Networks (Blaze), Sony Traceplay, QVC TV shopping, Box Nation, Little Dot Studios and At The Races amongst others.

Simplestream's proprietary Media Manager cloud technology platform provides live and on demand streaming solutions including; Hybrid TV, VoD in a box incorporating functionality such as personal video recording, TV Apps for mobile devices and desktop and Internet Protocol Television (IPTV) for broadcasters, publishers, telco, cable and SVoD platforms.

Simplestream has seen over 40% revenue growth year on year. Simplestream now delivers services across Europe, the US, Africa and the Far East with further international expansion planned for 2018. Simplestream is opening a new office in North America to service its expanding international client base and has signed up new partners in the last quarter including: British Forces TV and radio services, History Hit TV and Little Dot Studios, a BAFTA and Emmy award winning content producer and broadcaster.

YOLO holds 9,943 shares in Simplestream, which represents a 6.34% holding on a fully diluted basis.

Magic Media Works Ltd ("MMW"):

MMW is a music entertainment technology business. MMW's's mission is to bring families together through shared music entertainment experiences.

ROXI, which launched in the UK and US markets in late 2017, is an easy way for friends and families to enjoy music together, with a two minute set-up, tens of millions of songs pre-loaded, Voice Search and many unique bonus entertainment features, all in one competitively-priced music entertainment hub.

Offering Unlimited Music, Karaoke-style singing, global radio access, an ambient Sound Machine and ROXI's unique music trivia game, Name That Tune, ROXI is highly differentiated and popular with its target market of older, family consumers. 93% of purchasers say they would recommend it to friends and family and 68% of purchasers say they use it every day or several times a week.

The Streaming Market is Still in its Infancy. Streaming has changed the way many people access music, we recognise that there is an untapped global audience with significant growth potential. The majority of Spotify users are aged 34 or below. ROXI is therefore targeting a different and complimentary audience and so we believe has great potential of success.

MMW has global rights agreements with all the major labels; Universal Music Group, Sony Music Group, Warner Music Group and major independents including Merlin Music, providing customers with one year's access to a premium music catalogue of over 29 million music tracks ad-free.

MMW is focused on continually improving engagement with its consumers through further enhancement and refinement of user experience and facilitating integration in third party home ecosystems to ensure that ever more people can access and enjoy the product. 

Following initial success with TV shopping channels and live retail, the company is now focusing on broadening its consumer marketing campaign with TV infomercial shows across mainstream TV in the UK and the USA, in partnership with specialist infomercial content providers, to enable a scaling of the business in these markets, and elsewhere.

Henrik Holmark, previously the CFO of Pandora Jewellery, has joined the MMW board as a non-executive Investor Director.

On completion of the recently announced £2.0 million investment round, Yolo's holding in MMW will represent 1,646,682 Ordinary Shares, representing 18.6 percent of the issued share capital of Magic. The Company has options over a further 95,000 ordinary shares in MMW.

GFinity Plc:

GFinity is an end-to-end eSports (also known as competitive gaming) solution, founded in 2012. GFinity has quickly established itself as one of the world's leading eSports companies, capable of providing an end-to-end solution and with a strong reputation for quality across publishers, players and eSports fans. It stages elite tournaments for the top players in the world, producing industry leading broadcasts and providing on-line competitions and content to engage the eSports community. 

GFinity has made significant progress this year, with the launch of the Elite Series season two, a renewed partnership with Formula One, the launch of the Elite Series in Australia, new broadcasting partnerships with BT Sport, BBC 3 and Eleven Sports and the acquisition of CEVO, an American based provider of technology and services to the eSports market.

YOLO holds 400,000 shares in GFinity.

AudioBoom Plc:

AudioBoom is one of the world's leading spoken-word audio or podcasting platforms for hosting, distributing and monetising content that enables the creation, broadcast and syndication of audio content across multiple networks and geographies. AudioBoom works with its partners to monetise their audio via live in-reads, the dynamic insertion of pre and post roll audio adverts and video ads. The platform enables partners to deliver their content to millions of listeners worldwide via embedded (in websites) players, mobile applications, Facebook and Twitter integrations.

In February 2018 AudioBoom had 82.3m users, up by 40% on February 2017 users.

On 13 February 2018 AudioBoom announced the proposed acquisition of Triton Digital, and on 27 April 2018 announced it was still in the process of trying to complete this acquisition.

Yolo holds 5,340,000 shares in AudioBoom.

Restructure of Share Capital

At the AGM held on 28 March 2018, shareholders approved the resolution for a share consolidation and subdivision which resulted in YOLO shareholders receiving one new ordinary share of 0.01p each ("New 0.01p Ordinary Share") and one new deferred share of 9.99p each ("New Deferred Share") in YOLO in exchange for every ten existing ordinary shares of 1p each ("Existing Ordinary Shares"). Following completion of the share capital reorganisation, the total issued ordinary share capital of the Company is now 44,132,276 New 0.01p Ordinary Shares, each with voting rights.

The Board as well as continuing to evaluate and consider investment opportunities in the technology, travel, leisure and media sectors, is also evaluating the use and integration of Artificial Intelligence, Blockchain and Cryptocurrency into its chosen sectors and will only make investments in those areas which the Board believes will create value for shareholders.

I would also like to thank our shareholders and advisers for continuing to support the Board and our vision.

 

Simon Robinson
Chairman

8 May 2018

 

Interim Statement of Comprehensive Income
for the six months ended 31 March 2018

    Unaudited Unaudited
    six months ended six months ended
    31 March 2018 31 March 2017
  Notes £ £
       
       
Other income   13,250 17,096
Unrealised (loss)/gain on remeasurement  to fair value 3 (26,635) 178,121
       
Administrative expenses   (150,186) (143,794)
(LOSS) / PROFIT FROM OPERATIONS BEFORE FINANCING ACTIVITIES   (163,571) 51,423
       
Finance income   24 10,630
       
(LOSS) / PROFIT BEFORE TAX   (163,547) 62,053
       
Tax   - -
       
(LOSS) / PROFIT FOR THE PERIOD   (163,547) 62,053
       
       
TOTAL COMPREHENSIVE (EXPENSE) / INCOME
FOR THE PERIOD
  (163,547) 62,053

Profit / (Loss) before tax and total comprehensive income / (expense) for the period are all attributable to the equity shareholders of the parent.

Profit / (Loss) per share      
Basic   (0.37)p 0.16p
Diluted   (0.37)p 0.14p

Income and profit from operations for the current period all derive from continuing operations.

 

Interim Statement of Financial Position
for the six months ended 31 March 2018

    Unaudited Audited
    31 March 30 September
    2018 2017
  Notes £ £
ASSETS      
       
Non-current assets      
       
Investments 3 3,898,848 3,875,483
    3,898,848 3,875,483
Current assets      
       
Trade and other receivables   70,400 62,980
Cash and cash equivalents 4 417,894 619,939
    488,294 682,919
       
TOTAL ASSETS   4,387,142 4,558,402
       
EQUITY AND LIABILITIES      
       
Equity      
Share capital 5 5,206,954 5,206,954
Share premium account   7,574,273 7,574,273
Retained earnings   (8,430,749) (8,267,202)
       
Total equity attributable to equity holders of the parent   4,350,478 4,514,025
       
Current liabilities      
Trade and other payables   36,664 44,377
Total liabilities   36,664 44,377
       
       
TOTAL EQUITY AND LIABILITIES   4,387,142 4,558,402

 

Interim Statement of changes in equity
for the six months ended 31 March 2018

         
    Share    
  Share Premium Retained  
  capital Account Earnings Total
         
  £ £ £ £
         
Audited as at 1 October 2016 2,582,954 7,617,273 (8,993,355) 1,206,872
         
Total comprehensive income for the period - - 62,053 62,053
Share issue 2,624,000 - - 2,624,000
Cost of new issue - (43,000) - (43,000)
         
Unaudited as at 31 March 2017 5,206,954 7,574,273 (8,931,302) 3,849,925
         
Audited as at 1 October 2017 5,206,954 7,574,273 (8,267,202) 4,514,025
         
Total comprehensive expenses for the period - - (163,547) (163,547)
         
         
         
Unaudited as at 31 March 2018 5,206,954 7,574,273 (8,430,749) 4,350,478

All equity is attributable to equity shareholders of the parent.

Share premium

Represents amounts subscribed for share capital in excess of its nominal value, net of directly attributable issue costs.

 

Interim Statement of Cash Flows
for the six months ended 31 March 2018

    Unaudited Unaudited
    six months ended six months ended
    31 March 2018 31 March 2017
    £ £
       
Operating activities      
(Loss) / Profit before tax   (163,571) 62,053
Loss / (Gain) on current fair value adjustment   26,635 (178,121)
       
Changes in working capital:      
Increase in trade and other receivables   (10,394) (16,543)
(Decrease) / Increase in trade and other payables   (4,739) 61,846
Net finance cost   - 195
       
Net cash used in operating activities   (152,069) (70,570)
       
Investing activities      
Interest received   24 15
Investments   (50,000) (1,708,955)
Net cash used in investing activities   (49,976) (1,708,940)
       
Financing activities      
Net proceeds from issue of shares   - 2,581,000
Interest paid   - (210)
       
Net cash received from financing activities   - 2,580,790
       
Taxation   - -
       
Net (decrease) / increase in cash and cash equivalents   (202,045) 801,280
       
Cash and cash equivalents at the start of the period   619,939 139,412
Cash and cash equivalents at the end of the period   417,894 940,692

 

Notes

The notes are available in the PDF download.

 

Page last up-dated: 8 May 2018