DGAP-News: net mobile AG / Key word(s): Final Results/Development of Sales net mobile AG reports significant losses in the financial year 2013 07.07.2014 / 15:27 --------------------------------------------------------------------- CORPORATE NEWS net mobile AG reports significant losses in the financial year 2013 EBIT registers a loss of EUR 47.6 million Operating losses total about EUR 7 million Turnover rises by 5% to EUR 130,497 thousand Dusseldorf, July 7, 2014 - One of the leading international providers of mobile value-added services and payment solutions, net mobile AG (ISIN: DE000813852) announced its results for the financial year 2013 today. Worldwide clients include national and global mobile telecommunication providers, media companies, portals, brand name companies as well as TV channels, for which complete white label solutions such as direct carrier billing and mobile television services are provided. During the previous reporting year, the Executive Board expected a negative result in the single millions combined with reduced sales for the financial year 2013. However, turnover in 2013 developed more positively than expected with EUR 130,497 thousand - mainly due to new customers in the mobile payment sector, and by attracting new customers for the products such as Direct Carrier Billing. Earnings before interest and taxes (EBIT) at EUR -47,586 thousand were, however, significantly lower than originally forecasted. The reason for this high deviation in earnings were exceptional depreciations on intangible assets totalling EUR 4,540 thousand. In addition, goodwill impairment of EUR 1,000 thousand was recorded in the Segment "Voice". Furthermore, this deviation was caused by significant increases in write-downs on receivables totalling EUR 34,000 thousand. The bulk of the allowance for write-downs stemmed from a bankruptcy declared by a customer of the net-m privatbank 1891 AG as the risk of default for a part of the asset portfolio is estimated to be more than 50%. However, this receivable was purchased by net-m's majority shareholder, DOCOMO Deutschland GmbH at its face value and therefore resulted in no cash impact on the net mobile Group. Consequently the actual operating loss for 2013 is a relatively small proportion and lies at about EUR 7 million. In the last financial year, the volume of depreciation increased by EUR 8,127 thousand to EUR 17,150 thousand. This is due to exceptional depreciation of EUR 4,540 thousand, further write-offs on self-developed software amounting to EUR 1,139 thousand and goodwill impairment of EUR 1,000 thousand in the Segment "Voice". The financial results weakened compared to the previous year by EUR 1,392 thousand to EUR 2,239 thousand. This is mainly due to the increase in exceptional depreciation on the book value of an at-equity-investment and other long-term financial assets. In order to keep up with new market conditions, net mobile AG has continued to invest in its existing systems despite the difficult financial situation. Investments - not counting investments in financial assets - rose to EUR 17,723 thousand (previous year EUR 19,985 thousand). The research and development activities of the net mobile Group remain at a very high level. The cost of proprietary software development work amounted to EUR 5.580 thousand (previous year: EUR 6,584 thousand) in the year 2013. Due to this special business model of in-house software development the net mobile Group achieved the highest added-value for the company and its shareholders. Following a decision of 30 November 2012, the Executive Board, with approval of the Supervisory Board, resolved to make use of an authorisation to increase the subscribed capital of the company by EUR 218,229.00 by the issue of 218,229 bearer shares to EUR 12,448,207.00. Other corresponding financial liabilities do not exist any more. The net mobile Group ended the 2013 financial year with a positive operating cash flow of EUR 89,981 thousand (previous year EUR 4,983 thousand). The investment cash flow, at EUR 33,817 thousand, (previous year EUR 20,924 thousand) is negative, whereas the cash flow from financing activities at EUR 43​,537 thousand, (previous year EUR 21,600 thousand) is positive. All in all cash and cash equivalents of the Group increased by EUR 99,751 thousand to EUR 130,579 thousand compared to the previous year mainly due to an increase of the customer deposits to net-m privatbank 1891 AG. Other non-banking businesses of the net mobile Group recorded negative cash flows, which was mainly covered by the strong financial support from net-m's majority shareholder. Personnel expenses have, as a result of restructuring in 2013, fallen by EUR 313 thousand to EUR 18,617 thousand. Since these staff cuts were carried out during the current financial year 2013, the actual impact of this measure will only become apparent until the end of the 2014 financial year. The restructuring and realignment of the net mobile Group in 2013, as well as the change of the new CEO on 20 March of this year, have resulted in the first signs of positive momentum. Edgar Schnorpfeil, the new CEO of net mobile AG sums it up as follows: "On the one hand we have given up various business activities and streamlined other business areas. In addition, we have closed branch offices other than our Dusseldorf headquarters, and reduced staff. On the other hand, we have successfully strengthened core areas, in particular the payment business, via targeted investment." The future outlook The Group will continue to focus on profitable areas, cut back on strategically irrelevant sectors, and expect to keep the strong support from net-m's majority shareholder to turn around businesses. As part of the corporate realignment background and the newly introduced organisational structure further efficiency measures will be pursued while developing profitable business in core areas further. The focus is very much on the development of existing partnerships with mobile service providers and OTT players like Google as well as the business with settlement services via mobile phone bills. As a result of these important steps the Board expects break-even results after accounting for interest and taxes, with a modest decline in turnover for 2014. The full annual report can be viewed from 07 July 2014 on the website www.net-mobile.com. About net mobile AG net mobile AG is a leading international full-service provider of mobile value added services and payment solutions. The company, founded in November 2000, is regarded as an innovation leader in the marketplace. Clients worldwide include national and global mobile telecommunication providers, media companies, online shopping portals, brand name companies and television networks, for which complete white label solutions such as direct carrier billing and mobile television services are provided. Since December 2009, NTT DOCOMO, INC. is the main shareholder with over 87% share ownership. For more information please visit www.net-mobile.com. If you have any further questions, we will be most happy to help. We will gladly establish a direct contact to the responsible person at net mobile AG. Contact Person Dennis Heisig net mobile AG Fritz-Vomfelde-Str. 26-30 DE 40547 Dusseldorf Tel: +49 (0) 211 970 20 - 344 Fax: +49 (0) 211 970 20 - 999 E-Mail: [email protected] Internet: www.net-mobile.com Follow us on Twitter: twitter.com/netmobileag End of Corporate News --------------------------------------------------------------------- 07.07.2014 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: net mobile AG Fritz-Vomfelde-Str. 26-30 40547 Düsseldorf Germany Phone: +49 (0)211 970 20-0 Fax: +49 (0)211 970 20-999 E-mail: [email protected] Internet: www.net-mobile.com ISIN: DE0008137852 WKN: 813785 Listed: Freiverkehr in Berlin, Hamburg, München (m:access), Stuttgart; Frankfurt in Open Market End of News DGAP News-Service --------------------------------------------------------------------- 276963 07.07.2014