REG - Seeing Machines Ltd - Half year trading update

Seeing MachinesAnnouncement

23/02/2022 07:00

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RNS Number : 5406C  Seeing Machines Limited  23 February 2022

 

Seeing Machines Limited

 

23 February 2022

Half year trading update

 

Strong growth in both revenue and ARR drive confidence in meeting full year
expectations

 

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, publishes a trading update for
the six months to 31 December 2021 ("H1 2021").

 

The Company expects to report revenue for H1 2022 of A$21.7m (H1 2021:
A$18.1m), representing a 19.4% increase year-on-year and an underlying growth
rate 1  (#_ftn1) of 24.6%. Total connected Guardian units at 31 December 2021
was 36,933, securing forward Annualised Recurring Revenues including royalties
of A$18.8m (H1 2021: A$15.5m). Cash position at 31 December 2021 of A$79.7m
(H1 2021: A$52.7m).

 

The Driver Monitoring System (DMS) technology market has matured over the past
two years accelerating the market opportunity for Seeing Machines
significantly across all transport sectors. With that, the global landscape is
changing as the Automotive industry starts production on a range of vehicles,
featuring semi-automated features, underpinned by DMS as an enabling and
safety technology, working closely with advanced driver assistance systems.
Aftermarket opportunities have begun to resonate with large multi-national
companies concerned with enhanced safety and the Aviation industry has started
to commercialise engagement with the Company as the benefits of eye-tracking
are acknowledged and implemented.

 

Government and industry bodies globally are demanding a focus on safety and
that is being accompanied by regulation that will see DMS widely mandated,
already set for Europe and now backed up by the USA, signaling more global
activity.

 

To support this momentum and maintain its leadership position, Seeing Machines
has renewed focus on its technology roadmap and, following the successful
fundraise in November 2021, will accelerate the development of new core
software and systems features, expand sales channels and overall product
portfolio to maximise its win rate of automotive programs in a significant
sales pipeline and speed up growth in aftermarket revenue.

 

OEM (Automotive and Aviation) Highlights:

 

-     In the USA, bipartisan infrastructure legislation includes pieces of
the SAFE Act which would require DMS technology to detect distracted driving.
In addition, the RIDE Act is included and calls for new cars to use advanced
drunk driving technology to stop impaired driving.

 

-     Seeing Machines was appointed by a global Automotive Tier-1 supplier
to deliver the largest driver and occupant monitoring system technology award
to date for a leading German automaker. Covering an expansive number of
vehicle models, with mass production scheduled from early 2024, the program
has an initial lifetime value of A$125 million.

 

-     Currently engaged on eleven automotive programs for eight individual
OEMs, spanning an estimated 95 vehicle models, the cumulative initial lifetime
value of all Seeing Machines won automotive programs stands at more than
A$325m.

 

-     As cars fitted with Seeing Machines DMS start production, the
automotive revenue mix is changing from NRE (non-recurring engineering) to
more recurring, higher margin licence royalties. With over nine vehicle models
now past start of production, there are more than 250,000 cars on roads
featuring the Company's technology, representing an increase of 108% since 30
June 2021. The Company expects a further 30 distinct vehicle models, featuring
Seeing Machines technology, to launch by early 2023.

 

-     Airservices Australia announced that it will collaborate with Seeing
Machines Aviation to enhance safety in Air Traffic Management. With an initial
program of work, valued at around A$250k, the two organisations will work
together to develop and integrate Seeing Machines' technology to support and
optimise safe and effective controller performance in an increasingly
automated Air Traffic Control environment.

 

-     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:

 

-     The Company signed a Global Framework Agreement with Shell Global
Solutions International B.V. for the provision of its Aftermarket driver
distraction and fatigue technology, 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.

 

 

Paul McGlone, CEO of Seeing Machines commented: "The activity across our
entire business, coupled with a remarkable increase in cars on the roads
fitted with our DMS technology and generating automotive royalty revenues,
together with the positive financial results for the first half of 2022,
signal excellent momentum and a changing landscape for the business. Our
technology is well and truly established as industry leading and we are seeing
that acknowledgement across all transport sectors as we continue to work with
a growing number of the world's most prestigious brands.

 

"Our focus, as always, is on delivery and technology leadership. The team
continues to evolve to achieve this and to meet the growing demand for driver
and operator monitoring system technology.  We are extremely confident of
more progress in the second half of the financial year and I'm looking forward
to more expansion, into more geographical markets, to maximise our growth
aspirations and return value to our shareholders as we deliver against market
expectations 2  (#_ftn2) ."

 

 

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

 Lionsgate Communications (Media Enquiries)                     +44 07791 892509

 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.

 

(http://www.seeingmachines.com)

 

 1  (#_ftnref1) 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  (#_ftnref2) Market expectations for FY2022 are for revenue of A$55.6m and
EBITDA of A$(32.7m)

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