blinkx PLC Announces Results for the Six Months Ended 30 September, 2008

blinkx PLC Announces Results for the Six Months Ended 30 September, 2008

blinkx Reports Record Results for the Half Year, Ahead of Analyst Consensus on all Fronts

blinkx's Interim Period Conference Call Will be Webcast live at http://www.blinkx.com on 10 November 2008, at 9:00 a.m. GMT/4:00 a.m. EDT/1:00 a.m. PDT

CAMBRIDGE, England and SAN FRANCISCO, November 10/PRNewswire-FirstCall/ -- blinkx PLC (BLNX.L), the world's largest video search engine, today
reported financial results for the six months ended 30 September 2008.

Financial Highlights

Six months to Period from 23 April
30 September (incorp.) to 30
2008 September 2007
(unaudited) (unaudited)
US$'000 US$'000

Revenues 6,359 2,953
Gross Profit 4,506 2,186
Loss from operations before
demerger / IPO costs * (4,278) (2,288)
Loss for the period before
demerger / IPO costs * (3,259) (1,407)
Loss for the period (3,259) (12,862)

Loss per share (cents) cents cents
Basic (1.17) (5.62)
Adjusted * (1.17) (0.62)

Cash used by operating activities
excluding demerger /IPO costs ** (4,705) (2,047)
Cash used by operating activities (4,705) (8,417)
Cash balance as at 31 March 2008 32,433 43,610

* period from 23 April to 30 September 2007 excludes
demerger / IPO costs of $11.455m
** period from 23 April to 30 September 2007 excludes
demerger / IPO costs. See cash flow statement.

Highlights:

- Strong revenue growth up 115% to $6.4m from first half FY08***

- Top and bottom line performance ahead of analyst consensus

- Gross profits up 106% to $4.5m from first half FY08***

- Unique visitors up 106% year on year to 64 million and page views up
267% year on year to 668 million in September 2008 (source: comScore)

- Cash balances of $32.4m at period end

- Daily Video Search run rate of over 7,000,000 per day in September 2008

- Content hours increased 78% year on year, from 18.5 million to 32
million

- 70 new content partners added, bringing total to over 420 media
organizations, including Getty Images, Time Inc. and CBS

- Addition of top-tier syndication partners, including ITN, MSN UK and
Rambler

- Introduction of four new strategic technology offerings:

- blinkx Red Label

- blinkx Remote

- blinkx 3D

- blinkx Broadband Television (BBTV)

- Successful execution of campaigns for leading advertisers, including
Coke, Exxon, and Mercedes

*** first half FY08 contains 23 weeks of trading

Commenting on the interim results Suranga Chandratillake,
founder and CEO of blinkx, said: "We are pleased to report a very strong
performance this period, with both revenue and bottom line ahead of analyst
consensus. In the last six months we continued to demonstrate significant
momentum on all fronts - introducing four new products, signing a host of
top-tier partners including ITN, MSN UK and Getty Images, and realizing
substantial advertising revenues though the blinkx AdHoc platform. With a
681% growth in traffic between June 2007 and July 2008 in the UK alone,
blinkx has cemented its position as the remote control for online
television."

Mr. Chandratillake continued: "While the macro environment
demands a conservative view, with pressure on advertising reported by major
players in the market, blinkx has benefited from the strong secular growth in
online video. Over the past 12 months, online video has undergone a sea
change - what was once the domain of short-form, user-generated material, has
become the realm of prime time television content. This year, major networks
and media companies committed to the Internet as a distribution mechanism for
their premium programming. As the world's largest, most advanced video search
engine, blinkx is ideally positioned to help audiences navigate this broad,
fragmented universe of high-quality programming. In addition, blinkx's AdHoc
advertising platform continues to attract advertisers drawn to our
technology's unique ability to provide targeted, action-oriented advertising
within a video context.

Mr. Chandratillake concluded: "We have taken a conservative
view of the macro situation and balanced that against the strong growth of
the online video market. We therefore believe that in spite of the current
macro-economic conditions, we expect blinkx to be able to report continued
strong growth in the second half and beyond."

Financial Highlights

For the first half 2009 (six months ending 30 September 2008),
revenues totaled $6.4 million increasing 115% over the $3.0 million in
revenues reported for the period from 23 April (incorporation) through 30
September 2007 which contained 23 weeks of trading. Gross profit for the
first half of FY2009 was $4.5 million representing a gross margin of 71%.
Gross profit for the period from 23 April through 30 September 2007 was $2.2
million, representing a gross margin of 74%. Net loss for the first half of
FY2009 was $3.3 million. Net loss for the period from 23 April through 30
September 2007, before non-recurring costs related to the IPO and demerger,
was $1.4 million (including non-recurring costs: $12.9 million). Loss per
share for the first half of FY2009 (adjusted and unadjusted) was 1.17 cents.
Adjusted loss per share for period from 23 April through 30 September 2007,
before one-off costs related to the IPO and demerger was 0.62 cents
(unadjusted: 5.62 cents). blinkx's cash balance at 30 September 2008 was
$32.4 million.

Customer and Business Developments

Strong demand for blinkx's unique, patented search
functionality has further cemented blinkx's position as the gold standard in
video search this period. High-profile new syndication customers included
Microsoft (MSN UK), Brazilian media company Elo Audiovisual, AnSearch and
Russia's largest portal, Rambler.

In the past six months, blinkx has grown its roster of premier
media partners to over 420, including the addition of programming from
industry leaders such as Getty Images, Time Inc. and CBS.

blinkx AdHoc, the first contextual advertising platform for
online TV, has gone from strength to strength in the first six months of
FY2009, powering advertising campaigns for top brands such as Puma and
Smirnoff. Moreover, based on the success of its initial campaigns on
http://www.blinkx.com, leading news organization ITN augmented the scope of
its advertising partnership with blinkx during the period. Under the terms
of the extension agreement, ITN is using AdHoc to serve contextual video
advertisements on the ITN website and its syndication partner sites,
including Bebo.com.

blinkx's index of fully searchable online video has now
surpassed 32 million hours, increasing 73% in the last 12 months, from 18.5
million hours.

Product and Technology Developments

During the first six months of FY2009 blinkx continued to lead
the industry with unique and disruptive product launches, introducing four
new offerings based on its patented technology. Highlights included the
release of blinkx Broadband Television (BBTV) in April 2008, blinkx Remote in
August 2008, and a Web-based version of BBTV in September 2008.

blinkx Remote is an advanced tool for finding full-length TV
episodes on the Web. It aggregates information and access to full-length
television programs on the Internet, offering audiences a single gateway for
finding TV shows by channel, season, episode, title or genre, both quickly
and legally.

blinkx was also first-to-market with a Web-based version of
its broadband television product, blinkx BBTV. blinkx BBTV in the browser
fuses a high-quality TV experience with the interactive power of the Web,
without any software download.

In July 2008, blinkx, began to syndicate its video search
capabilities through blinkx Red Label - an offering that deploys blinkx's
patented video search technology on customers' sites, enabling them to derive
new revenue through advertising.

In addition, blinkx announced the availability of blinkx 3D to
capitalize on the growing popularity of 3-D virtual worlds. Gartner Research
predicted that 80% of all active Internet users will have a virtual-world
presence by 2011 and blinkx 3D establishes a beachhead from which blinkx will
continue to develop its presence and participation in these types of online
communities.

Company Developments

During the period blinkx experienced dramatic expansion in its
user base to 64 million unique visitors in September 2008 from 56 million
unique visitors in March 2008. (source: comScore), and was recognized by
third-party research and reporting firms as one of the fastest growing
websites on the Internet. According to Compete.com, blinkx is the fastest
growing video site among the top 20 video competitors in the U.S. In another
report, Nielsen Online listed blinkx.com as the ninth fastest growing site in
the U.K. as its traffic soared 681% between June 2007 and July 2008.

Operationally blinkx expanded during the past six months to
support growth and new initiatives, increasing headcount to 52 employees at
30 September 2008. Key individuals joined the blinkx sales team in order to
capitalize on the thriving online video advertising market. In addition,
blinkx grew its executive management team with the appointment of Jonathan
Spira as Chief Financial Officer, a seasoned executive with over 20 years of
experience in the technology and media industries.

About blinkx PLC

blinkx (London AIM: BLNX) is the world's most comprehensive
video search engine. Today, blinkx has indexed more than 32 million hours of
audio, video, viral and TV content, and made it fully searchable and
available on demand. blinkx's founders set out to solve a significant
challenge - as TV and user-generated content on the Web explode,
keyword-based search technologies only scratch the surface. blinkx's patented
search technologies listen to - and even see - the Web, helping users enjoy a
breadth and accuracy of search results not available elsewhere. In addition,
blinkx powers the video search for many of the world's most frequented sites.
blinkx is based in San Francisco and London. More information is available at
http://www.blinkx.com

BLINKX PLC

CONSOLIDATED INCOME STATEMENT (UNAUDITED)

Results for the six months to 30 September 2008

(in thousands, except per share amounts)

Period from 23
Six months to 30 April (incorp.)
September 2008 to 30 September
(unaudited) 2007 (unaudited)
US$'000 US$'000

Revenue: continuing operations 6,359 2,953
Cost of revenue (1,853) (767)
Gross profit 4,506 2,186

Operating expenses
Research and development (2,170) (1,314)
Sales and marketing (6,054) (2,567)
Administrative expenses (560) (593)
Loss from operations before demerger
/ IPO costs* (4,278) (2,288)
Demerger / IPO costs - 11,455
Loss from operations (4,278) (13,743)

Interest revenues 863 881

Loss before taxation (3,415) (12,862)

Taxation 156 -

Loss for the period attributable to
equity holders of the parent
before demerger /IPO costs * (3,259) (1,407)

Loss for the period attributable to
equity holders of the parent (3,259) (12,862)

Loss per share (cents) Cents Cents
Basic and diluted (1.17) (5.62)
Adjusted* (1.17) (0.62)

* Period from 23 April to 30 September 2007
excludes demerger / IPO costs of $11.455million

BLINKX PLC

CONSOLIDATED BALANCE SHEET (UNAUDITED)

As at 30 SEPTEMBER 2008

(in thousands)

As at 30 As at 30
September September
2008 2007

(unaudited) (unaudited)
US$'000 US$'000
ASSETS

Non-current assets
Intangibles 6 4
Property, plant and equipment 431 480
437 484

Current assets
Trade receivables 5,216 1,194
Other receivables 1,936 1,654
Cash and cash equivalents 32,433 43,610
39,585 46,458
Total assets 40,022 46,942

Current liabilities
Trade and other payables (4,546) (2,172)

Net assets 35,476 44,770

Shareholders' equity
Share capital 5,487 5,483
Share premium 49,126 49,126
Stock compensation reserve 7,229 5,562
Currency translation reserve (2,820) 1,685
Merger reserve (4,323) (4,323)
Retained earnings (19,223) (12,763)
Total equity 35,476 44,770

BLINKX PLC

CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)

Results for six months ended 30 September 2008

(in thousands)

Period from
23 April
Six months (incorp.)
to 30 to 30
September September
2008 2007
(unaudited) (unaudited)
US$'000 US$'000

CASH FLOWS FROM OPERATING ACTIVITIES
Loss from on-going operation * (4,278) (2,288)
Demerger & IPO costs - (11,455)
Loss from operations (4,278) (13,743)
Adjustments for:
Depreciation and amortisation 118 147
Share based compensation 800 5,676
Foreign exchange gains (273) (3)
Operating cash flows before movements
in working capital (3,633) (7,923)
Changes in operating assets and liabilities:
Increase in trade and other receivables (3,595) (2,666)
Increase in trade and other payables 2,523 2,172
Cash used in operating activities (4,705) (8,417)

Non recurring share based compensation - (5,085)
Demerger / IPO costs - 11,455
Net cash used by on-going operating
activities* (4,705) (2,047)

CASH FLOWS FROM INVESTMENT ACTIVITIES
Interest received 863 700
Purchase of property, plant and equipment (103) (632)
Net cash generated by investment activities 760 68

CASHFLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of shares 4 50,384
Net cash generated by financing activities 4 50,384

Net (decrease)/ increase in cash and
cash equivalents (3,941) 42,035

Beginning cash and cash equivalents 39,436 -
Effect of foreign exchange on cash and
cash equivalents (3,062) 1,575
Ending cash and cash equivalents 32,433 43,610

* Period from 23 April to 30 September 2007 excludes demerger / IPO costs
of $11.455 million

BLINKX PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

For the six months ended 30 September 2008

(in thousands)

Ordinary Share Stock Currency
share premium compensation translation
capital account reserve reserve Sub-total
US$'000 US$'000 US$'000 US$'000 US$'000

Balance as at 1
April 2008 5,483 49,126 6,429 516 61,554
Issue of shares 4 - - - 4
Current period losses - - - - -
Exchange differences on
translation - - - (3,336) (3,336)
Credit to equity for
share based payments - - 800 - 800

Balance as at 30
September 2008 5,487 49,126 7,229 (2,820) 59,022

Sub-total Merger Retained
forwarded reserve earnings Total
US$'000 US$'000 US$'000 US$'000

Balance as at 1 April 2008 61,554 (4,323) (15,964) 41,267
Issue of shares 4 - - 4
Current period losses - - (3,259) (3,259)
Exchange differences on
translation (3,336) - - (3,336)
Credit to equity for share
based payments 800 - - 800

Balance as at 30 September
2008 59,022 (4,323) (19,223) 35,476

BLINKX PLC

NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of preparation

The interim financial statements have been prepared using
accounting policies consistent with those used in the statutory financial
statements for the year ended 31 March 2008 and International Financial
Reporting Standards ("IFRSs") as adopted for use in the European Union. While
the financial information included in this interim announcement has been
compiled in accordance with the recognition and measurement principles of
IFRSs, this announcement does not itself contain sufficient information to
comply with IFRSs. These interim financial statements do not constitute
statutory financial statements within the meaning of section 240 of the
Companies Act 1985.

Statutory financial statements for the year ended 31 March
2008 are available on the Group's website http://www.blinkx.com and have
been filed with the Registrar of Companies. The Group's auditors issued a
report on those financial statements that was unqualified and did not
contain a statement under section 237(2) or section 237(3) of the Companies
Act 1985.

The information for the six month period to 30 September 2008
is unaudited, but reflects all normal adjustments which are, in the opinion
of management, necessary to provide a fair statement of results and the
Group's financial position for and as at the period presented. The results of
operations for the period ended 30 September 2008 are not necessarily
indicative of the operating results for future operating periods.

2. Share-based payments

Included within operating expenses are the following amounts
in respect of share based payments:

Period from
23 April
(incorp.)
Six months to 30
to 30 September
September 2007
2008
(unaudited) (unaudited)
US$'000 US$'000

Research and development 430 320
Sales and marketing 313 228
Administrative expenses 57 42
Demerger / IPO - 5,233
800 5,823

3. Taxation

An income tax credit of $156,000 (period from 23 April to 30
September 2007: $nil) is reflected in the income statement in relation to
research and development tax credits.

4. Loss per share

The loss per ordinary share and diluted loss per share are
equal because share options are only included in the calculation of diluted
earnings per share if their issue would decrease the net profit per share or
increase the net loss per share. The calculation is based on information in
the table shown below.

Period from
23 April
Six months (incorp.)
to 30 to 30
September September
2008 2007
(unaudited) (unaudited)
US$'000 US$'000

Earnings
Loss (used in calculation of
basic and diluted loss per share) (3,259) (12,862)
Loss for the period excluding, in
period 23 April to 30 September 2007,
demerger / IPO costs of $11,455k (3,259) (1,407)
(used in calculation of adjusted loss
per share)

Number of shares
Weighted average number of shares 278,023,261 228,685,216

5. Share capital

The issuance of shares relates to the exercise of employee
share options.

INDEPENDENT REVIEW REPORT TO BLINKX PLC

We have been engaged by the Group to review the interim set of
financial statements in the half-yearly financial report for the six month
period to 30 September 2008 which comprises the consolidated income
statement, the consolidated balance sheet, the consolidated cash flow
statement, the consolidated statement of changes in equity and related notes
1 to 5. We have read the other information contained in the half-yearly
financial report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in the interim
set of financial statements.

This report is made solely to the company in accordance with
International Standard on Review Engagements 2410 issued by the Auditing
Practices Board. Our work has been undertaken so that we might state to the
company those matters we are required to state to them in an independent
review report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the
company, for our review work, for this report, or for the conclusions we have
formed.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible for
preparing the half-yearly financial report in accordance with the AIM Rules
of the London Stock Exchange.

As disclosed in note 1, the annual financial statements of the
Group will be prepared in accordance with IFRSs as adopted by the European
Union. The interim set of financial statements included in this half-yearly
financial report has been prepared in accordance with the accounting policies
the group intends to use in preparing its next annual financial statements.

Our responsibility

Our responsibility is to express to the Group a conclusion on
the interim set of financial statements in the half-yearly financial report
based on our review.

Scope of Review

We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim
Financial Information Performed by the Independent Auditor of the Entity"
issued by the Auditing Practices Board for use in the United Kingdom. A
review of interim financial information consists of making inquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with International
Standards on Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant matters that
might be identified in an audit. Accordingly, we do not express an audit
opinion.

Conclusion

Based on our review, nothing has come to our attention that
causes us to believe that the accompanying interim financial information is
not prepared, in all material respects, in accordance with the AIM Rules of
the London Stock Exchange.

Deloitte & Touche LLP
7 November 2008
Chartered Accountants and Registered Auditor
Cambridge, United Kingdom

For further information please contact:

Financial Media Contact
Edward Bridges/Haya Chelhot
Financial Dynamics
Tel: (UK) +44(0)20-7831-3113

Analyst and Investor Contact
Jonathan Spira, CFO
blinkx PLC
Tel: (US) +1-415-615-1513

AIM Nominated Adviser and Broker
Charles Lytle
Citigroup Global Markets

Source: blinkx plc

Deloitte & Touche LLP
7 November 2008
Chartered Accountants and Registered Auditor
Cambridge, United Kingdom
For further information please contact: Financial Media Contact: Edward Bridges/Haya Chelhot, Financial Dynamics, Tel: (UK) +44(0)20-7831-3113; Analyst and Investor Contact: Jonathan Spira, CFO, blinkx PLC, Tel: (US) +1-415-615-1513; AIM Nominated Adviser and Broker, Charles Lytle, Citigroup Global Markets

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