Jaxsta Ltd (ASX: JXT) is a music company, serving customers in Australia, the United States, and the United Kingdom. The company intends to track people behind the music, comprising of artists, video directors, roadies, photographers, and producers. The group is headquartered in NSW, Australia. The company’s core platform, Jaxsta.com, is expected to launch in late 2019.
On 8th May 2019, the company announced the issue of 13.22 million fully paid ordinary shares at $0.25 per share. This represented a 9% discount to the closing stock price of the company on 3rd May 2019. The placement was made pursuant to Jaxsta’s 15% placement capacity. $3.3 million gross proceeds are expected to be raised after this placement. Bell Potter acted as a Lead Manager to the Placement and was supported by the company’s existing institutional shareholders.
The net proceeds of this issue will serve to the use of the below-mentioned purposes:
- As part of the company’s long-term business plan, the proceeds would pace up the launch of the Jaxsta Pro subscription service and Jaxsta API.
- Sales, marketing and other promotional events supporting the launch of Jaxsta.
- Systems and platform development of Jaxsta Pro.
- New API platform development.
- Towards the working capital.
The settlement is scheduled for Tuesday, 14th May 2019. The new shares are expected to be issued and commence trading on Wednesday, 15th May 2019. The new shares would be treated equally in every way as the company’s existing fully paid ordinary shares.
After the announcement of the issue of new shares, the suspension of trading of the securities was lifted.
The company has notified and invited its shareholders to the Extraordinary General Meeting (EGM). The EGM is scheduled to be held on Thursday, 13th June 2019 in Sydney.
As announced on 15th March this year, the company has entered into a digital product agreement with Universal Music Group and a commercial data access agreement with Warner Music Inc. JXT has identified potential future revenue opportunities via various platforms like website advertisement, sales of industry specific-reports and third-party affiliate sales. These revenues and other future revenues earned outside the company’s commercial API platform would be confirmed, forecasted and included under the Universal and Warner agreements.
According to the company’s quarterly report published on 26th April 2019 for the quarter ending 31 March 2019, net cash used in operating activities amounted to A$3,039k. The net cash used in investing activities was $22k; while the net cash used in financing activities amounted to $464k. The cash and cash equivalents at the end of the quarter were $1,710k. Total estimated cash outflows for the next quarter is A$2,111k.
As of 31st March 2019, JXT held 28 licensing data agreements and has reached a mass covering approximately 80% of the popular music industry. The group has been part of major conferences and award events.
Stock Price Information:
At market close on 8th May 2019, the stock of the company was trading flat at $0.275, with a market cap of $59.98 million. The six-month yield stands at 44.74%.
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