TIDMESG
RNS Number : 2739I
eServGlobal Limited
24 March 2015
eServGlobal Limited (eServGlobal or the "Company")
AGM Statement
Sydney: 24 March 2015
eServGlobal (AIM: ESG & ASX: ESV), the provider of
end-to-end mobile financial services to emerging markets, held its
Annual General Meeting at 11am (AEDT) today in Sydney,
Australia.
At the meeting the following statement was provided to
shareholders on behalf of the Board:
"We are pleased to provide you with an overview of the 2014
financial year, which was a pivotal year for eServGlobal.
This has been a year of transition for eServGlobal. We
maintained our return to a positive full year EBITDA. Adjusted
EBITDA for 2014 was A$2.6m, compared to A$1.7m in 2013 but, due to
a number of delayed projects, we did not quite meet market
expectations.
We completed the creation of the HomeSend joint venture with
MasterCard and BICS in April 2014. The hub is open to new markets
and we are increasingly seeing the benefits of MasterCard's
marketing and distribution networks.
During 2014, HomeSend's strategic priority was to focus on
expanding the number of live corridors. The HomeSend international
remittance hub now has 659 live corridors (compared to 59 at the
same time last year and 486 only three months ago). The number of
sending countries today is 233, which compares to a total of 99
sending countries only three months ago (December 2014) and the
number of receiving countries is currently 32. In 2014 the number
of transactions increased by 600% year on year.
The integration of HomeSend into MasterCard's MoneySend has
begun and completion is expected this year. The partner marketing
programme is accelerating with recent campaigns from XpressMoney
and World Remit amongst others. The pipeline continues to grow and
is a strong mix of Money Transfer Operators ("MTOs"), mobile money
services and emerging digital players.
The Board's attention has been more recently focused on the
development of the core business. The business is well positioned
to capitalise on the predicted growth in mobile money in emerging
markets. We have continued to invest in our technology platform and
customer acquisitions. The increased mix of higher margin licence
business is forecast to increase as the core business moves to a
higher proportion of repeatable, high margin revenues and offering
the opportunity to extend sales to existing customers.
We have been diversifying our customer base to bring in a
greater mix of Financial Institutions to complement our strong
footprint with Mobile Network Operators ("MNOs").
Our customer footprint now includes presence in four of the Tier
1 operators (Zain, Orange, Ooredoo and Vodafone). This increasing
diversification in our customer base is allowing us to reduce
customer concentration and extend our geographic reach.
We continue to build our pipeline, and we entered 2015 with a
backlog 43 per cent higher than the same time last year.
To support the opportunity in our core business, we decided to
further invest in the development of our product, together with the
systems and processes to support customer delivery and service. We
have historically undertaken significant customisation of our
systems for our customers, the complexity of which has on occasion
led to delays and cost overruns. We are now focusing on a single
product platform which will offer rich features for our customers
but be more straightforward to deliver. The investment in the
platform will also address shortcomings we have recently identified
in our project delivery. To this end, in December 2014 we raised
A$5.5m though the placement of 10,000,000 shares. I would like to
thank our shareholders for their continued support.
The past year has also seen a number of changes to eServGlobal's
Board.
Duncan Lewis was appointed Chairman in July 2014. He was due to
be here this week but unfortunately, a personal matter has
prevented him from travelling.
Paolo Montessori stepped down as Chief Executive and Managing
Director at the beginning of March. The search for his successor is
progressing. We are using a global search firm and we have begun
interviewing selected candidates.
Stephen Blundell, who has been an executive director on the
Board since 2013, was appointed Chief Operating Officer in December
2014. We have appointed Andy Duffen as acting Vice-President,
Finance.
Overall, eServGlobal is currently trading in line with our
expectations, that being to produce revenues and EBITDA in 2015
that are at least equal to the 2014 financial year. The Board is
mindful that we are a company of two parts - an established core
business with increasing growth prospects and a start-up with high
growth potential. We keep under continuous review the best ways in
which to enhance shareholder value.
A focus of the Board is to strengthen and improve the
coordination of eServGlobal's Investor Relations activities to
address the needs of our international shareholder base.
We have a healthy pipeline of ongoing work in the core business,
which will positively impact FY2015. We continue to make strong
progress and are expanding our footprint within the Zain Group,
following the framework agreement announced in 2013 and now have
live services in Kuwait, Jordan and Saudi Arabia.
We have made good progress implementing our product strategy,
and in particular, we are steadily delivering the projects which
were delayed in the course of 2014. The challenges that we
experienced in project delivery were due to a combination of
several elements including project backlog from FY13, migration to
a new technology platform, deploying in challenging geographies and
regulatory delays in some markets.
We have completed development of our mobile money platform with
positive customer feedback received so far.
Since the beginning of the year, MasterCard announced two new
customers for HomeSend which were won through the MasterCard sales
team. These are the first customers to be brought by MasterCard and
demonstrates that they are now actively pursuing business for
HomeSend. We remain extremely positive about our investment in the
Joint Venture and the HomeSend Board is considering opportunities
to accelerate growth and capitalise on HomeSend's "first mover"
advantage. Seizing these opportunities may mean further investment
from the JV partners later in 2015. Identified opportunities for
acceleration include co-funded marketing initiatives to stimulate
subscriber demand, a new data centre and acquisition of a banking
licence. If these initiatives are approved the maximum total
contribution from JV partners would be EUR10M (eServGlobal's
contribution would be EUR3.5M).
Looking forward, we will aim to leverage our investment in our
best-in-class PayMobile platform to support our transition to a
product-led solution company and expand the number of subscribers
using our solutions.
We would like to thank all our shareholders for their support on
the journey so far, as well as all our employees for the effort and
hard work that has gone into building the Company to the position
it is today."
A further announcement with the results of the AGM votes will be
released after the close of the meeting. The presentation delivered
at the AGM is available on the Company's website at:
http://www.eservglobal.com/system/files/201503_eServGlobal_AGM_Presentation.pdf
About eServGlobal
eServGlobal (AIM: ESG, ASX: ESV) offers mobile money solutions
which put feature-rich mobile financial services at the fingertips
of users worldwide, covering the full spectrum of mobile wallet,
mobile commerce, recharge, promotions and agent management
features. eServGlobal invests heavily in product development, using
carrier-grade, next-generation technology and aligning with the
requirements of more than 65 customers in over 50 countries.
eServGlobal also builds on its extensive experience in the telco
domain to offer a comprehensive suite of sophisticated, revenue
generating Value-Added Services to engage subscribers in a dynamic
manner. eServGlobal is partnering with MasterCard and BICS to build
the HomeSend joint venture, the market leading international
remittance hub service based on eServGlobal technology and enabling
mobile money transfer in over 50 markets.
eServGlobal has been a source of innovative solutions for mobile
and financial service providers for 30 years.
For further information, please contact:
eServGlobal www.eservglobal.com
Tom Rowe, Company Secretary T: +61 2 8014 5050
investors@eservglobal.com
Canaccord Genuity Limited (Nomad www.canaccordgenuity.com
and Broker) T: +44 (0) 20 7523
Simon Bridges / Cameron Duncan 8000
/ Brendan Gulston
Charles Stanley Securities www.csysecurities.com
Dugald Carlean/Paul Brotherhood T: +44 (0) 20 7149
6000
Newgate Communications www.newgatecomms.com
Adam Lloyd / Jasper Randall T: +44 (0) 20 7653
9850
This information is provided by RNS
The company news service from the London Stock Exchange
END
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