7digital - two announcements

22 September 2019 - Press release

7digital (AIM: 7DIG) has made two announcements this morning:

 

1. Interim results for the six months ended 30 June 2019

H1 2019 Financial Summary

• Licensing revenue up 5% to £2.5m (H1 2018: £2.4m) pro forma excluding MediaMarktSaturn ("MMS"), TDC, and discontinued operations
• Overall gross margin up to 74% (H1 2018: 70%)
• Adjusted operating loss down 21% to (£2.0m) (H1 2018: (£2.6m)). After adding back costs capitalised and amortisation charged in 2018, which did not occur in 2019, the like-for-like adjusted operating loss improved by 51% to £2.0m (2018: £4.2m)
• Administrative expenses reduced by £3.5 million to £7.5m (H1 2018: £11.0m) post other adjusting items and capitalised costs
• £1.9m raised in June 2019 for working capital purposes
• Today announced further fundraising via subscription from existing and new shareholders of £1.9m and additional £1.0 million in intended future facility to secure working capital needs  
• This means the Company has raised nearly £5.0 million in funding over the past three months

 

H1 2019 Operational Summary

• Review of the business in April 2019 led to refocused business strategy to fully capitalise on 7digital's cloud-based streaming platform
• Sale of select technology from the Company and its Denmark subsidiary, 7digital ApS, and transfer of staff to TDC Group for a total consideration of €1.375m
• Licensing revenue growth from existing customer base
• Signed Dubset in March 2019 and announced partnerships with Access and Music Powered Games

 

Full announcement: https://www.investegate.co.uk/7digital-group-plc--7dig-/rns/half-year-report/201909200811060928N/

 

2. Subscription to raise £1.88m

7digital has conditionally raised gross proceeds of £1.88 million through a subscription of 937,900,000 new ordinary shares of 0.01 pence each ("Ordinary Shares"), (the "Subscription Shares") at a price of 0.2 pence per share (the "Subsciption Price") with certain new and existing investors (the "Subscription") and additional £1.0 million in intended future facility.

The Subscription is conditional upon the admission of the Subscription Shares to trading on the AIM Market of the London Stock Exchange plc ("AIM") becoming effective ("Admission").

Mark Foster, Senior Independent Non-executive Deirector of 7digital, said:

"We are delighted to have secured further funding from our supportive Chairman, Tamir Koch and non-executive director David Lazurus as well as new shareholders. On behalf of the Board, I would like to thank them for their continued support at this crucial time as this financing secures the Company's working capital needs as 7Digital prepares itself to embark on its next phase of development and achieve for the first time operational profitability in 2020. "

Paul Langworthy, Chief Executive Officer, of 7digital, said:

"The music industry has experienced continued growth, which has been led by the expansion in streaming services. Having reduced our operational costs and secured this new funding, we are in a good position to benefit from this industry trend and expedite the scale up of the business. With the additional financing we are able to implement our plan to build a new partner programme to drive new customer growth; expand sales and support in US Market as well as invest in market-driven product development thereby delivering sustained growth and shareholder value."  

Full announcement: https://www.investegate.co.uk/7digital-group-plc--7dig-/rns/subscription-to-raise--1-88-million/201909200812020931N/