TIDMEXR
RNS Number : 9162L
Engage XR Holdings PLC
11 September 2023
11 September 2023
ENGAGE XR Holdings Plc
("ENGAGE XR", the "Company", or the "Group")
Unaudited Interim Results
ENGAGE XR Holdings Plc, a leading Metaverse / Spatial Computing
technology company, is pleased to announce its unaudited interim
results for the six months ended 30 June 2023.
Financial Highlights:
-- Group revenue has continued to grow with H1 2023 revenue of
c.EUR2.1 million, an increase of 18% (H1 2022: EUR1.8 million)
-- ENGAGE revenue is the main driver of the increase with
revenue in the period of cEUR1.9 million, up 30% (H1 2022:
EUR1.5m)
-- ENGAGE revenue comprises 91% of H1 2023 total revenue (H1 2022: 83%)
-- Gross margin in H1 2023 was 93%, up 12% (H1 2022: 81%)
-- EBITDA loss was EUR2.1m (H1 2022: loss of EUR2.8m), with
Group administrative expenses being largely salary and associated
costs
-- Loss before tax was EUR2.2m, in line with expectations,
compared to a loss in H1 2022 of EUR2.8m
-- Cash balance at 30 June 2023 of EUR9.4m (30 June 2022:
EUR4.9m). The Group's cash position was significantly strengthened
in the period following an oversubscribed EUR10.5 million (EUR9.9
million net of expenses) fundraise in February 2023
Operational Highlights:
-- The Group continues to gain traction in the US. 54% of Group
revenue in H1 2023 has been derived from North America compared to
34% in H1 FY22 and 30% for FY22, following the deployment of the US
sales team during 2022
-- There has been a steady increase in the client base with more
than 220 active Enterprise and Education customers as at 30 June
2023 (31 December 2022: 190)
-- Ground-breaking concert hosted in ENGAGE in March 2023 by the
renowned musician, Norman Cook, aka Fatboy Slim ( Highlights Video
)
-- Following the launch of Lenovo(TM)'s new ThinkReality(TM) VRX
all-in-one virtual reality (VR) headset in June 2023, the Group
expects the benefits of its Lenovo hardware partnership to start
being seen in early Q4 2023
Post-period end Highlights:
-- Continued momentum being seen - June was our strongest ever
month for revenue generation, with July and August generating a
combined EUR1m in revenue.
-- 5,400 user K-12 education license deal signed with a US state
for a pilot programme. valued in excess of EUR300k
-- Successful employee onboarding event run with one of the world's largest banks
David Whelan, CEO of ENGAGE XR, said: " ENGAGE's client list,
user numbers and revenue continue to grow. Given the sharp global
decline in tech spend, this performance is an excellent endorsement
of the value that clients think that ENGAGE brings to their
businesses.
"Although there has been much said in the press about the push
for people to get back into the office, we are not seeing this
trend reflected in our figures. Remote hybrid work is here to stay
even if its two or three days a week for most. Quality talent want
flexibility in terms of their work/life balance. We don't see this
changing in the future but foresee a push against constant video
calls. This is where a platform like ENGAGE steps in, especially
for daily meetings such as standups and remote classes.
"The release and planned release of new VR headsets from Meta,
Lenovo, HTC and Apple will ensure a steady stream of new leads
coming into our inbox as more companies look at immersive
communications, spatial computing and metaverse services for the
first time."
Investor Meet Company Presentation
CEO David Whelan and CFO Séamus Larrissey will provide a live
presentation relating to the Group's interim results via the
Investor Meet Company platform on 11 September 2023 at 09:00am
(BST).
The presentation is open to all existing and potential
shareholders. Questions can be submitted pre-event via your
Investor Meet Company dashboard up until 9:00am the day before the
meeting or at any time during the live presentation.
Investors can sign up to Investor Meet Company for free and add
to meet ENGAGE XR Holdings Plc via:
https://www.investormeetcompany.com/engage-xr-holdings-plc/register-investor
This announcement contains inside information for the purposes
of the UK Market Abuse Regulation and the Directors of the Company
are responsible for the release of this announcement.
- Ends -
For further information, please contact:
ENGAGE XR Holdings Plc Tel: +353 87 665 6708
David Whelan, CEO info@engagexr.co
Séamus Larrissey, CFO
Sandra Whelan, COO
finnCap Ltd (Nominated Adviser & Joint Broker) Tel: +44 (0) 20 7220
Marc Milmo / Seamus Fricker / (Corporate 0500
finance)
Sunila de Silva / Harriet Ward (ECM)
Shard Capital Partners LLP (Joint Broker) Tel: +44 (0) 20 7186
Damon Heath / Erik Woolgar 9952
SEC Newgate (Financial Communications) Tel: +44 (0)7540 106
Robin Tozer / Tom Carnegie / Naz Zandi 366
engage@secnewgate.co.uk
About ENGAGE XR
ENGAGE XR Holdings plc (AIM: EXR) is a leading Metaverse /
Spatial Computing technology company focused on becoming a leading
global provider of virtual communications solutions through its new
fully featured corporate metaverse, ENGAGE Link. A demonstration
can be viewed here : ENGAGE The Spatial Computing Platform for
Enterprise
The Company also has a proprietary software platform, ENGAGE.
ENGAGE provides users with a platform for creating, sharing, and
delivering VR content for education, training, and online events
through its three solutions: Virtual Campus, Virtual Office, and
Virtual Events.
For further information, please visit: www.engagexrholdings.com
(LinkedIn: @Engage XR Holdings plc Twitter: @engage_xr)
Chief Executive's Review
HY Review
The first half has been in line with our expectations with the
number of clients and revenue increasing steadily . The period
finished strongly with June being our strongest ever month for
revenue generation with multiple new clients onboarded onto the
platform. We have continued to see good growth in new clients using
ENGAGE and this growth has helped to increase ENGAGE revenue by
just over 30% versus the same period last year. Platform sales now
make up 91% of total Group revenue.
We have secured new funding, created new partnerships, and have
more ENGAGE product lines, such as Athena A.I, coming out later
this year. We have increased our customer facing sales and support
teams in the US while reducing spending in most areas of the
business helping us towards our goal of reaching profitability in a
shorter time frame than previously envisaged.
Post-period Developments
Since the period-end, we have seen growth in both the education
and enterprise sectors, with a large US state purchasing over 5,000
educational licenses from ENGAGE to run a pilot programme.
Furthermore, one of the world's largest banks has been using the
platform extensively for onboarding new employees.
Lenovo
In September 2022, ENGAGE and Lenovo signed an agreement for
ENGAGE to be part of the new Lenovo VRX headsets, and for the Group
and Lenovo to collaborate for ENGAGE to be pitched to Lenovo's
largest clients for use. The Lenovo VRX was officially launched in
June 2023, and we expect to see some early revenue from this
partnership during Q4 as the Lenovo headsets starts to be sold into
Lenovo's enterprise customers. Lenovo has an extensive sales
network with which the ENGAGE team will be working with over the
coming months. Through this partnership, we look forward to
building relationships with some of the world's largest brands and
educational institutions.
Collaboration with Meta
The team at Meta have also been extremely active, collaborating
with the ENGAGE team over the last few months with a focus on
growing "Meta for Business" opportunities. Meta is set to release a
new VR/AR device called the Quest 3. This device is the successor
to the popular Quest 2 headset, which has sold over 20 million
units. The release date of Quest 3 has not been announced. However,
we have been working with Meta to ensure ENGAGE will work on this
new device so that ENGAGE users will be able to utilise its new
features.
This new device is more focused on Augmented Reality (AR). AR is
the ability to see the real world and overlay it with digital
objects. An example of AR passthrough can be seen via an updated
trailer for ENGAGE: ENGAGE The Spatial Computing Platform for
Enterprise
The Meta for Business team and ENGAGE have already successfully
worked together on a couple of larger deals this year, using their
older Quest 2 devices. We expect this working partnership to grow
with the release of the Meta Quest 3 in the coming months.
Apple Vision Pro
The Apple Vision Pro was announced on the 5 June 2023, and will
be Apple's first new product line in many years. The device has
impressive specifications and we expect ENGAGE to be able to fully
support the device when it arrives next year. Similar to the Quest
3, this device is focused on passthrough AR which we believe is the
direction most leading headset manufacturers will be taking. The
Company is already undertaking development work to ensure that
ENGAGE can utilise this new device to its maximum potential when it
is officially released.
We expect the Vision Pro to sell out when it hits stores,
however it is not priced for consumers, its aimed at developers
like the ENGAGE team, enterprise users and prosumers who can build
applications and be ready for a more consumer friendly device in
the future. This is the template for Apple hardware releases, and
we expect it to mark a significant shift in global adoption of
immersive technologies.
ENGAGE Link
ENGAGE Link, which is our Metaverse / Virtual Worlds service,
was released late last year. It has already attracted major
corporations to build their own personal worlds inside, such as
HSBC and 3M. As these are vast worlds, ENGAGE Link is typically
busy when virtual events such as the KIA car launch or the Fatboy
Slim VR concert we hosted are on. What is perhaps surprising is the
high demand for private virtual worlds for internal use and demos
by companies which are not accessible to the public. This side of
our metaverse offering is growing rapidly although many clients are
still creating public spaces including HTC, Pfizer, KPMG, Lenovo,
MTN, Adtalem, Pearson, St James' Place, BSI, Optima Domi, Lobaki,
Victory XR, University of Miami, and Stanford University.
Athena A.I
In January 2023, we announced the launch of Athena A.I., our
artificial intelligence assistant that integrates into ENGAGE.
Using Open AI programs, Athena A.I. can not only interact with
users verbally she can also interact with core ENGAGE systems, as
well as generate from simple voice commands, images and skyboxes,
which is imagery from a photo, texture, or rendered artwork. The
skybox is an essential component in virtual reality design - a
panoramic wrapper that projects an entire background scene onto the
client's interface.
Our development team continues to enhance Athena A.I's
capabilities but this program has enhanced our product offering and
Athena A.I is already extremely smart, rapidly creating training
scenarios from simple verbal prompts. You can view this raw
captured video from inside a Meta Quest Pro interacting directly
with Athena here
None of this video was scripted and the topic was chosen at
random. Athena A.I has been designed as a solution for our
enterprise clients to be used for employee onboarding, sales calls,
education, training and much more. We will be updating Athena A.I
extensively over the coming months.
Outlook
We are optimistic about the second half where traditionally Q4
has been our busiest growth period when most contract renewals take
place. We are encouraged by the pipeline with H2 potentially
delivering some interesting additional revenue opportunities for
ENGAGE from the work we are doing with Meta and Lenovo.
The immersive tech industry is starting to mature. The step away
from immersive technology being geared solely towards gaming
applications is evident with Apple, Lenovo and Meta all looking to
expand the application of their respective headsets to include
enterprise and collaboration, which in turn will generate
opportunities for ENGAGE.
We look to the next six months with optimism and remain hungry
to deliver returns to our investors by delivering long term
sustained growth.
David Whelan
Chief Executive Officer
11 September 2023
Financial Review
Revenue for the half year is up 18% on the prior half year to
EUR2,075k (H1 2022: EUR1,757k), driven by a continued acceleration
in revenue from the ENGAGE platform.
ENGAGE revenue as a percentage of total revenue grew
significantly in the period and comprised 91% of total revenue in
the period (H1 2022: 83%).
EBITDA loss was EUR2.1m (H1 2022: loss of EUR2.8m). The primary
cost driver for the EBITDA loss is salary and associated costs,
currently approximately EUR0.5m per month.
Loss before tax was EUR2.2m, in line with management
expectations, compared to a loss in the prior year of EUR2.8m.
The combination of operating cashflows and capital expenditure
in H1 2023 were EUR2.8m compared to EUR2.9m in H1 2022 . The cash
balance at 30 June 2023 was EUR9.4m (30 June 2022: EUR4.9m). The
Group's cash position was significantly strengthened in the period
following an oversubscribed EUR10.5 million (EUR9.9 million net of
expenses) fundraise in February 2023. The management team are fully
focused on managing the cash position of the Group and remain very
cost conscious as the Group moves towards cash flow profitability
in the future.
Séamus Larrissey
Chief Financial Officer
11 September 2023
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2023
Unaudited Unaudited
Six months Six months
ended ended
Note 30 June 2023 30 June 2022
EUR EUR
Continuing Operations
Revenue 2,075,015 1,757,438
Cost of Sales (139,080) (337,244)
-------------- --------------
Gross Profit 1,935,935 1,420,194
Administrative Expenses (4,122,701) (4,200,985)
-------------- --------------
Operating Loss (2,186,766) (2,780,791)
Finance Costs (876) (17,524)
-------------- --------------
Loss before Income Tax (2,187,642) (2,798,315)
Income Tax Credit - -
-------------- --------------
Loss for the Year from continuing
operations (2,187,642) (2,798,315)
============== ==============
Loss per share
Basic from continuing operations 4 (0.005) (0.010)
Consolidated Statement of Financial Position
As at 30 June 2023
Unaudited Unaudited Audited
as at as at as at
30 June 30 June 2022 31 Dec 2022
Note 2023 EUR EUR
EUR
Non-Current Assets
Property, Plant &
Equipment 103,976 105,228 96,085
Intangible Assets 2 12,298 206,841 39,492
-------------
116,274 312,069 135,577
Current Assets
Trade and other receivables 1,444,904 1,087,352 1,365,982
Cash and short-term
deposit 9,446,893 4,900,780 2,209,169
------------- -------------- -------------
10,891,797 5,988,132 3,575,151
============= ============== =============
Total Assets 11,008,071 6,300,201 3,710,728
------------- -------------- -------------
Equity and Liabilities
Equity Attributable to Shareholders
Issued share capital 5 524,826 290,451 290,451
Share premium 5 43,910,062 33,503,300 33,503,300
Other reserves (12,346,163) (11,764,028) (11,752,741)
Retained earnings (21,748,294) (16,354,082) (19,560,652)
------------- -------------- -------------
Total Equity 10,340,431 5,675,641 2,480,358
------------- -------------- -------------
Non-Current Liabilities
Operating lease liabilities 19,076 3,582 -
------------- -------------- -------------
Current Liabilities
Trade and other payables 634,080 612,378 1,222,488
Operating lease liabilities 14,484 8,600 7,882
------------- -------------- -------------
648,564 620,978 1,230,370
============= ============== =============
Total Liabilities 667,640 624,560 1,230,370
------------- -------------- -------------
Total Equity and
Liabilities 11,008,071 6,300,201 3,710,728
============= ============== =============
Consolidated Statement of Changes in Equity
At 30 June 2023
Attributable to Equity Shareholders
Share Share Other Retained
Capital Premium Reserves Earnings Total
EUR EUR EUR EUR EUR
---------- ----------- ------------- ------------- ------------
Balance at 1 January
2022 290,451 33,503,300 (11,775,474) (13,555,767) 8,462,510
Loss for the period - - - (2,798,315) (2,798,315)
Share option expense - - 11,446 - 11,446
---------- ----------- ------------- ------------- ------------
Balance at 30 June
2022 290,451 33,503,300 (11,764,028) (16,354,082) 5,675,641
========== =========== ============= ============= ============
Attributable to Equity Shareholders
Share Share Other Retained
Capital Premium Reserves Earnings Total
EUR EUR EUR EUR EUR
---------- ----------- ------------- ------------- ------------
Balance at 1 January
2023 290,451 33,503,300 (11,752,741) (19,560,652) 2,480,358
Loss for the period - - - (2,187,642) (2,187,642)
Issue of ordinary
shares 234,375 10,406,762 - - 10,641,137
Issue costs - - (601,361) - (601,361)
Share option expense - - 7,939 - 7,939
---------- ----------- ------------- ------------- ------------
Balance at 30 June
2023 524,826 43,910,062 (12,346,163) (21,748,294) 10,340,431
========== =========== ============= ============= ============
Consolidated Statement of Cash Flows
For six month period ended 30 June 2023
Unaudited Unaudited
Six months Six months
ended ended
30 June 30 June
2023 2022
Note EUR EUR
Cash Flows from Operating Activities
Loss before income tax (2,187,642) (2,798,315)
Adjustments to reconcile loss before
tax to net cash flows:
Depreciation 40,246 34,730
Amortisation 27,194 219,613
Finance Costs 876 17,524
Share Option Expense 7,939 11,446
Movement in Trade & Other Receivables (78,922) (441,462)
Movement in Trade & Other Payables (588,408) 130,802
------------ ------------
(2,778,717) (2,825,662)
Bank interest & other charges paid (876) (17,524)
------------ ------------
Net cash used in operating activities (2,779,593) (2,843,186)
------------ ------------
Cash Flows from Investing Activities
Purchases of property, plant & equipment (15,435) (37,883)
------------ ------------
Net cash used in investing activities (15,435) (37,883)
Cash Flows from Financing Activities
Proceeds from issuance of ordinary
shares 5 10,039,778 -
Payment of operating lease liabilities (7,026) (8,211)
------------ ------------
Net cash generated/(used) from
financing activities 10,032,752 (8,211)
------------ ------------
Net increase/(decrease) in cash
and cash equivalents 7,237,724 (2,889,280)
Cash and cash equivalents at beginning
of period 2,209,169 7,790,060
Cash and cash equivalents at the
end of period 9,446,893 4,900,780
============ ============
Notes to the Interim Report
1. Basis of Preparation
The consolidated interim financial statements have been prepared
in accordance with the recognition and measurement principles of
International Financial Reporting Standards as endorsed by the
European Union ("IFRS") and expected to be effective at the
year-end of 31 December 2023.
The accounting policies are unchanged from the financial
statements for the year ended 31 December 2022. The interim
financial statements are unaudited and do not constitute statutory
accounts within the meaning of Section 434 of the Companies Act
2006. Statutory accounts for the year ended 31 December 2022,
prepared in accordance with IFRS, have been filed with the
Companies Registration Office. The Auditors' Report on these
accounts was unqualified.
The consolidated interim financial statements are for the 6
months to 30 June 2023.
The interim consolidated financial information does not include
all the information and disclosures required in the annual
financial statements and should be read in conjunction with the
Group's annual financial statements for the year ended 31 December
2022, which were prepared in accordance with IFRS's as adopted by
the European Union.
2. Summary of Significant Accounting Policies
New standards, interpretations and amendments adopted by the
Company
No new standards or amendments have been adopted for the first
time in these financial statements:
Intangible Assets
Research costs are expensed as they are incurred. Development
costs that are directly attributable to the design and testing of
identifiable and unique commercial software controlled by the
Company are recognised as intangible assets when the following
criteria are met:
- it is technically feasible to complete the software product so
that it will be available for use and sale;
- management intends to complete the software product and use or sell it;
- there is an ability to use or sell the software product;
- it can be demonstrated how the software product will generate future economic benefits;
- adequate technical, financial, and other resources to complete
the development and use or
- sell the software product are available; and
- the expenditure attributable to the software product during
its development can be reliably
- measured.
Directly attributable costs that are capitalised as part of the
software product include the software development employee costs
and subcontracted development costs.
Other development expenditure that does not meet these criteria
is recognised as an expense as incurred.
Development costs previously recognised as an expense are not
recognised as an asset in a subsequent period.
Computer software development costs recognised as assets are
amortised over their estimated useful lives, which do not exceed 3
years and commences after the development is complete and the asset
is available for use. Intangible assets are amortised over their
estimated useful lives based on the pattern of consumption of the
underlying economic benefits. Amortisation is included in
'Administrative Expenses'.
2. Intangible Assets
Software
in development
Costs Total
EUR EUR
Cost or Valuation
At 1 January 2023 2,136,231 2,136,231
Additions - -
---------------- -----------
At 30 June 2023 - -
---------------- -----------
Amortisation
At 1 January 2023 2,096,739 2,096,739
Charge 27,194 27,194
---------------- -----------
At 30 June 2023 2,123,933 2,123,933
---------------- -----------
At 30 June 2023 12,298 12,298
At 31 December 2022 39,492 39,492
---------------- -----------
Software
in development Total
Costs EUR
EUR
Cost or Valuation
At 1 January 2022 2,136,231 2,136,231
Additions - -
----------------- -----------
At 30 June 2022 2,136,231 2,136,231
----------------- -----------
Amortisation
At 1 January 2022 1,709,777 1,709,777
Charge 219,613 219,613
----------------- -----------
At 30 June 2022 1,929,390 1,929,390
----------------- -----------
At 30 June 2022 206,841 206,841
At 31 December 2021 426,454 426,454
----------------- -----------
The software being developed relates to the creation of three
virtual reality experiences and an online virtual learning and
corporate training platform.
ENGAGE is an online virtual learning and corporate training
platform currently in development by the Company. A desktop version
was released in December 2018 and the mobile version was released
in December 2019. Amortisation commenced when the mobile version
launched.
Amortisation expense of EUR 27,194 (H1 2022: EUR219,613) has
been charged in 'Administrative Expenses'. An impairment review was
carried out at the balance sheet date. No impairment arose.
3. Share Based Payments
Share-based payment schemes with employees
There were no employee options granted during 2023 (2022:
285,714). Options granted in 2022 were at an exercise price of
EUR0.175 per share and these vest subject to continued service by
the employee over a period of 3 years. Options expire at the end of
a period of 7 years from the Grant Date or on the date on which the
option holder ceases to be an employee.
Share-based payment expense with Director
There were no share options granted during 2023 (2022: Nil) to
Directors.
The movement in employee share options and weighted average
exercise prices are as follows for the reporting periods
presented:
2018 Scheme
Half-Year Half-Year
2023 2022
At 1 January 4,404,127 4,118,143
Granted during period - 285,714
Forfeited during period (248,148) -
At 30 June 4,155,979 4,404,127
Options outstanding at 30 June
Number of shares 4,155,979 4,404,127
Weighted average remaining contractual
life 1.10 1.71
Weighted average exercise price per share EUR0.041 EUR0.047
Range of exercise price EUR0.0001 EUR0.0001
- EUR0.20 - EUR0.20
Exercisable at 30 June
Number of shares 2,670,265 2,718,413
Weighted average exercise price per share EUR0.029 EUR0.031
The expense recognised in respect of employee share based
payment expense and credited to the share based payment reserve in
equity was EUR7,939 (2022: EUR11,446)
4. Loss per share
Unaudited Unaudited
Six months Six months
ended ended
30 June 30 June
2023 2022
Loss attributable to equity holders EUR EUR
of the Group:
Continuing Operations (2,187,642) (2,798,315)
Weighted average number of shares
for Basic EPS 446,584,479 290,101,146
Basic loss per share from continuing
operations (0.005) (0.010)
5. Share Capital
Number of Ordinary Share
shares shares premium Total
EUR EUR EUR
At 1 January 2023 290,451,146 290,451 33,503,300 33,793,751
Ordinary Shares Issued 234,375,000 234,375 10,406,762 10,641,137
At 30 June 2023 524,826,146 524,826 43,910,062 44,434,888
----------- -------- ---------- ----------
Forward-Looking Statements
Certain statements made in this announcement are forward-looking
statements. These forward-looking statements are not historical
facts but rather are based on the Company's current expectations,
estimates, and projections about its industry; its beliefs; and
assumptions. Words such as 'anticipates,' 'expects,' 'intends,'
'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions
are intended to identify forward-looking statements. These
statements are not guarantees of future performance and are subject
to known and unknown risks, uncertainties, and other factors, some
of which are beyond the Company's control, are difficult to
predict, and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking
statements.
The Company cautions security holders and prospective security
holders not to place undue reliance on these forward-looking
statements, which reflect the view of the Company only as of the
date of this announcement. The forward-looking statements made in
this announcement relate only to events as of the date on which the
statements are made. The Company will not undertake any obligation
to release publicly any revisions or updates to these
forward-looking statements to reflect events, circumstances, or
unanticipated events occurring after the date of this announcement
except as required by law or by any appropriate regulatory
authority.
- ENDS -
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IR FLFIRAIITIIV
(END) Dow Jones Newswires
September 11, 2023 02:00 ET (06:00 GMT)
Engage Xr (LSE:EXR)
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Engage Xr (LSE:EXR)
過去 株価チャート
から 5 2023 まで 5 2024
