REG - Fonix PLC - Trading Update and Special Dividend Declaration

FonixAnnouncement

23/01/2025 07:00

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RNS Number : 3574U  Fonix PLC  23 January 2025

Fonix plc

("Fonix" or the "Company")

Trading Update and Special Dividend

Portuguese strategic commercial partnership and special dividend

Fonix plc, the mobile payments and messaging provider, is pleased to provide
an update on trading for the 6 months ended 31 December 2024 (the "Period").

Financial highlights:

●     Gross profit and adjusted EBITDA(1) in H1 FY25 have grown in line
with management's expectations.

●     Gross profit in the Period grew by 6.5% to £9.8m (H1 FY24:
£9.2m).

●     Adjusted EBITDA(1) in the Period grew by 6.8% to £7.8m (H1 FY24:
£7.3m).

●     Fonix intends to pay an increased interim dividend in March 2025,
in line with the Company's progressive dividend policy to pay out at least 75%
of adjusted earnings per share.

Special dividend

●     In addition to the interim dividend, Fonix Plc is pleased to
announce the declaration of a special dividend, reflecting the Company's
continued robust financial performance and strong cash generation. The Board
has approved a payment of 3.0p per share, which will be paid on 12 February
2025 to those shareholders who are on the register at the close of business on
31 January 2025 (record date), with a corresponding ex-dividend date of 30
January 2025. This special dividend underscores our continued confidence in
our business model and our ability to generate sustainable returns for
stakeholders while maintaining a disciplined approach to capital allocation.

Operating highlights:

●     Contracts in place with all major mobile network operators in
Portugal, marking a significant milestone in expanding our international
reach. Additionally, the Company has entered into a strategic commercial
partnership with NOS, one of Portugal's leading telecommunications providers.
This collaboration strengthens the business' position in the market and will
enable it to deliver its Campaign Manager product to NOS' numerous existing
broadcast customers.

●     The Company has recently launched interactive services with News
UK, a prominent multinational media organisation, across its talkSPORT and
Virgin Radio brands in the UK.

●     The business continues to grow its product portfolio with the
recent launch of two innovative solutions, unlocking new revenue opportunities
from existing customers:

○     PayFlex: A cutting-edge tool that streamlines the recovery of
failed mobile payments by integrating Apple Pay, Google Pay, and PayPal.

○     DonationPortal: A tailor-made solution for charities, featuring
custom-branded donation pages, effortless Gift Aid processing, and real-time
analytics to boost donor engagement and simplify the giving process.

●     The business continues to accelerate its investment in organic
international expansion, and is in early discussions with a number of mobile
network operators and prospective broadcaster customers across several new
European markets, which the management team believe has the potential to
provide significant growth opportunities in the years ahead.

●     Michael Foulkes has recently been appointed CFOO (Chief Financial
& Operating Officer) of Fonix. This has been a natural evolution of his
role within the Company, and is required now due to the acceleration of our
international expansion goals at the same time as the broadening of our
product portfolio. Michael will have Board responsibility for product
development and delivery.

●     Total payment volume ("TPV") of mobile payments in the Period was
£150m (H1 FY24: £158m) due to fewer charity customer campaigns, a reduction
in some very low margin voice telephony services and the discontinuation of
some gambling customers who have exited the UK market.

●     100% platform uptime throughout the Period.

●     Fonix's key business segments of payments and messaging have both
grown in the Period and the business retains a growing pipeline of client
prospects going into H2 FY25.(2)

 

Outlook:

With high levels of existing recurring income, recent new customer wins, and
advanced partnership opportunities in Portugal, the Board anticipates a
stronger H2 weighting than usual and remains confident in meeting management
expectations for FY25. Additionally, with the business's expanding product
suite and clear growth opportunities in several other European markets, the
Board remains very confident in Fonix's long-term growth potential.

 

Rob Weisz, CEO, commented:

"We are delighted to have once again delivered strong progress on our growth
strategy. In Portugal, we have now secured contracts with all mobile network
operators and a strategic partnership with a leading telecommunications
provider, unlocking immediate opportunities to deliver Campaign Manager and
our other interactive services to their significant base of TV and radio
customers.

At the same time, we continue to make good progress on exploring new
opportunities in other European markets and advancing innovations on our
product roadmap, which we expect to drive revenue growth from FY26 onwards.
These achievements position us well for long-term success."

Notes:

 

All financials based on unaudited figures.

 

(1) Adjusted EBITDA excludes share-based payment charges along with
depreciation, amortisation, interest, research and development tax credits and
tax from the measure of profit.

(2) All financial numbers contained within this announcement are unaudited.

 

 

Enquiries

Fonix  plc
 
 Tel: +44 20 8114 7007

Robert Weisz, CEO

Michael Foulkes, CFO

 

Cavendish Capital Markets Limited (Nomad and Broker)
Tel: +44 20 7220 0500

Jonny Franklin-Adams / Seamus Fricker / Hamish Waller (Corporate Finance)

Sunila de Silva/ Harriet Ward (ECM)

The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU No.
596/2014) which is part of UK law by virtue of the European Union (Withdrawal)
Act 2018. Upon the publication of this announcement, this inside information
is now considered to be in the public domain.

About Fonix

Founded in 2006, Fonix provides mobile payments and messaging services for
clients across media, telecoms, entertainment, enterprise and commerce.

When consumers make payments, they are charged to their mobile phone bill.
This service can be used for ticketing, content, cash deposits and donations.
Fonix's service works by charging digital payments to the mobile phone bill,
either via carrier billing or SMS billing. Fonix also offers messaging
solutions.

Based in London, Fonix is a fast growth business driven by blue chip clients
such as ITV, Bauer Media, RTÉ, Global Media, Comic Relief and BBC Children in
Need to name a few.

 

 

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