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TechFinancials reports 56% fall in revenues for the financial year



Fintech software provider of financial solutions TechFinancials Inc (LON:TECH) released its annual report for 2019.

TechFinancials’s annual report states that the financial year’s revenue reached $3.4 million for 2019 financial year, registering a 56% drop compared to $7.8 million in 2018.

The company reported Covid-19 situation has led to delays the annual general meeting in the development of the company’s 75% subsidiary, Footies, product.

The financial report highlights include:

  • Blockchain trading technology revenues reached $1.9 million, a 50% decrease, compared to 2018 when it was $3.8 million.
  • Core software licensing revenues were $0.6 million, falling by 54% compared to $1.3 million in 2018
  • Trading platform revenues reached $1 million, down by 63% compared to the previous year
  • EBITDA loss attributable to shareholders of $1.9 million, same as 2018.
  • In February 2019, the TechFinancials established Footies Ltd. in the UK, holding 75% of the shares.
  • Тhe company sold its entire shareholding in MarketFinancials for the amount of €100,000 in October 2019.
  • In December last year, the company’s 51% subsidiary, DragonFinancials, ceased its operation. TechFinancials no longer operates any B2C business in its traditional systems unit
  • In January this year, the shareholders pf the company approved the cancellation of admission of Ordinary Shares to trading on AIM and sole listing on the Aquis Stock Exchange.
  • In March 2020, the company exercised its option over Cedex Holdings Limited now will hold 97.3% of Cedex’ issued share capital (90.81% on a fully diluted basis).
techfinancials

TechFinancials invested resources in its subsidiary Footies for the development of a blockchain driven ticketing software and app, for Sports Venues and teams. Footies has continued to add new software components to serve Event Creators allowing them to establish and manage events while controlling the tickets. The Footies development expenses were included in the reports of 2019, however due to the uncertainty of the Covid-19 crisis, the company reversed the capitalised expenses and recognised them as development costs.

TechFinancials continues to support Cedex in the blockchain-related projects.

The company’s B2B division saw declining revenues last year, partly attributed to suffering the loss of its DragonFinancials revenues, its major customer. TechFinancials announced in December of last year its plans to close its 51% owned B2C subsidiary, DragonFinancials in order to focus their business efforts in the development of blockchain applications.

Due to continuing regulatory challenges facing traditional brokerage solutions business unit and the drop in corresponding revenues, the company decided to issue six months termination notice to its licensees in May. All B2B brokerage services activities in Techfinancials will be ceased by 1 November 2020 or earlier if the licensees choose to terminate before that time.

 

2019 2018
US$’000 US$’000
Revenue 3,418 7,764
Cost of sales (911) (1,650)
Gross profit 2,507 6,114
Expenses:
Research and development (2,177) (3,478)
Selling and marketing (648) (1,396)
Administrative (2,648) (3,499)
Other expenses (153) (41)
Impairment of goodwill  (2,606)  (2,434)
Operating Loss (5,725) (4,734)
Bank fees (31) (59)
Foreign exchange loss (58) (166)
Other financial (expenses) / income (10) 4
Financing expenses (99) (221)
Other expenses
Loss from a disposal of fixed assets (400)
Loss before taxation (6,224) (4,955)
Taxation (47) (85)
Loss for the year from continuing operations (6,271) (5,040)
Loss from discontinued operations (19) (35)
Capital gain from a sale of subsidiary
Gain / (loss) for the year from discontinued operations, net  46 (35)
Other comprehensive income
Total comprehensive Loss (6,225) (5,075)
Loss attributeable to:
Owners of the Company (5,774) (5,274)
Non-controlling interest (451) 199
Loss for the period (6,225) (5,075)

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TechFinancials reports 56% fall in revenues for the financial year

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