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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Seeing Machines Ltd | AQSE:SEE.GB | Aquis Stock Exchange | Ordinary Share | AU0000XINAJ0 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 5.25 | 3.00 | 7.00 | 5.25 | 4.25 | 5.25 | 202,888 | 16:29:58 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
TIDMSEE
RNS Number : 1467Q
Seeing Machines Limited
16 October 2023
Seeing Machines Limited ("Seeing Machines" or the "Company")
16 October 2023
Year End Results - FY2023
Increasing global regulatory momentum targeting key transport sectors underpins significant growth
Seeing Machines Limited (AIM: SEE, "Seeing Machines" or the "Company"), the advanced computer vision technology company that designs AI-powered operator monitoring systems to improve transport safety, has published its audited financial results for the year ended 30 June 2023 ("FY2023" or "the period").
FINANCIAL HIGHLIGHTS:
- Revenue increased by 48% to US$57.8m (2022: US$38.7m), ahead of market expectations[1]
- Non-Recurring Engineering (NRE) increased 53% to US$9.7m (2022: US$6.4m) - a lead indicator for future royalty revenue
- Annual Recurring Revenue as at 30 June 2023 increased by 27% to US$13.6m (2022: US$10.7m)
- Total OEM revenue, including both Automotive and Aviation, increased by 153% to US$26.6m (2022: US$10.5m)
- Automotive royalty revenues increased by 91% to US$7.6m (2022: US$3.9m) - Aftermarket revenue increased by 10% to US$31.2m (2022: US$28.4m) - Royalties from Guardian hardware sales of US$2.4m (2022: US$3.6m) - Gross Profit of US$28.9m represents increase of 65% (2022: US$17.5m) - EBITDA improved to a loss of US$9.3m (2022: loss of US$16.3m) - Strong balance sheet, with cash[2] at 30 June 2023 of US$36.1m (2022: US$40.5m)
Paul McGlone, CEO of Seeing Machines, commented : "The global demand for our technology has delivered strong growth in FY2023, despite some challenges and delays. Our three business units are now well established, and we are expecting to see continued growth from each of them as we move closer to compliance deadlines in Europe, where every vehicle on European roads will require technology to mitigate risks associated with fatigue and distraction. Seeing Machines is working directly with commercial vehicle OEMs to increase the installation of Guardian technology as factory-fit (After Manufacture) and with transport and logistics operators as retrofit, our more traditional application. In Automotive, while programs are taking longer to be awarded, we expect there to be fewer, larger awards given the Euro NCAP and GSR dates looming. And finally, in the growing Aviation business, we are working with world-leading Collins Aerospace following the announcement of our exclusive collaboration. The combination of these factors lead to revenue expectations in FY26 of not less than US$125m.
At end September, we can report a cash balance of US$30.8m and expect to achieve a cash break-even run rate during FY25 from our increasing focus on revenue growth and cost management."
OPERATIONS HIGHLIGHTS:
- Martin Ive appointed as CFO bringing significant public company experience
- Regulatory momentum continues to accelerate as compliance dates for Europe's General Safety Regulation to enhance road safety approach; and the US ramps up activity to incorporate safety legislation requiring technology to reduce risks associated with distracted and impaired driving
- The Company launched publication of quarterly Key Performance Indicators (KPI's) to report on growth across Automotive as cars start production and momentum in Aftermarket with Guardian connections and hardware sales
AUTOMOTIVE:
- Seeing Machines and Magna International entered into an exclusive, world-first collaboration to develop Driver and Occupant Monitoring System (DMS / OMS) technology integrated into the rear-view mirror, which included a US$65m investment in the Company via an exclusivity arrangement payment of US$17.5m and a convertible note of US$47.5m
- An additional program to deliver DMS / OMS for an existing European based global OEM brings total won awards to 15 across 10 individual OEMs, carrying an initial, cumulative lifetime value of US$321m with the majority of that revenue to be recognised over the period to 2028
- A total of 6 OEM programs have now started production, and at 30 June 2023, Seeing Machines' technology is installed in over 1 million vehicles globally
- Over the 12-month period to 30 June 2023, cars on road increased by 143% to 1,086,176 units (Q4 FY22: 447,225)
- Annual production volume increased 101% to 638,951 vehicles (FY2022: 317,491)
- Omnivision, a leading global developer of semiconductor solutions launched its OAX4600 system-on-chip (SOC) platform with interior sensing technology optimised with the Company's Occula(R) Neural Processing Unit
AVIATION:
- Seeing Machines signed an exclusive licence Agreement with Collins Aerospace generating licence revenue over three years of US$10m, to jointly develop pioneering eye-tracking solutions for the Aviation industry
- Collins will also pay the Company Non-Recurring Engineering (NRE) payments to develop specific solutions, which will evolve into potential future royalty payments as shipsets are released to customers
- With no competition in this space, today, this world-first collaboration brings together the companies' collective expertise in navigation, communication, sensor technology, flight controls and aviation system design to accelerate innovation and safety across the industry
AFTERMARKET:
- Monitored Guardian connections increased 30% during the last 12 months to 51,975 units (Q4 FY2022: 39,892)
- Total Guardian hardware sales for FY2023 of 14,779 units, with Q4 achieving record sales of over 10,000 units as backlog demand met following easing of earlier supply chain constraints
- After Manufacture Segment (factory-fit) developing into a key market for Guardian Gen 3, as European General Safety Regulation requires all new commercial vehicles to be fitted with technology to reduce risks of driver drowsiness in 2024, with requirements set to expand to distraction from 2026
- Seeing Machines is working with Mobileye to jointly target Aftermarket business globally, enhancing the Company's Guardian solution by incorporating the Mobileye suite of external facing Aftermarket products to alert drivers of potentially dangerous situations
RESULTS PRESENTATIONS
Sell-side Analyst Briefing - The Company will host an in-person briefing for analysts hosted by Paul McGlone, Chief Executive Officer and Martin Ive, Chief Financial Officer. This will take place at 9:00am BST on 16(th) October at the offices of Dentons Global Advisors.
Private Investor Presentation - Paul McGlone, Chief Executive Officer and Martin Ive, Chief Financial Officer, will provide a live presentation and Q&A via the Investor Meet Company platform on 16(th) October 2023 at 10:15am BST.
Enquiries:
Seeing Machines Limited +61 2 6103 4700 Paul McGlone - CEO Sophie Nicoll - Corporate Communications Stifel Nicolaus Europe Limited (Nominated Adviser and Broker) +44 20 7710 7600 Alex Price Fred Walsh Nick Adams Ben Burnett Dentons Global Advisors (Media Enquiries) James Styles Jonathon Brill seeingmachines@dentonsglobaladvisors.com +44 20 7664 5095
About Seeing Machines (AIM: SEE), a global company founded in 2000 and headquartered in Australia, is an industry leader in vision-based monitoring technology that enable machines to see, understand and assist people. Seeing Machines is revolutionizing global transport safety. Its technology portfolio of AI algorithms, embedded processing and optics, power products that need to deliver reliable real-time understanding of vehicle operators. The technology spans the critical measurement of where a driver is looking, through to classification of their cognitive state as it applies to accident risk. Reliable "driver state" measurement is the end-goal of Driver Monitoring Systems (DMS) technology. Seeing Machines develops DMS technology to drive safety for Automotive, Commercial Fleet, Off-road and Aviation. The company has offices in Australia, USA, Europe and Asia, and supplies technology solutions and services to industry leaders in each market vertical.
www.seeingmachines.com
Review of Operations
The Company's total revenue for the financial year (excluding foreign exchange gains and finance income) was US$57,771,000 compared to the 2022 revenue of US$39,000,000, representing a 48% increase on prior year results.
2023 2022 Variance Product US$'000 US$'000 % OEM 26,707 10,518 154 Aftermarket 31,064 28,482 9 -------- -------- --------
OEM revenue more than doubled compared to the previous corresponding period in line with the early stage ramp up of vehicle production for a number of Automotive OEM programs. Royalty revenues, derived from installation of Seeing Machines' Driver Monitoring System (DMS) technology, increased by 91% to US$7,580,000 from US$3,960,000 in FY22. The growth in royalty revenues in the OEM business has resulted in the revenue mix moving to a greater proportion of higher margin revenue streams, which is expected to continue as Automotive programs become the dominant source of revenue for this business unit. In FY23, the OEM operating segment entered into two key exclusive collaboration arrangements which earned licensing revenue of US$11,332,000 (2022: nil). The remainder of the revenue in the OEM segment primarily represents NRE (Non-Recurring Engineering) revenue which is software development activities undertaken to embed DMS technologies into the specific OEM configuration prior to the commencement of production. NRE revenue increased by 16% to US$6,766,000 (2022: US$5,850,000), and is a lead indicator of future royalty revenue.
Aftermarket hardware and installation revenue decreased by 2% over the prior year to US$14,495,000 (2022: US$14,722,000) which was due to limited hardware supply in the first half of the financial year. Connected Guardian units increased to 51,975 units in June 2023 representing 30% growth from 39,832 in June 2022. As a result of this growth, monitoring services revenue increased by 17% to US$11,117,000 (2022: US$9,512,000), continuing the accumulation of recurring revenue from the Guardian connections.
Gross profit increased from US$17,508,000 in FY22 to US$28,898,000 in FY23. Operational gross profit margin improved 5% year on year from 45% in FY22 to 50% in FY23 primarily reflecting increased high-margin OEM royalty and exclusivity licence revenues.
The Company continued to invest in its core technology development to further strengthen its competitive moat, rapidly expand features and leverage its unique systems approach across global OEM and Aftermarket industries. As a result, Seeing Machines has reflected a portion of development expenditure which meets recognition criteria as an intangible asset. During FY23, such development expenditure amounting to US$23,685,000 (2022: US$18,611,000) was capitalised and US$2,444,000 (2022: US$829,000) was amortised. The remaining research and development costs have been expensed and amount to US$11,264,000 (2022: US$11,251,000). The total investment in research and development for the current year amounting to US$34,949,000 (2022: US$29,862,000).
The resultant loss for the period represented a decrease of US$3,019,000 at US$15,548,000 (2022 loss: US$18,567,000).
Net cash and cash equivalents at 30 June 2023 totalled US$36,139,000 (2022: US$40,470,000).
On 4 October 2022, Seeing Machines received funding of US$47,500,000 from Magna International in the form of a non-transferable 4-year convertible note maturing in October 2026 (the "Convertible Note"). Details of the Convertible Note can be found in Note 21 to the Financial Statements. The proceeds of the Convertible Note are being used to meet technology demands, for general working capital and corporate purposes, as well as to strengthen the Company's balance sheet so that it is fully funded to deliver on its current business plan.
Operational Highlights
Seeing Machines continues to grow across all segments, now a well-recognised leader in the delivery of proven driver and occupant monitoring system technology with accelerated momentum achieved throughout FY23.
Martin Ive, CFO, was appointed to the Company in November 2022. Martin is a highly experienced finance professional and chartered accountant. He was previously the CFO for leading ASX-listed Altium Limited and is responsible for overseeing the global finance function and providing financial insights and information to guide strategic and operational decisions.
Regulatory tailwinds have increased demand across all road transport segments as Europe's General Safety Regulation (GSR2) is now in effect, and Euro NCAP (New Car Assessment Program) five-star system imminent for all cars sold across Europe, delivering a positive global impact on DMS fitment. The USA is ramping up its path towards a regulated requirement for driver assistance features, including DMS, to address distraction and impairment, in particular. Seeing Machines is working closely with rule-makers and other bodies in the USA to inform the protocols that underpin robust safety outcomes.
The introduction of quarterly Key Performance Indicators (KPIs) during the period has enabled the Company to demonstrate ongoing momentum as well as year on year growth for the Automotive and Aftermarket businesses. In Automotive, revenue has transitioned from low margin NRE to high margin royalty revenue as cars start production across a range of programs. Seeing Machines now has more than 1 million cars on the road (1,086,176) installed with DMS technology. This number is projected to grow substantially for the foreseeable future based on current programs and will further expand as more programs are awarded, currently under Request for Quote (RFQ). The value of current won business, based on initial minimum volumes stands at US$321m with the majority of that revenue to be recognised over the period to 2028.
A highlight during the period was the agreement between Seeing Machines Limited and Magna to exclusively co-market DMS/OMS integrated into the rear-view mirror. This location is predicted to experience the biggest growth across all markets and represents a big step-change for the Company. Working with one of the world's largest automotive tier-one suppliers, with a focus on mirrors, will enable Seeing Machines to increase market share as OEMs work hard to meet regulatory requirements, deliver a reliable driver and occupant monitoring solution and respond to the integration challenge inside the cabin.
In Aftermarket, Guardian connections have increased by 30% over the year to almost 52,000 global installations, contributing to expanding Annual Recurring Revenue (ARR) performance. With a historically low churn rate across this business, ARR is a very important contributor to overall Company revenue. Regulation, specifically in Europe with the GSR, is positively impacting the potential for increased Guardian connections and there has been good momentum in Europe with commercial vehicle manufacturers seeking to 'factory-fit' the technology in order to sell compliant vehicles across the continent, and globally. Seeing Machines is engaged with these customers and this additional segment ("After Manufacture") is now a key focus for the Company. The regulatory momentum has also seen increased interest in large multinational organisations and Seeing Machines will refocus on the USA as it launches its third generation Guardian technology early in 2024.
Seeing Machines signed an exclusive licence with Collins Aerospace, a Raytheon Technologies business, to jointly develop pioneering eye-tracking solutions for the global Aviation industry. Collins Aerospace is the world's largest Tier 1 Avionics company and has been working successfully with Seeing Machines for some years. Building on this history, the collaboration will enable the two companies to access the significant opportunity across aircraft and simulators of over US$700 million in the next 20 years, and to develop revolutionary fatigue management technology solutions to increase safety across this sector. The exclusivity will see Collins pay Seeing Machines US$10 million over three years as well as NRE payments that will cover development of solutions, evolving into potential future royalty payments as shipsets are released to customers.
Seeing Machines exists to get people home safely and now boasts three revenue generating business units that are contributing to that mission every day.
Significant changes in the state of affairs
During the financial year there was no significant change in the state of affairs of the Company other than those referred to elsewhere in this report and in the financial statements or notes thereto.
Seeing Machines Limited
Consolidated statement of financial position
As at 30 June 2023
Consolidated entity At 30 June 30 June 1 July 2023 2022 2021 Notes US$'000 US$'000 US$'000 Assets Current assets Cash and cash equivalents 10 36,139 40,470 35,541 Trade and other receivables 11 27,039 18,588 14,887 Contract assets 12 6,513 3,433 1,613 Inventories 13 11,191 933 1,970 Other financial assets 17 312 325 354 Other current assets 14 1,116 2,244 2,465 -------- -------- -------- Total current assets 82,310 65,993 56,830 -------- -------- -------- Non-current assets Property, plant and equipment 15 3,861 3,033 2,520 Right-of-use assets 26 1,853 2,376 7,154 Intangible assets 16 45,064 23,609 3,189 -------- -------- -------- Total non-current assets 50,778 29,018 12,863 -------- -------- -------- Total assets 133,088 95,011 69,693 -------- -------- -------- Liabilities Current liabilities Trade and other payables 18 11,646 11,290 6,629 Contract liabilities 20 4,634 2,495 579 Lease liabilities 26 708 653 688 Provisions 19 4,414 3,512 3,669 -------- -------- -------- Total current liabilities 21,402 17,950 11,565 -------- -------- -------- Non-current liabilities Borrowings 21 40,322 - - Lease liabilities 26 2,195 3,000 3,954 Deferred tax liabilities 7 2,464 - - Provisions 19 174 245 144 -------- -------- -------- Total non-current liabilities 45,155 3,245 4,098 -------- -------- -------- Total liabilities 66,557 21,195 15,663 -------- -------- -------- Net assets 66,531 73,816 54,030 -------- -------- --------
Seeing Machines Limited
Consolidated statement of financial position
As at 30 June 2023
(continued)
Consolidated entity At 30 June 30 June 1 July 2023 2022 2021 Notes US$'000 US$'000 US$'000 Equity Contributed equity 22 240,948 240,948 201,093 Other equity 23 5,749 - - Accumulated losses 24 (185,520) (169,972) (151,405) Other reserves 24 5,354 2,840 4,342 --------- --------- --------- Total equity attributable to owners of Seeing Machines Limited 66,531 73,816 54,030 --------- --------- ---------
Seeing Machines Limited
Consolidated statement of comprehensive income
For the year ended 30 June 2023
Consolidated entity Year ended 30 June 30 June 2023 2022 Notes US$'000 US$'000 Sale of goods 14,596 15,911 Services revenue 21,489 15,491 Royalty and licence fees 21,686 7,598 ---------- --------- Revenue 4 57,771 39,000 Cost of sales (28,873) (21,492) ---------- --------- Gross profit 28,898 17,508 Net foreign exchange gains 5 916 1,022 Other income 5 31 77 Expenses 6 Research and development expenses (11,264) (11,251) Customer suport and marketing expenses (6,477) (6,525) Operations expenses (12,865) (8,161) General and administration expenses (12,938) (11,167) ---------- --------- Operating loss (13,699) (18,497) ---------- --------- Finance income 691 282 Finance costs (2,571) (328) ---------- --------- Finance costs - net (1,880) (46) ---------- --------- Loss before income tax (15,579) (18,543) Income tax (expense)/benefit 7 31 (24) ---------- --------- Loss for the period (15,548) (18,567) ---------- --------- Loss is attributable to: Equity holders of Seeing Machines Limited (15,548) (18,567) ---------- ---------
Seeing Machines Limited
Consolidated statement of comprehensive income
For the year ended 30 June 2023
(continued)
Consolidated entity Year ended 30 June 30 June 2023 2022 Notes US$'000 US$'000 Loss for the period (15,548) (18,567) Other comprehensive income/(loss) Items that may be reclassified to profit or loss Exchange differences on translation of foreign operations 24 310 (5,137) ---------- --------- Other comprehensive income/(loss) for the period, net of tax 310 (5,137) ---------- --------- Total comprehensive income/(loss) for the period (15,238) (23,704) ---------- --------- Total comprehensive income/(loss) for the period is attributable to: Owners of Seeing Machines Limited (15,238) (23,704) ---------- --------- Cents Cents Loss per share for profit attributable to the ordinary equity holders of the Company: Basic loss per share 9(0.004) (0.004) Diluted loss per share 9(0.004) (0.004)
Seeing Machines Limited
Consolidated statement of changes in equity
For the year ended 30 June 2023
Employee Foreign Equity Currency Benefits Contributed Other Accumulated Translation & Other Total Equity equity Losses Reserve Reserve equity Consolidated entity Notes US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 Balance at 1 July 2021 201,093 - (151,405) (8,991) 13,333 54,030 ----------- -------- ----------- ------------ --------- -------- Loss for the period - - (18,567) - - (18,567) Other comprehensive loss - - - (5,137) - (5,137) ----------- -------- ----------- ------------ --------- -------- Total comprehensive loss - - (18,567) (5,137) - (23,704) ----------- -------- ----------- ------------ --------- -------- Transactions with owners in their capacity as owners: Shares issued 22 40,864 - - - - 40,864 Capital raising costs 22 (1,009) - - - - (1,009) Share-based payments 28 - - - - 3,635 3,635 ----------- -------- ----------- ------------ --------- -------- Balance at 30 June 2022 240,948 - (169,972) (14,128) 16,968 73,816 ----------- -------- ----------- ------------ --------- -------- Balance at 1 July 2022 240,948 - (169,972) (14,128) 16,968 73,816 ----------- -------- ----------- ------------ --------- -------- Loss for the year ended - - (15,548) - - (15,548) Other comprehensive loss - - - 310 - 310 ----------- -------- ----------- ------------ --------- -------- Total comprehensive loss - - (15,548) 310 - (15,238) ----------- -------- ----------- ------------ --------- -------- Transactions with owners in their capacity as owners: Share-based payments 28 - - - - 2,204 2,204 Value of conversion rights on convertible notes 23 - 5,749 - - - 5,749 ----------- -------- ----------- ------------ --------- -------- Balance at 30 June 2023 240,948 5,749 (185,520) (13,818) 19,172 66,531 ----------- -------- ----------- ------------ --------- --------
Seeing Machines Limited
Consolidated statement of cash flows
For the year ended 30 June 2023
Consolidated entity Year ended 30 June 30 June 2023 2022 Notes US$'000 US$'000 Cash flows from operating activities Receipts from customers (inclusive of GST) 52,183 37,961 Payments to suppliers and employees (inclusive of GST) (77,412) (49,543) Interest received 691 284 Interest paid (5) - Income taxes paid (496) (192) ---------- --------- Net cash (outflow) from operating activities 25 (25,039) (11,490) ---------- --------- Cash flows from investing activities Purchase for plant and equipment (1,703) (1,344) Payments for intangible assets (patents, licences and trademarks) (253) (257) Payment of intangible assets (capitalised development costs) (23,685) (18,611) Interest received on financial assets held as investments 13 - ---------- --------- Net cash (outflow) from investing activities (25,628) (20,212) ---------- --------- Cash flows from financing activities Proceeds from issues of new shares - 40,864 Cost of capital raising - (1,009) Proceeds from borrowings 47,500 - Transaction costs in borrowings (1,202) - Principal repayment of lease liabilities (1,005) (922) ---------- --------- Net cash inflow from financing activities 45,293 38,933 ---------- --------- Net (decrease) increase in cash and cash equivalents (5,374) 7,231 Cash and cash equivalents at the beginning of the financial year 40,470 35,541 Effects of exchange rate changes on cash and cash equivalents 1,043 (2,302) ---------- --------- Cash and cash equivalents at end of financial year 10 36,139 40,470 ---------- ---------
To read the FY2023 Annual Financial Report and access accompanying notes to the above tables, please visit https://www.seeingmachines.com/investors/announcements
[1] Consensus expectations for FY2023 are revenue of US$53.9m
[2] Working capital increased due to the timing of Guardian inventory deliveries, leading to an increased level of inventory and receivables at 30 June 2023. Inventory levels are sufficient to support demand for H1 FY2024 and will unwind along with receivables in the first half of FY24.
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END
FR FLFIDITLSLIV
(END) Dow Jones Newswires
October 16, 2023 02:00 ET (06:00 GMT)
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