TIDMVRE
RNS Number : 9564Z
VR Education Holdings PLC
16 January 2020
For immediate release 16 January 2020
VR Education Holdings plc
('VR Education' or the 'Group')
Trading Update
VR Education (AIM: VRE; Euronext Growth: 6VR), a leading virtual
reality ('VR') technology company focused on the education and
enterprise training space, provides the following trading update
for the year ended 31 December 2019 ('FY19').
Financial Update
Revenue for FY19 is expected to be c.EUR1.02 million. Although
this is an increase of 42% on the prior year (FY18: EUR0.72
million), it is below market expectations. The trajectory of
revenue growth has been affected by the delayed launch and the lack
of availability of mobile standalone headsets from the hardware
providers the Group works across. This has been resolved, and there
is a clear path for further ENGAGE and showcase revenue to be
generated in the current financial year and beyond. The underlying
dynamics are outlined in more detail in the Operational and Market
Update below.
The EBITDA loss in FY19 reduced to c.EUR1.49 million (FY18:
EUR1.54 million) and, due to strong cost control measures
implemented during 2019, is an improvement on market
expectations.
The cash balance of EUR1.29 million at 31 December 2019 is
higher than market expectations. The current cash burn rate, net of
revenue received, is approximately EUR0.2 million per month.
Operational and Market Update
2019 represented an important year of progress for VR Education.
Revenue increased by 42% compared to the prior year and the Group's
ENGAGE platform signed up its first customers after it was released
on PC-supported VR devices at the end of 2018. It was also the
first year in which quality standalone VR devices (VR without the
need for external computing or cabling) became available to
consumers, representing a significant change in the affordability
and accessibility of high-end VR hardware.
The lack of hardware available for potential business customers
during 2019 accounted for a substantial portion of the shortfall in
the Group's overall revenue target for the year, however, the Board
does not believe that this will be an issue for 2020 onwards as the
Group is working closely with several VR headset makers including
Pico, Facebook, HTC and Deutsche Telekom. With ENGAGE becoming
platform agnostic in early 2020, the Group can now finally service
many of the potential sales leads received during 2019 and which it
continues to receive today.
ENGAGE
The ENGAGE platform has seen many updates throughout the year
with a primary focus on supporting the new wave of VR standalone
devices. This makes it easier to deploy, service and utilise ENGAGE
in multiple areas of enterprise and education. Additional features
and content were added throughout the year with multiple lectures
from Oxford University and a library of 360 video content now
available to users. Also a variety of enterprise focused features
have been developed for ENGAGE which include but is not limited to
branding options, user administration, private hosting and security
updates. The Group is currently trialling the enterprise focused
features with a number of well-known corporations seeking mobile
deployment in 2020.
Pico Neo 2
The Pico Neo 2 is a standalone VR headset which provides more
processing power than the Oculus Quest. The Group has nearly
completed the work required to provide the ENGAGE platform on this
VR headset. Pico has agreed to produce headsets for the Group with
ENGAGE pre-installed.
Facebook's Oculus Quest
The importance of quality standalone VR devices for wider
adoption cannot be understated with the Oculus Quest VR headset,
developed by Facebook, being sold as quickly as they are
manufactured leading to worldwide shortages since its release. The
ENGAGE platform was ported over to support the Oculus Quest during
Q2/Q3-19 and has been available for potential clients to test since
September 2019. However, with all stock of Oculus Quest being sold
to retail customers, Facebook have pushed back their Oculus for
business initiative until Q2-20 while they build up stock. In
October 2019, the Group was invited by Facebook to become part of
its Oculus for business initiative via their Independent Software
Vendor programme. The Group signed up for this exclusive
arrangement with Facebook which will be fully deployed during
FY20.
Facebook is not the only company to have released quality
standalone hardware in 2019. The HTC Vive Focus Plus and Pico Neo 2
headsets are direct competitors to the Quest.
Sony's PlayStation VR headset
2020 will see Sony release the PlayStation 5 and a new version
of the PlayStation VR headset (PSVR), which will further expand the
high-end VR user base; the Group intends to support this device
with its current suite of showcase software.
Telecommunications Companies - Deutsche Telekom and HTC
Other telecoms companies are entering the arena with Deutsche
Telekom (T-Mobile) seeking to release hardware as part of its 5G
rollout. The Group has signed an agreement with Deutsche Telekom to
release ENGAGE on its new VR device for 2020 offering ENGAGE to all
its new 5G customers. The Group has also undertaken work, which is
now nearing completion, to provide the ENGAGE platform on the HTC
Vive Focus Plus standalone VR headsets.
Showcase Experiences
The Group's VR showcase experiences continued to sell strongly
on all platforms during 2019. In late 2019 the Group released
Shuttle Commander, a new VR showcase experience based on space
shuttle missions that was exclusive for the PlayStation PSVR. This
VR experience will be released during FY20 on PC, Oculus PC, Vive,
Steam, Windows MR and the Oculus Quest retail store.
A new revenue stream for experiences was opened during 2019 with
VR Education signing an agreement with the US Rocket and Space
Centre providing a museum version of the Group's popular Apollo 11
VR experience to visitors. This experience was in very high demand
during school holidays and in December the Group signed a twelve
month extension to the agreement. The Group is in discussions with
many other museums globally and hopes to close similar deals during
2020.
David Whelan, CEO of VR Education, said: "While it is
disappointing to not have grown revenues for FY19 at the pace
previously forecasted, we have grown in the year and made
significant progress which lays solid foundations for further
growth in FY20. With VR adoption becoming more mainstream through
the wider availability of new standalone VR devices, along with the
improvements that 5G deployment will bring, we are confident that
2020 will see an increase in demand for immersive experiences. As a
result, we believe that the Group will see continued strong growth
of sales of our VR showcase experiences as well as an accelerated
adoption of our ENGAGE platform for education and enterprise
clients, who are working closely with major telecom companies
providing 5G services for training and education."
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
- Ends -
For further information, please contact:
VR Education Holdings plc Tel: +353 87 665 6708
David Whelan, CEO contact@vreducationholdings.com
Sandra Whelan, COO
Cairn Financial Advisers LLP (Nominated Tel: +44 (0) 20 7213
Adviser) 0880
James Caithie / Liam Murray / Ludovico
Lazzaretti
Shore Capital (Joint Broker) Tel: +44 (0) 20 7408
Toby Gibbs / Anita Ghanekar 4090
Fiona Conroy
Davy (Joint Broker & Euronext Growth Tel: +353 1 679 6363
Advisor)
Fergal Meegan / Ronan Veale / Barry
Murphy
Buchanan (Financial PR) Tel: +44 (0)20 7466 5000
Henry Harrison-Topham / Chris Lane VRE@buchanan.uk.com
/ Tilly Abraham
Notes to Editors
VR Education, together with its wholly owned subsidiary, is an
early stage VR software and technology group based in Waterford,
Ireland, dedicated to transforming the delivery methods of
education and corporate training by utilising VR technologies to
deliver fully immersive virtual learning experiences. The Group's
core focus is the development and commercialisation of its online
virtual social learning and presentation platform called ENGAGE,
which provides a platform for creating, sharing and delivering
proprietary and third-party VR content for educational and
corporate training purposes.
In addition to the ongoing development of the ENGAGE platform,
the Group has also built two downloadable showcase VR experiences,
being the award-winning Apollo 11 VR experience and the Titanic VR
experience.
On 12 March 2018, VR Education listed on the AIM market of the
London Stock Exchange and on the Enterprise Securities Market, a
market regulated by Euronext Dublin. For further information,
please visit www.vreducationholdings.com.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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