24th Mar 2014 17:49
LONDON (Alliance News) - Monitise PLC Monday announced a fully-underwritten placing of 160.6 million new shares to accelerate its shift towards a subscription model, however it also lowered its revenue growth guidance for 2014.
Monitise did not disclose the price of the placing, which is being conducted by way of an accelerated bookbuilder process. It will be limited to certain institutional and other investors. It said that existing shareholders and its new partner, Mastercard, intend to participate.
It said that a third of the funds raised will be used on its identified platform spend, and depending on the timing of this spend, financial year 2014 capital expenses including capitalised research and development will be GBP20 million to GBP30 million, up from GBP14 million in 2013, and GBP30 million to GBP40 million in 2015.
The other two thirds will cover the cost ramp of the operating cost that will come from the adoption of the new model.
Monitise now expects its financial year 2014 revenue growth to be 40% compared to its previous guidance of 50%. This will lead to the second-half of 2014's earnings before interest, tax, depreciation and amortisation loss to be bigger than the first-half.
It expects financial year 2016 revenue growth, but at a lower rate than 2014. In 2016 it expects to be EBITDA profitable, which it said is a year later than current sell-side analyst consensus. It expects revenue growth to accelerate strongly in 2016.
The company also laid out new five year key performance indicator targets. It expects registered users to grow from 28 million to 200 million by the end of the financial year 2018.
Its average revenue per user target is at least GBP2.50 per year. It is targeting user generated revenue to represent around 80% of its total group revenue.
It is targeting a sustainable gross margin of above 70% with an earnings before interest, tax, depreciation and amortisation margin of at least 30%.
Monitise will commence the roll out of its Monitise Commerce Network, a payment and shopping network. It will also launch Monitise Signature Monday, which is a PCI-compliant data analytics engine.
Shares in Monitise closed down 0.7% at 71.73 pence Monday.
By Hana Stewart-Smith; [email protected]; @hanassallnews
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