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Preliminary Results for the year ended 30th June 2010 25 August 2010.

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Presentation on theme: "Preliminary Results for the year ended 30th June 2010 25 August 2010."— Presentation transcript:

1 Preliminary Results for the year ended 30th June 2010 25 August 2010

2 George Osborne in India Click to play 2

3 Agenda Introduction Market update Company update Finance update Summary

4 In troduction

5 Multi state roll out during the tax season The Network Effect New Media Age winner ‘Best Use of Mobile 2010’ UK iPhone launch Lloyds TSB “Say Hello” campaign Page number O2 16 apps press campaign 5

6 Overview Mobile money market - large, validated and fast-growing global market Monitise platform established as a market leader Gaining significant traction –Strong UK track record with platform already adopted by RBS Group, HSBC & Lloyds & available across all mobile phone networks –Customer base growing rapidly –International partners include Visa, SCB, Travelex & FIS –JVs in place to access fast-growing markets of USA, Asia Pacific & India 6

7 Overview Continued Strengthening of relationship with Visa –Equity investment increases shareholding to 14.4% –Extension of Global Alliance Agreement (GAA) and licensing of new strategic territories (Mexico and Russia) Cash raised provides funding for Group until cash generative –UK operations expected to reach cash break-even by December 2010 –Current live operations expected to reach cash break-even during FY12 Significant opportunity to cement leading international position 7

8 Market update

9 Mobile Money and the Opportunity Mobile Money is securely accessing your finances through your mobile phone Mobile Money gives you the freedom to bank and pay on the move –Direct connection to accounts –Ability to make payments/transfer funds The scale of the opportunity is enormous –There are 2.2 billion people using financial services in the world (Financial Access Initiative, McKinsey 2009) –There are 4.6 billion mobile phone users in the world (International Telecommunications Union, “Measuring the Information Society” 2010) The number of people who will make payments by mobile phones in 2010 – up from 70.2m in 2009 (Gartner, June 2010) The value of mobile payments by 2012, growing globally at 68% p.a. from 2008 (Arthur D Little, 2009) The number of subscribers who will use their phones for mobile banking by 2013 (Juniper Research, 2010) 400m 108.6m $250bn 9

10 Company update

11 Group Overview Global opportunity Blue chip business partners Adopted by major UK and other financial institutions Wide platform applicability Broad range of services Banking & payments touch the lives of billions of consumers worldwide From balance enquiry to instant payment Account management, payments, mCommerce Any phone, any network Via SMS, Java, Brew, Browser, iPhone, Blackberry, Android Global opportunity Blue chip business partners Adopted by major UK and other financial institutions Global opportunity Blue chip business partners Wide platform applicability Adopted by major UK and other financial institutions Global opportunity Blue chip business partners 11

12 - A Key Strategic Partner Visa Inc. A global leader in payments A key strategic partner for Monitise Mobile channel is a major strategic imperative for Visa Strengthening of Global Alliance Agreement (GAA) Equity investment increased to 14.4% in Monitise plc Extension of Global Alliance Agreement Term increased to 2015, minimum fee commitment increases from $13m to $16m Monitise to grant Visa Inc. license for further deployment in Mexico and Russia – licence fee of $1.5m anticipated for FY10/11 Appointment of Elizabeth Buse, Group Executive, International, for Visa Inc. to the Monitise Board 16,000 financial institution customers 1.8 billion Visa cards (31 Dec 2009) 64 billion total transactions $2.9 trillion payments volume Source: Visa website. Figures as of 31 March 2010 unless stated otherwise “Mobile – the next payments frontier” (Visa Inc.) 12

13 Our managed services make the complex simple… Patent Protected 12

14 Monitise Customer Propositions Customers who have multiple services Customers who have downloaded an app Customers who have registered for text alerts services Customers who have registered for account updates (via text) Typically customers who have registered for our pre-paid card and card activation services Advanced 28% Essentials 24% Feeder 48% (£7+ ARPU) (£2-3 ARPU) (<£1 ARPU) 14

15 Typical Feeder Services Debit and credit card activation by text Pre pay card balance notification Update and event confirmation text messages 15

16 Typical Essentials Services Pull an account Balance via text Weekly Text Update Low Balance Text Alerts Actionable Alerts Overdraft Sweep PayDay Sweep 16

17 Advanced Services App Stores: Apple, RIM, Ovi, Android Secure Browser alternative Bank Accounts, Prepaid Cards, Credit Cards Account Management Set & Manage Alerts Lock/ Unlock Cards Branch/ATM Locator Bill Present & Pay Payments: Pay Anyone & P2P Reloads: Airtime top-up Transit, Prepaid Cross Sales/CRM Prompts Loyalty 2FA for secure log in Stock Trading Coupons & Vouchers Lottery NFC Ready Live Future roadmap 17

18 Emerging new customer behaviour Advanced segment usage trends Banking channel of choice, with 16 transactions a month App usage highest between 7am and 9am (on the way into work) Usage peaks on Friday’s and Monday’s and at the end of the month (‘have I been paid yet?’) 90% of customers who download it, go on to use the app regularly 18

19 Unlocking the Potential Time UK 36m Consumers USA 212m Consumers India 230m+ Consumers Asia Pac (Inc China) 400m+ Consumers In the developed world, factors that drive addressable market are:  Adult population  % banked or with prepaid cards  % pop with mobile phone In the developing world, factors that drive addressable market are:  Adult population  % pop with mobile phone  % with banked or with prepaid cards but also offer an m-wallet for the unbanked if the regulations allow 19

20 Finance update

21 TECHNOLOGY Business Evolution Visa Global UK Americas Asia Pacific Africa India Live Operations Investment Areas 2007 2008 2011 2009 2012 2010 Live 21

22 Financial Summary Revenues Revenues of £6m, up from £2.7m in FY09 (↑125%) H2: £4.3m, up from £1.6m in H2 FY09 (↑170%) Transactional revenues gaining traction (↑490%) Live Operations Reducing losses from H1 to H2 Driving towards profitability UK operation on track to cash break-even by Dec 2010 Monitise Americas close to cash break-even Investments Increase in investment spend H1 to H2 Asia Pacific JV Enhancement of platform capability Growing appetite for mobile payments Retaining / extending our technological advantage Cash Cash balance of £13.2m at 30 June 2010 Cash balance, post fund-raising, in excess of £42m FY08 to FY10 Revenues by Type £m £1.5m £2.7m £6.0m H1 FY08 to H2 FY10 Transactional Revenues £m H1 FY 08 H2 FY 08 H1 FY 09 H2 FY 09 H1 FY 10 FY 08 H2 FY 10 FY 09FY 10 22

23 Segmental Performance – Year on Year *Before Share Base Payments/Exceptionals ** Prior year loss for live ops includes 50% share of Monitise Europe. Like for like Group operating loss is broadly flat year on year 23

24 Segmental Performance – FY10 H1/H2 Revenue & Loss Trend 24

25 Segmental Performance – FY10 H1/H2 Margin & Overhead Trend 25

26 Key Milestones Year to 30 June 2011  UK operation moves to cash break-even  Hong Kong launch  China pilot launch  India launch  First Monitise enabled Visa product launch  First Visa transactional revenues Year to 30 June 2012  All existing live operations at cash break-even (UK / N America / Visa)  First Indian transactional revenues  First deployment of live services in China  Further rollout within Asia Pacific region 2013 Onwards  Group cash generative  Major mCommerce launch 26

27 Summary Fast growing demand for mobile money worldwide Established market leader with 8 years of investment in technology and relationships Highly motivated team supported by experienced Board, strengthened by new appointments Blue chip partners & strategic investors –Facilitating global access –Deepening relationship with Visa Transactional revenues growing rapidly UK operations expected to reach cash break-even by December 2010 Fundraising enables Monitise to –Retain and extend its technological advantage –Fund new areas of operation –Take the Group to cash generation Right partners, right team, right technology, right time 27

28 Appendix

29 Global Footprint Monitise Americas Monitise Europe Monitise Africa Monitise Asia Pacific Monitise India JV with FIS to tackle world’s largest consumer markets Launched 2008 Over 200 financial institutions signed up Launched in 2006 UK as flagship home market before international roll out Significant customer growth in 2010 >55% of UK retail banking market coverage Available through all mobile networks Development underway supported by grant funding (Africa Enterprise Challenge Fund) Recent JV formed with First Eastern Showcase launch planned for Hong Kong as springboard into China New JV formed with Visa Inc. 29

30 Driving Transactions in a Mobile World Bank Accounts, Savings Accounts, Credit Card and other Accounts Financial Transaction Processors Consumer interface Enquiries Payments Information FIS VISA Payments VocaLink Payments Cheques POS 30

31 The Mobile Evolution If you don’t establish the secure link now it is lost Foundation for driving asset value Mass market self service channel Cost reduction & service enhancement Leverage payment infrastructure Defend payment position Phase 1 mCommerce Extend payment reach Network extension of A2A Cheque replacement Phase 2 mCommerce Mass market payments Importance of mobile commerce to the Banking industry Account information/money management Database MSISDN - PAN Account to account payment person to person payment “text money” mCommerce – Remote “text to buy” Vouchers & offers (add revenue) mCommerce - Proximity “NFC” 31

32 The number of mobile subscribers who use their phones for mobile banking will exceed 400m globally by 2013, according to a new in depth study by Juniper Research. This equates to double the number of users this year. Juniper Research, July 2010 'The number of people using their mobile phones to make payments is set to grow from 70.2 million in 2009 to 108.6 million this year, a 54.5% rise. Gartner, June 2010 'New types of SMS mobile banking alerts will help to treble the volume of mobile banking messages to almost 90 billion per annum by 2015, equating to one message every two days for every mobile banking user. Juniper Research, August 2010 Mobile Money will be a massive market ‘‘ 32

33 Emerging new behaviors % 33

34 Understanding their finances sets them up for a day 34

35 Appealing to a mass market 35

36 NatWest iPhone Proposition Q2 16 apps press campaign App store home page 36

37 August Lloyds TSB collateral 37

38 Example live apps. CSB Mobile Money PyraMax AmBank Mobi - ABT Health Mobile – Wealthcare HIB Mobile – Highlands Magna Mobile Stoneham bankAvidia Bank 38

39 Recent milestones October 2008: 1 st 1 million transaction month June 2009: Visa 5 year global alliance signed Aug 2009: Monitise breaks 750,000 customer barrier and takes 100% control of UK joint venture Dec 2009: Monitise breaks 1.5 million customer barrier March/April 2010: Monitise hits 2 million customers and JV in Asia Pacific agreed with First Eastern June 2010: Agreement signed with VISA for India JV Q2 ‘08Q4 ‘08 Q1 ‘09 Q4 ‘09 Q1 ‘10Q2 ‘10 July 2010: Further £32m raised on capital markets Q3 ‘10 Q2 ‘09 Nov 2009: Monitise launches Smartphone platform 39

40 Financial Results: Summary Cashflow Year ended 40

41 Leadership Team Alastair LukiesCEOCo-founder of Monitise; co-founder of (portal for Westminster, Whitehall and devolved institutions) John BroughamCFOFormerly FD of BT Transformation and BT Global Services Executive Team Duncan McIntyreNEDFormerly CEO of Morse plc David DeyNEDFounder of Energis, formerly BT PLC board member Colin TuckerNEDFormerly Deputy Chair Hutchison 3G & Technical Director Orange Peter RadcliffeNEDFormerly MD First Data Asia Pacific Elizabeth BuseNEDGroup Executive, international, for Visa Inc Jan VerplanckeNEDCIO of Standard Chartered Bank Non-Executive Directors Other Advisors : Lord Mervyn Davies, Lord Digby Jones, Christopher Rodrigues (ex President Visa International), Andrew Harrison (UK CEO The Carphone Warehouse ) Remove detail Lee CameronCCOFormerly General Counsel of Morse PLC Tom SpurgeonCo SecFormerly FD of Morse UK 41

42 Monitise: Investor Centre Share price22p (23 Aug 10) MarketAIM Ticker MONI.L Market cap. £151m (23 Aug 10) Ord. shares in issue 692,727,757 (23 Aug 10) Sub 3% holdings reflect increased base of institutional shareholders following recent placing (Standard Life, Fidelity, Schroders etc) *Shareholders as at 23 rd Aug 2010 42

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