Interim Results, June 2001
18th Sep, 2001
Interim Results for the six months ended 30th June 2001
In the six months to the end of June 2001 the company has incurred
a loss of £87,386 (last year £92,909). This reflects the
continuing cost consciousness and tight focus on development by the
management. At the end of June we had a positive bank balance of
£3,248,047. With this healthy cash position we can expand
resources to commercialise our development with the confidence that we
are financially secure.
Technology and telecoms stocks have been hit by a severely adverse
investment climate and Forbidden Technologies' share price has
reflected this. However, unlike many companies who are suffering from
the disappointing pace of development of broadband links, with
narrowband still dominating the market beyond 2005, Forbidden
Technologies stands to benefit significantly. Its products provide
narrowband playback without the installation of a player and support
large pictures at full frame rate and high resolutions. Thus our
market opportunity and positioning becomes even more attractive.
As microprocessors continue to improve, mobile computing becomes
more accessible. This creates market opportunities for Forbidden to
introduce product for GPRS and 3G phones and PDAs (personal digital
assistants). As with broadband, the well publicised problems
surrounding the technical development of 3G is to Forbidden
Technologies' advantage. We are working on a native ARM version of our
codec and expect to have a first demonstration available, on the
popular Compaq iPAQ, in the near future. We are also working with the
Symbian operating system on the new Nokia 9210 mobile phone and we are
now one of the developer community for both Symbian and Nokia.
Our first Forbidden codec (Mark I), concentrated on delivering full
frame rate and large pictures over modems on typical (500Mhz) PCs. We
have continuously improved this product by reducing the data rate and
improving the picture quality. This codec, targeted at "talking
heads" videos is demonstrated on our website at
http://www.forbidden.co.uk/.
We are now in the exciting process of developing a new (Mark II)
codec using our valuable experiences of Mark I and the useful feedback
from our shareholder participants. This entirely new codec will have
higher picture quality, variable picture sizes and will support a much
wider range of content. We expect our starting version to be available
in a few months time. Our technology will be suitable for a large
range of applications due to its superior reach, quality and the
flexibility of the software that we are building. These features
include:
- Usability across multiple devices
- Flexible delivery, e.g. built into web pages,
pop-ups, and e-mails
- Automatic upgrades without requiring downloads
- Flexible picture sizes to support multiple devices
and features such as banner ads
We entered this year as a video compression technology
developer. In the following six months we have seen significant change
in our business. We have increased our management resources,
particularly with the appointment of Greg Hirst as our Business
Development Director. Greg has led an extensive internal project which
has mapped and prioritised the many market sector opportunities
available to Forbidden. This has resulted in the identification of
priority sectors upon which we will focus over the next period. The
combination of our focus on narrowband, a multi-device approach and
flexible delivery will make us more responsive to the changing growth
opportunities in the market.
We now have a balance of effort between the continuous and rapid
development of our compression technology and the advancing
commercialisation process. We are increasingly in partnership with
prospective customers so that we can develop end-to-end video
communication solutions appropriate to each opportunity. We expect
some of these opportunities to crystallise over the next few months,
particularly following the demonstration of the new codec.
I would commend you to visit and regularly revisit our website
(http://www.forbidden.co.uk/),
where we have now established a news section. This will contain both
public news announcements and market and company news. We plan to
develop the website as a dynamic window on our business, with
shareholders, customers and partners in mind.
The timing of the launch of Forbidden Technologies last year is
proving ever more prescient. Timing in technology markets is important
and as the "Wide World Waits" for a typical internet link to
be available on broadband, the continuous advance of our technology
will be providing ever more impressive video over existing narrowband
connections. This means that we have an even bigger opportunity to
fill the need that to date cannot be satisfied by broadband and given
the technical difficulties and the need for significant infrastructure
spend is unlikely to be met in the short term. As our commercial
development begins to take shape we are confident of both financial
stability and a bright future for the business.
Victor Steel
Chairman
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