REG - Seeing Machines Ltd - Half-year results and financial report
30/03/2022 07:00
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RNS Number : 5552G Seeing Machines Limited 30 March 2022
Seeing Machines Limited
30 March 2022
Half year results and financial report
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, today publishes its unaudited
results and financial report for the six months to 31 December 2021 ("H1
2021").
Financial Highlights:
- Total operational revenue of A$21.7m (H1 2021: A$18.1m), reflecting
comparative growth of c.19.4% on previous period.
o Underlying revenue growth 1 using constant currency is 24.6% year on year
(exchange rate as at 31 December 2021)
o OEM (Automotive and Aviation) revenue of A$5.2m, representing a 69%
increase on the previous period (H1 2021: A$3.1m)
§ Includes a 170% increase in royalty revenue derived from the installation
of the Group's DMS technology of $2.1m (H1 2021: A$0.78m)
o Annual Recurring Revenue including royalties increased by 9.3% since 30
June 2021 to A$18.8m (FY2021: A$17.2m)
o Aftermarket (Fleet and Off-Road) revenue grew by 9% to A$16.4m (H1 2021:
A$15m)
o Aftermarket Monitoring Service Revenues including royalties grew by 16% to
A$6.7m (H1 2021: A$5.8m)
- Net loss reduced by 17.8% to A$13.8m (H1 2021: A$16.8m)
- Cash at 31 December 2021 of A$79.3m (31 December 2020: A$52.4m)
OEM (Automotive and Aviation) Highlights:
- Global momentum calling for Driver Monitoring System (DMS)
technology for enhanced safety continues and saw the USA introduce legislation
that would require DMS to reduce risks of distracted and drunk driving.
- Seeing Machines announced the largest driver and occupant monitoring
system technology award to date and was appointed by a new Tier 1 partner for
a leading German automaker, with an initial lifetime value of A$125m. This
brings total cumulative initial lifetime value of all Company won automotive
programs to more than A$325m.
- With over nine vehicle models now past start of production, there
are more than 250,000 cars on roads featuring Seeing Machines technology,
representing an increase of 108% since 30 June 2021. A further 30 distinct
vehicle models, featuring Seeing Machines technology, are expected to launch
by early 2023.
- Key commercial traction in Aviation, as Airservices Australia
announced that it will collaborate with Seeing Machines Aviation to enhance
safety in Air Traffic Management, and Air Ambulance Victoria announced its use
of Seeing Machines in the world-first pilot fatigue detection system.
- Seeing Machines and Collins Aerospace, the world's largest Tier 1
Avionics company, have signed a collaboration agreement to jointly market
co-developed solutions across the Aviation industry.
Aftermarket Highlights:
- Guardian, the Company's Aftermarket driver distraction and fatigue
technology, is now fitted to 36,933 individual vehicles, a 16.2% increase of
5,000 connections over the six month period (FY 2021: 31,771 units).
- The Company signed a Global Framework Agreement with Shell Global
Solutions International B.V. for the provision of Guardian, to enhance safety
across its worldwide operations.
- EROAD Limited, a leading transportation technology company that
offers fleet management software and products, has integrated Seeing Machines
Guardian technology into its fleet management software to help combat driver
fatigue and make roads safer.
- Seeing Machines established a European sales team, headquartered in
Amsterdam, the Netherlands, to lead the next phase of its business development
and focus on growing demand in Europe for the Company's Aftermarket driver
safety technology, Guardian.
Investment Highlights:
- On 23 November 2021, Seeing Machines issued 277,123,492 new ordinary
shares of no par value each (the "New Ordinary Shares") at a price of 11 pence
per New Ordinary Share, raising gross proceeds of approximately US$41,000,000
(the "Placing"). The net proceeds of the Placing are being used to accelerate
a range of features to meet technology demands and for general working capital
and corporate purposes, as well as to strengthen the Company's balance sheet.
Outlook:
- Seeing Machines continues to trade within the range of consensus
expectations for FY2022. 2
There is considerable accelerating momentum for the business, with current
market conditions presenting a significant opportunity to capture an even
greater market share as a number of structural tailwinds continue to support
application of the Company's technology. The current 'active RFQ' pipeline,
with program opportunities exceeding a cumulative total of A$1bn, underpins
the board's view that Seeing Machines will have an increased market share by
2025.
Paul McGlone, CEO of Seeing Machines commented: "These results demonstrate
positive momentum across the company. Our Automotive business continues to
grow with more cars starting production, generating high-margin royalty
revenue. This is underpinned by our increasing confidence in ongoing RFQ
processes as we focus on feature development and integration options to
support OEM demands, in partnership with our Tier 1 customers. Aftermarket is
experiencing similar positive momentum with growth in our direct business
resulting in a more profitable business model and a growing sales pipeline
through our expanding global team.
"There are obviously challenges with the current geopolitical and global
inflationary environment and supply chain that affect the market as a whole.
We are focused on mitigating these risks as they are identified and are
confident in our ability to continue to grow the business."
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
Nick Adams
Ross Poulley
+44 07791 892509
Lionsgate Communications (Media Enquiries)
Jonathan Charles
Seeing Machines (LSE: 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'
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.
Review of Operations
Financial Results
The Company's total sales revenue for H1 FY2022 (excluding foreign exchange
gains and finance income) increased
by 19.4% to A$21.7m (H1 FY2021: A$18.1m).
Business unit 31 Dec 2021 31 Dec 2020 Variance
$'000 $'000 %
OEM 5,243 3,103 69
Aftermarket 16,421 15,040 9
Sales Revenue 21,664 18,143 19
Royalty revenue, derived from installation of Seeing Machines' Driver
Monitoring System (DMS) technology, increased by 170% to A$2.1m compared to
the same period last year (H1 FY2021: A$0.78m) as vehicles start production
across a number of Automotive OEM programs. This demonstrates the significant
ramp up of royalty revenues, earned at a substantial margin, that is set to
continue as more of these programs are delivered.
Monitoring services revenue in Aftermarket grew by 16% to A$6.7m for the
half-year, compared to A$5.8m for the same period last year. Installed
Guardian units increased by over 5,000 to 36,933 connected units representing
a 16.2% growth in connections over the six-month period (FY21: 31,771 units),
demonstrating ongoing momentum for the Aftermarket
business, despite ongoing challenges posed by COVID-19 and supply chain
pressures.
The Company continued to invest in its core technology development to further
strengthen our competitive moat, rapidly expand features and leverage systems
approach across global OEM and Aftermarket industries. As a result, Seeing
Machines incurred total research and development expenses of A$18.1m during
the six-months ended 31 December 2021 (2020: A$8.9m), of which A$11.8m (2020:
nil) was capitalised.
Customer support and operations cost categories increased to A$4.3m (2020:
A$3.2m) and A$5.8m (2020: A$3.5m) respectively in line with strengthening of
business pursuit and emerging markets activities to support increased pipeline
and channel market expansion.
On 23 November 2021, Seeing Machines issued 277,123,492 new ordinary shares of
no par value each (the "New Ordinary Shares") at a price of 11 pence per
New Ordinary Share, raising gross proceeds of approximately US$41,000,000
(the "Placing"). The net proceeds of the Placing are being used to accelerate
a range of features to meet technology demands and for general working capital
and corporate purposes, as well as to strengthen the Company's balance sheet.
Cash and cash equivalents at 31
December totaled A$79.3m (2020: A$52.4m).
We highlight this report is unaudited. There is no requirement for the
interim financial statements to be subject to review by the external
auditor.
Interim Consolidated Statement of Financial Position - Unaudited
Consolidated
31 Dec 30 Jun
AS AT Notes 2021 2021
Unaudited Audited
A$000 A$000
ASSETS
CURRENT ASSETS
Cash and cash equivalents 5 79,261 47,393
Other short-term deposits 472 472
Trade and other receivables 6 17,633 19,851
Inventories 7 7,039 2,627
Other current assets 5,348 5,438
TOTAL CURRENT ASSETS 109,753 75,781
NON-CURRENT ASSETS
Property, plant & equipment 8 3,347 3,361
Intangible assets 9 21,477 9,540
Right-of-use assets 3,847 4,252
TOTAL NON-CURRENT ASSETS 28,671 17,153
TOTAL ASSETS 138,424 92,934
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 10 9,218 8,839
Lease liabilities 11 998 918
Provisions 5,579 4,893
Contract liabilities 1,733 772
TOTAL CURRENT LIABILITIES 17,528 15,422
NON-CURRENT LIABILITIES
Provisions 261 192
Lease liabilities 11 4,772 5,272
TOTAL NON-CURRENT LIABILITIES 5,033 5,464
TOTAL LIABILITIES 22,561 20,886
NET ASSETS 115,863 72,048
EQUITY 14 312,822 257,382
Contributed equity
Accumulated losses (215,821) (202,046)
Other reserves 18,862 16,712
Equity attributable to the owners of the parent 115,863 72,048
TOTAL EQUITY 115,863 72,048
The above interim consolidated statement of financial position should be read
in conjunction with the accompanying notes.
Interim Consolidated Statement of Comprehensive Income - Unaudited
Consolidated
2021 2020
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER Notes Unaudited Unaudited
A$000 A$000
Sale of goods and licence fees 11,480 9,159
Rendering of services 10,184 8,981
Research revenue - 3
Revenue 3 21,664 18,143
Cost of sales (11,528) (11,804)
Gross profit 10,136 6,339
Net gain/(loss) in foreign exchange 164 (2,002)
Finance income 219 196
Other (expense) / income (9) 1,672
Expenses
Research and development expenses 4 (6,286) (8,853)
Customer support and marketing expenses (4,327) (3,194)
Operations expenses (5,790) (3,476)
General and administration expenses (7,530) (7,186)
Finance costs (239) (267)
Loss before tax (13,662) (16,771)
Income tax expense (113) -
Loss after income tax (13,775) (16,771)
Loss for the period attributable to:
Equity holders of the parent (13,775) (16,771)
Other comprehensive income/(loss)
Exchange differences on translation of foreign operations 172 (22)
Other comprehensive income/(loss) net of tax 172 (22)
Total comprehensive loss (13,603) (16,793)
Total comprehensive loss attributable to:
Equity holders of the parent (13,603) (16,793)
Total comprehensive loss for the period (13,603) (16,793)
Loss per share for loss attributable to the ordinary equity holders of
the parent:
Basic loss per share 13 (0.01) (0.01)
Diluted loss per share 13 (0.01) (0.01)
The above interim consolidated statement of comprehensive income should be
read in conjunction with the accompanying notes.
Interim Consolidated Statement of Changes in Equity - Unaudited
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER Contributed Equity Accumulated Losses Foreign Currency Translation Reserve Employee Equity Benefits & Other Reserve Total Equity
A$000 A$000 A$000 A$000 A$000
As at 1 July 2020 217,204 (184.626) (1,516) 15,147 46,209
Loss for the period - (16,771) - - (16,771)
Other comprehensive loss - - (22) - (22)
Total comprehensive loss - (16.771) (22) - (16,793)
Transactions with owners in their capacity as owners:
Issue of new shares 27,526 - - - 27,526
Share-based payments - - - 1,943 1,943
At 31 December 2020 - Unaudited 244,730 (201,397) (1,538) 17,090 58,885
As at 1 July 2021 257,382 (202,046) (1,685) 18,397 72,048
Loss for the period - (13,775) - - (13,775)
Other comprehensive income - - 172 - 172
Total comprehensive loss - (13,775) 172 - (13,603)
Transactions with owners in their capacity as owners:
Issue of new shares 56,855 - - - 56,855
Capital raising costs (1,415) - - - (1,415)
Share-based payments - - - 1,978 1,978
At 31 December 2021 - Unaudited 312,822 (215,821) (1,513) 20,375 115,863
The above consolidated statement of changes in equity should be read in
conjunction with the accompanying notes.
Interim Consolidated Statement of Cash Flows - Unaudited
FOR THE SIX-MONTH PERIOD ENDED 2021 2020
31 DECEMBER Notes Unaudited Unaudited
A$000 A$000
Operating activities
Receipts from customers 25,919 18,519
Payments to suppliers (36,641) (32,556)
Receipt of government grants - 1,565
Interest received 219 45
Interest paid (239) (267)
Income tax paid (113) -
Net cash flows used in operating activities (10,855) (12,694)
Investing activities
Purchase of property, plant and equipment 8 (304) (92)
Payments for intangible assets (patents, licences and trademarks) 9 (181) (190)
Payments for intangible assets (capitalised development costs) 4, 9 (11,783) -
Maturity of term deposits - 180
Net cash flows (used in)/from investing activities (12,268) 102
Financing activities
Proceeds from issue of new shares 56,855 28,160
Cost of capital raising (1,415) (634)
Principal repayment of lease liabilities (421) -
Repayment of borrowings - (700)
Net cash flows from financing activities 55,019 26,826
Net increase in cash and cash equivalents 31,896 14,030
Net (decrease)/increase due to foreign exchange difference (28) 193
Cash and cash equivalents at 1 July 47,393 38,138
Cash and cash equivalents at 31 December 5 79,261 52,361
The above interim consolidated statement of cash flows should be read in
conjunction with the accompanying notes.
Notes to the Interim Consolidated Financial Statements - Unaudited
1 Corporate information
Seeing Machines Limited (the "Company") is a limited liability company
incorporated and domiciled in Australia and listed on the AIM market of the
London Stock Exchange. The address of the Company's registered office is 80
Mildura Street, Fyshwick, Australian Capital Territory, Australia.
Seeing Machines Limited and its subsidiaries (the "Group") provide operator
monitoring and intervention sensing technologies and services for the
automotive, mining, transport and aviation industries.
The interim consolidated financial report of the Group (the "interim financial
report") for the six-month period ended 31 December 2021 was authorised for
issue in accordance with a resolution of the Directors on 30 March 2022.
2 Basis of preparation and changes to the Group's accounting policies
(a) Basis of preparation
The interim financial report for the six-month period ended 31 December 2021
has been prepared in accordance with AASB 134 Interim Financial Reporting in
order to fulfil the reporting requirements of Rule 18 of the London Stock
Exchange's AIM Rules for Companies issued July 2016.
The interim financial report does not include all the information and
disclosures required in the annual financial report and should be read in
conjunction with the Group's annual consolidated financial statements as at 30
June 2021.
There is no requirement for the interim financial report to be subject to
audit or review by the external auditor and accordingly no audit or review has
been conducted.
(b) New standards, interpretations and amendments adopted by the Group
The accounting policies applied are consistent with those of the consolidated
financial statements for the year ended 31 June 2021, except for the adoption
of new amendments to the existing standards as set out below.
The Group has adopted all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to its operations and effective for an
accounting period that begins on or after 1 July 2021.
(i) Amendments to existing standards effective and adopted
with no significant impact to the Group
There has been no significant impact due to the adoption of any of the
following standards or amendments thereto.
AASB 2020-8 Amendments to Australian Accounting Standards - Interest Rate Benchmark Reform
- Phase 2
AASB 2021-3 Amendments to Australian Accounting Standards - Covid-19-Related Rent
Concessions beyond 30 June 2021
(ii) New and amended standards and interpretations that have
been issued but not yet effective or early adopted by the Group
At the date of authorisation of the interim financial report, the Group has
not applied the following new and revised Australian Accounting Standards,
Interpretations and amendments that have been issued but are not yet
effective.
Standard / Amendment Effective for annual reporting periods beginning on or after
AASB 17 and AASB 2020-5 Insurance Contracts and Amendments to Australian Accounting Standards - 1 January 2023
Insurance Contracts
AASB 2014-10; AASB 2015-10; and AASB 2017-5 Amendments to Australian Accounting Standards - Sale or Contribution of Assets 1 January 2022
between an Investor and its Associate or Joint Venture; Amendments to
Australian Accounting Standards - Effective Date of Amendments to AASB 10 and (Editorial corrections in AASB 2017-5 applied from 1 January 2018)
AASB 128; and Amendments to Australian Accounting Standards - Effective Date
of Amendments to AASB 10 and AASB 128 and Editorial Corrections
Notes to the Interim Consolidated Financial Statements - Unaudited
2 Basis of preparation and changes to the Group's accounting
policies (continued)
(b) New standards, interpretations and amendments adopted by the Group (continued)
(ii) New and amended standards and interpretations that have
been issued but not yet effective or early adopted by the Group (continued)
Standard / Amendment Effective for annual reporting periods beginning on or after
AASB 2020-1 and AASB 2020-6 Amendments to Australian Accounting Standards - Classification of Liabilities 1 January 2022
as Current or Non-Current and Amendments to Australian Accounting Standards -
Classification of Liabilities as Current or Non-current - Deferral of
Effective Date
AASB 2020-3 Amendments to Australian Accounting Standards - Annual Improvements 2018-2020 1 January 2022
and Other Amendments
AASB 2021-2 Amendments to Australian Accounting Standards - Disclosure of Accounting 1 January 2023
Policies and Definition of Accounting Estimates
In addition, at the date of authorisation of the interim financial report the
following IASB Standards and IFRS Interpretations Committee Interpretations
were on issue but not yet effective, but for which Australian equivalent
Standards and Interpretations have not yet been issued:
Standard / Amendment Effective for annual reporting periods beginning on or after
Deferred Tax related to Assets and Liabilities arising from a Single 1 January 2023
Transaction - Amendments to IAS 12
The Group is currently in the process of assessing the impact of the above
standards or amendments.
3 Segment information
a. Segment revenue based on operating segment
The following table presents revenue and net profit/(loss) information for the
Group's operating segments for the six-month periods ended 31 December 2021
and 2020, respectively:
Segment Revenue Segment Profit/(Loss)
FOR THE SIX-MONTH PERIOD ENDED 2021 2020 2021 2020
31 A$000 A$000 A$000
DECEMBER
A$000
Unaudited
OEM 5,243 3,103 (6,495) (7,515)
Aftermarket 16,421 15,040 844 (267)
Other - - (8,124) (8,989)
Total 21,664 18,143 (13,775) (16,771)
Notes to the Interim Consolidated Financial Statements - Unaudited
3 Segment information (continued)
b. Revenue from contracts with customers
In the following tables, revenue segments have been disaggregated by type of
goods or services which also reflects the timing of revenue recognition.
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2021 OEM A$000 Aftermarket A$000 Total A$000
Unaudited
Revenue Types
Sales at a point in time
Consulting - 839 839
Hardware and Installations 519 6,869 7,388
Royalties 2,099 - 2,099
Sales over time
Driver Monitoring - 6,726 6,726
Non-recurring Engineering 2,625 - 2,625
Licencing and royalties - 1,987 1,987
Total revenue 5,243 16,421 21,664
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 OEM A$000 Aftermarket A$000 Total A$000
Unaudited
Revenue Types
Sales at a point in time
Paid Research 3 - 3
Consulting - 544 544
Hardware and Installations 221 6,679 6,900
Royalties 778 - 778
Sales over time
Driver Monitoring - 5,811 5,811
Non-recurring Engineering 2,101 253 2,354
Licencing and royalties - 1,753 1,753
Total revenue 3,103 15,040 18,143
c. Geographic information
FOR THE SIX-MONTH PERIOD 2020
ENDED
2021 A$000
31
DECEMBER
A$000
Unaudited
Revenues from external customers 7,943 6,882
Australia
North America 10,038 5,420
Asia-Pacific (excluding Australia) 1,832 2,010
Europe 1,042 3,202
Other 809 629
Total revenue from external customers 21,664 18,143
The revenue information above is based on the locations of the customers.
Notes to the Interim Consolidated Financial Statements - Unaudited
4 Research and development expenses
Research and development expense relates to ongoing investment in the Group's
core technology.
The Group incurred total research and development expenses of A$18,069,000
during the six-months ended 31 December 2021 (2020: A$8,853,000), of which
A$11,783,000 (2020: nil) were capitalised.
As part of the assessment of research and development expenses at 30 June
2021, total costs of A$8,311,000 were capitalised for the year ended 30 June
2021, of which A$3,134,000 pertained to the six-month period ended 31 December
2020.
5 Cash and cash equivalents
For the purpose of the interim consolidated statement of cash flows, cash and
cash equivalents are comprised of the following:
31 Dec 30 June
2021 2021
Unaudited Audited
A$000 A$000
Cash at bank 29,307 47,393
Cash held for enhanced yield deposit (maturing on 10 January 2022) 49,954 -
Total cash and cash equivalents 79,261 47,393
On 10 December 2021 the Group entered into an enhanced yield deposit with HSBC
for principal amount of GBP 27,000,000. This is classified as short-term,
maturing on 10 January 2022 with an interest rate of 4.75%.
6 Trade and other receivables
Current 31 Dec 30 June
2021 2021
Unaudited Audited
A$000 A$000
Trade receivables (net of provisions) 16,673 19,427
Deferred finance income (237) (302)
16,436 19,125
Other receivables 1,197 726
Total trade and other receivables - current 17,633 19,851
The Group recognised nil impairment losses on receivables and contract assets
arising from contracts with customers for the six-month period ended 31
December 2021 (2020: A$27,000).
7 Inventories
31 Dec 30 Jun
2021 2021
Unaudited Audited
A$000 A$000
Finished goods (at lower of cost and net realisable value) 7,052 2,640
Provision for obsolescence (13) (13)
Total inventories at the lower of cost and net realisable value 7,039 2,627
Notes to the Interim Consolidated Financial Statements - Unaudited
8 Property, plant and equipment
Acquisitions and disposals
During the six-month period ended 31 December 2021, the Group acquired assets
with a cost of A$304,000 (2020: A$92,000).
No assets were disposed by the Group during the six-month
period ended 31 December 2021.
9 Intangible assets
During the six-month period ended 31 December 2021, the Group incurred
expenditure of A$11,964,000 (2020: A$190,000) related to intangibles.
A$181,000 (2020: A$190,000) of this expenditure related to patent and
trademark applications and licences. A$11,783,000 (2020: nil) related to
capitalised development costs.
A$1,000 (2020: nil) of intangibles relating to trademark applications were
disposed by the Group during the six-month period ended 31 December 2021.
10 Trade payables
At 31 December 2021, the balance of the trade payables was A$2,372,000 (30
June 2021: A$2,186,000), of which an amount of A$2,123,000 (30 June 2021:
A$2,043,000) was aged less than 60 days; and an amount of A$249,000 (30 June
2021: A$144,000) was aged over 60 days.
11 Lease liabilities
31 Dec 30 June
2021 2021
Unaudited Audited
A$000 A$000
Current
Lease liabilities 998 918
Non-current
Lease liabilities 4,772 5,272
Total lease liabilities 5,770 6,190
The table below summarises the maturity profile of the Group's liabilities
based on contractual undiscounted payments:
<=6 6-12 >1
AT 31 DEC 2021 months A$000 months A$000 year A$000 Total A$000 Carrying Value A$000
Lease liabilities 697 712 5,638 7,047 5,770
<=6 6-12 >1
AT 30 JUN 2021 months A$000 months A$000 year A$000 Total A$000 Carrying Value A$000
Lease liabilities 685 694 6,345 7,724 6,190
12 Dividends paid
No interim dividends or distributions have been made to members during the
six-month period ended 31 December 2021 (2020: nil) and no interim dividends
or distributions have been recommended or declared by the directors in respect
of the six-month period ended 31 December 2021 (2020: nil).
Notes to the Interim Consolidated Financial Statements - Unaudited
13 Earnings per share
The following table reflects the income and share
data used in the basic and diluted earnings per share computations:
Earnings used in calculating earnings per share
Consolidated
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2021 2020
A$000 A$000
For basic and diluted earnings per share:
Net loss (13,775) (16,771)
Net loss attributable to ordinary equity holders of the Company (13,775) (16,771)
Weighted average number of shares
AT 31 DECEMBER 2021 2020
Thousands Thousands
Weighted average number of ordinary shares for basic earnings per share 3,931,717 3,506,736
Weighted average number of ordinary shares adjusted for the effect of
dilution
3,931,717
3,506,736
14 Share capital
Consolidated
31 Dec 30 June
2021 2021
Unaudited Audited
A$000 A$000
Ordinary shares 312,822 257,382
Total contributed equity 312,822 257,382
Number of ordinary shares
Consolidated
31 Dec 30 June
2021 2021
Unaudited Audited
Thousands Thousands
Issued and fully paid 4,155,419 3,875,618
Fully paid shares carry one vote per share and carry the right to dividends.
The Company has no set authorised share capital and shares have no par value.
Movement in ordinary shares:
Shares
Thousands A$000
As at 1 July 2021 3,875,618 257,382
Shares issued 279,801 56,855
Transaction costs - (1,415)
As at 31 December 2021 4,155,419 312,822
Notes to the Interim Consolidated Financial Statements - Unaudited
15 Share-based payments
LTI 2021 - Performance rights or share options offers - Executive and key staff
From 1 July 2015, senior staff and other key staff are offered long term
incentive (LTI) performance rights or share options. Under this structure,
the staff are only able to exercise the rights, and have new ordinary
shares issued to them, if any performance, market and vesting conditions are
met. These conditions typically include a performance condition requiring the
staff member to achieve a minimum "meets expectations" rating and some rights
have included a market condition in the form of a minimum Target Share Price
(TSP). The vesting period ranges from 9 months to 5 years from the end of the
relevant financial year or grant date. Performance rights or options are
often offered as part of the annual remuneration review and may be offered at
other times. Any offer of performance rights or options
requires Board approval and, when granted, is announced to the market.
In November 2021 the Company awarded a total of 64,996,414 performance rights
in respect of ordinary shares to Executive and key staff to be issued at nil
cost.
14,845,702 of the performance rights under the LTI have been awarded in
recognition of the past achievement of the Company's objectives in FY2021. The
rights were valued at the spot rate of the shares at grant date, and the value
is amortised over the vesting period. The rights vest annually over 3 years in
equal tranches with the first vesting date being 1 July 2022 and require the
employee to remain continuously employed by the Company until each relevant
vesting date. If an employee leaves before the rights vest and the service
condition is therefore not met, the rights lapse.
In some cases, for 'good leavers', determined on a discretionary basis by
management, options are prorated for service in the current period and that
portion are vested on termination, and the remaining rights are cancelled.
The remaining 50,150,712 performance rights have been granted under Key Person
Agreements in respect of a total of 27 nominated key people. These people have
been identified as having key roles directly related to the Company's
long-term success and the allocation of accelerated performance rights has
been implemented by the Board to successfully retain these employees and
affirm successful delivery on a range of projects and customer commitments.
These awards have an accelerated grant with delayed vesting taking place on 1
July 2024 and require the employee to remain continuously employed by the
Company until the vesting date. If an employee leaves before the rights vest
and the service condition is therefore not met, the rights lapse.
There is no cash settlement of the rights.
16 Related party disclosures
The following table provides the total amount of transactions that have been
entered into with related parties during the six-month period
ended 31 December 2021 and 2020:
Balance Granted as Remuneration Acquired or sold for cash Balance 31-Dec
1-Jul
A$000 A$000 A$000 A$000
Director shares: 2021 5,714 - 238 5,952
Directors' securities
Directors' securities 2020 6,837 1,604 - 8,441
17 Commitments
As at 31 December 2021, the group had commitments of A$32,598,000 (31 December
2020: A$23,674,000) relating to the manufacturing contract for the
Group's Guardian 2.1 product for the period January 2022 to March
2023 (31 December 2020: January 2021 to January 2022).
Notes to the Interim Consolidated Financial Statements - Unaudited
18 Events after the reporting period
Other than the matters outlined below, there have been no matters that have
occurred subsequent to the reporting date, which have significantly affected,
or may significantly affect, the Group's operations, results or state of
affairs in future periods.
· As noted in cash and cash equivalents (refer Note 5), the
enhanced yield deposit matured on 10 January 2022. The strike rate of the
transaction was 0.5365 GBP/AUD, resulting in a principal amount of
A$50,326,000 and interest of A$203,000.
1 This refers to underlying growth rates at constant currency or adjusting
for currency so business results can be viewed without the impact of
fluctuations in foreign currency exchange rates, thereby facilitating
period-to-period comparisons of Seeing Machines business performance. To
present this information, current period results and comparative period
results are converted into Australian dollars at the 31 December 2021 exchange
rate.
2 Market expectations for FY2022 are for revenue of A$55.6m and EBITDA of
A$(32.7m)
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