Seeing Machines Limited ("Seeing
Machines" or the "Company")
18 March 2024
Half year results and
financial report
Double-digit underlying
revenue growth, continued operational and strategic progress, with
cars on the road exceeding 1.5 million
Production started on
groundbreaking US$82m interior cabin monitoring program for large
German auto manufacturer
Seeing Machines Limited (AIM: SEE,
"Seeing Machines" the
"Company" or the
"Group"), the advanced
computer vision technology company that designs AI-powered operator
monitoring systems to improve transport safety, today published its
unaudited results and financial report for the six months to 31
December 2023 ("H1 2024").
Financial Highlights:
- Underlying Revenue growth
for H1 2024 of 28% to US$25.6m excluding one-off Magna exclusivity
payments (Reported Revenue growth of 5% including these
one-offs)
o OEM (Automotive and
Aviation) revenue was US$11.4m (H1
2023: US$14m)
§ High
margin per vehicle royalty revenue, derived from Automotive
production volumes increased by 35% to US$4.2m (H1 2023:
US$3.1m)
o Annualised Recurring Revenues increased by 22% year on year
to US$14.5m (H1 2023: US$11.9m)
o Aftermarket (Fleet and
Off-Road) revenue increased by 38%
to US$14.3m (H1 2023: US$10.3m)
- Gross profit of US$10.6m,
reduced due to revenue mix changes compared to comparative period
with lower proportion of revenue from license fees, a higher
proportion of revenue from hardware sales and a lower margin on
services revenue.
- Net loss of US$19.8m
due to increased development expenditure compared to the
comparative period, mainly driven by increased amortisation of
previously capitalised expenditure. Several customer projects were
completed during the period, resulting in a short-term increase in
total development expense, including outsourced resources. The
overall development expenditure is expected to reduce in the second
half to 30 June 2024
- Net operating cashflows
improved to a net outflow of $1,109,000 (H1 FY2023: $6,832,000
outflow), thanks to disciplined focus on working capital
management
- Cash position at 31
December 2023 of US$22.2m with cash burn of US$13.9m for the half
year. Cash position supported by receivables and inventory balance
of US$31.1m with working capital unwind of $5-6m expected in H2
FY2024
Operational Highlights:
- Seeing Machines'
production debut of its highest volume program to date with an
initial lifetime value of US$82m, featuring interior cabin sensing
(driver and occupant monitoring system technology) via a single
camera system, a world-first, delivered for a large German OEM, has
launched to schedule
- Total of 1,516,545
cars on the road as of 31 December 2023, representing an increase
of 116% over 12 months period (H1 2023: 701,049) spanning six
individual programs with five global OEMs
- Appointed to deliver two
additional Automotive programs with a combined initial lifetime
value of US$45m, bringing the total won business to 17 programs
with 11 individual OEM customers, building the cumulative initial
lifetime value of all OEM programs to US$366m, with the majority of
that revenue expected by 2028
- Guardian Generation
3, the Company's innovative new Aftermarket Driver Monitoring
System (DMS) for the commercial transport and logistics sector, was
independently tested at IDIADA's state of the art test and
development facilities and assessed to meet requirements for
drowsiness detection in the European Commission's General Safety
Regulation (GSR), which is set to come into effect in July
2024
- Guardian is now
installed and monitoring 56,896 individual vehicles, compared to
46,018 in December 2023, representing an increase of 24% over the
12-month period
- Collins Aerospace,
the world's leading avionics tier 1 supplier, exclusively working
with Seeing Machines to target the aviation sector, has begun joint
development of the world's first aviation fatigue detection
solution, the first component of a potential multi-modal Pilot
Support System
Driver and Occupant Monitoring trends in Automotive and the
opportunities ahead
To date, the majority of Seeing
Machines' revenue generated by passenger vehicle production
royalties has been driven by optional Level 2/3 (partial driving
automation) 'hands off, eyes on' driving systems (leveraging Seeing
Machines' DMS on more than 30 car and truck models across Europe
and the US). These systems include General Motor's Super Cruise,
Ford's Blue Cruise, Daimler's Drive Pilot, BMW's Highway Assistant
and others that the Company is not yet permitted to
disclose.
The popularity and deployment of
these systems is growing, driven by OEM investment and the need to
enable vehicles with hands-free driving to extract premiums from
end customers of passenger and commercial vehicles.
Prior to regulation coming into
effect, initially in July 2024, DMS remains optional, and there has
been some moderation in short term demand for hands-free driving
systems due to the affordability of this (relatively expensive)
vehicle option in a challenging global financial environment. In
addition, there has been some testing of pricing models and levels
by OEMs. These factors have impacted the level of automotive
royalty volumes across Q2 FY2024 and the resulting total for H1
2024. Seeing Machines is confident of strong growth in royalties
tied to Level 2/3 driving systems across all regions.
The Company's confidence is
further underpinned by the safety and regulatory momentum that has
continued to build across the globe, supporting increased long-term
demand for the Company's differentiated DMS technology.
This is led in part by the
European New Car Assessment Program (Euro NCAP) requirements for
DMS, which started in 2023. A critical piece of EU legislation, the
GSR, will come into effect in July 2024 presenting significant
additional opportunities for the installation of Seeing Machines'
technology across existing and new automotive opportunities and for
commercial vehicles.
While OEMs have moved at different
speeds in pursuit of NCAP ratings, EU GSR mandates the use of
direct (camera-based) DMS or indirect (steering-wheel based)
warnings for drowsiness on all new cars, vans, trucks and buses
sold in the EU from July 2024. With over 17 million new vehicles
sold in Europe annually and Automotive awards for Seeing Machines
covering 6 OEMs selling into Europe, GSR is a highly visible
structural growth driver for FY2025 and beyond.
GSR mandates will be extended to
cover Driver Distraction in 2026, requiring camera-based DMS on all
new vehicles sold, bringing predictable, recurring revenue growth
for Seeing Machines. Mandates in the US market via the National
Highway Transport Safety Administration (NHTSA), dealing with
distraction and impairment (including alcohol) are also expected in
the next few years.
The rise in demand for interior
monitoring solutions that use a wide field of view camera system to
monitor the driver and full vehicle interior is driven by a
combination of Euro NCAP 2026 protocols requiring a broader view of
the cabin, as well as the motivation by OEMs to offer more in terms
of occupant focused comfort and convenience features at premium
prices.
Seeing Machines is leading the
industry in combining driver and occupant monitoring using a single
camera system (optionally integrated into a rear-view mirror with
partner, Magna) designed to address current Euro NCAP/GSR and the
emerging Euro NCAP 2026 requirements, positioning it for ongoing
success. This month, the Company became the first in the world to
launch such a system with a major European OEM as it starts
production on its largest Automotive award to date, supporting 2023
Euro NCAP, GSR and an array of interior cabin sensing features for
improved driver and occupant comfort and
convenience.
Outlook and current trading
The Group remains well-placed to
deliver continued progress in the year ahead, with a typical
weighting to the second half, and the Board retains its
expectations that financial performance for FY2024 will be in line with consensus[1].
Paul McGlone, CEO of Seeing Machines,
said: "We have continued to make good progress in
the first half, operationally and strategically, with double-digit
underlying sales growth and a greater contribution from our royalty
revenue stream, received for every car that is manufactured and
fitted with our technology.
Furthermore, we are delighted to see our first cabin sensing
program, using driver and occupant monitoring technology, start
production with a new OEM customer as scheduled and look forward to
volume ramping up over the course of the next few quarters as
production gets into full swing. With more than 1.5 million cars on
the road featuring our technology today, generating high-margin
royalty revenue, this milestone will play an important role in the
achievement of Seeing Machines' financial goals.
As transport safety regulatory deadlines mandating the
fitment of driver monitoring technology come into effect, we are
focused on working with our customers as they adjust to the
changes. We remain well placed to deliver on our attractive long
term growth prospects, thanks to our market leading scale, balance
sheet strength and proven technology supported by regulatory
changes."
Earnings call
The Company will host a
presentation via Investor Meet Company platform at 8am GMT Monday
18 March 2023. To register, please visit www.investormeetcompany.com.
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
Methuselah Tanyanyiwa
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
Overview
For the six-month period ended 31
December 2023, sales revenue increased by 6% compared to the
corresponding period. Cash balances decreased by $13,924,000 to
$22,215,000 (FY2023: $36,139,000) when compared to the preceding
financial year.
Financial
Results
The Company's total sales revenue for H1
FY2024 (excluding foreign exchange gains and finance income)
increased by 6% to $25,734,000 (H1 FY2023: $24,383,000).
|
Business unit
|
31 Dec
2023
|
31 Dec
2022
|
Variance
|
|
OEM
|
$'000
11,413
|
$'000
14,037
|
%
(19%)
|
|
Aftermarket
|
14,321
|
10,346
|
38%
|
|
Sales Revenue
|
25,734
|
24,383
|
6%
|
Royalty revenue, derived from installation of Seeing
Machines' Driver Monitoring System (DMS) technology, increased by
35% to $4,200,000 (H1 FY2023: $3,116,000) compared to the same
period last year. 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 addition to production
royalties, revenue of $2,249,000 (H1 FY2023: $5,354,000) from
license fees was earned from exclusive collaboration agreements.
The reduction in license fee revenue compared to the prior period
is a result of revenue for the provision of prior services that was
recognised in the comparative period at the commencement of the
agreement with Magna Electronics Inc.
Aftermarket hardware and installation revenue
increased by 202% to $5,954,000 (H1 FY2023: $1,971,000).
Connected Guardian units increased to 56,896 units in
December 2023 representing 24% annual growth from 46,018 in
December 2022. As a result of this growth monitoring services
revenue increased by 19% to $6,256,000 for half-year, compared to
$5,249,000 for the same period last year, continuing the
accumulation of recurring revenue from the Guardian
connections.
The Company continued to invest in its core
technology development to further strengthen its competitive moat,
rapidly expand features and leverage systems approach across global
OEM and Aftermarket industries. As a result, the Company incurred
total research and development expenses of $20,526,000 (H1 FY2023:
$17,236,000) during the six-month period ended 31 December 2023 of
which $12,350,000 (H1 FY2023: $11,146,000) was
capitalised.
Loss for the 6-month period ended 31 December
2023 increased to $19,802,000 (H1 FY2023: $4,619,000 loss) compared
to the same period last year. Gross profit reduced due to sales mix
changes compared to the comparative period with a lower proportion
of revenue from license fees and services.
Interim Consolidated Statement of Financial Position -
Unaudited
|
|
|
|
|
|
Consolidated
|
|
|
|
AS AT
|
Notes
|
|
31 Dec
2023
Unaudited
$000
|
30 Jun
2023
Audited
$000
|
31 Dec
2022
Unaudited
$000
(Restated)
|
|
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT ASSETS
Cash and cash
equivalents
|
5
|
|
22,215
|
36,139
|
52,186
|
|
|
Trade and other
receivables
|
6
|
|
18,249
|
27,039
|
14,843
|
|
|
Contract assets
|
|
|
5,702
|
6,513
|
4,656
|
|
|
Inventories
|
7
|
|
6,621
|
11,191
|
5,742
|
|
|
Other financial assets
|
|
|
226
|
312
|
321
|
|
|
Other current assets
|
|
|
2,255
|
1,116
|
4,100
|
|
|
TOTAL CURRENT ASSETS
|
|
|
55,268
|
82,310
|
81,848
|
|
|
NON-CURRENT ASSETS
Property, plant &
equipment
|
8
|
|
3,529
|
3,861
|
3,152
|
|
|
Right-of-use assets
|
|
|
4,259
|
1,853
|
2,114
|
|
|
Intangible assets
|
9
|
|
55,332
|
45,064
|
33,581
|
|
|
TOTAL NON-CURRENT ASSETS
|
|
|
63,120
|
50,778
|
38,847
|
|
|
TOTAL ASSETS
|
|
|
118,388
|
133,088
|
120,695
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
Trade and other
payables
|
10
|
|
10,282
|
11,646
|
7,692
|
|
|
Contract liabilities
|
|
|
3,973
|
4,634
|
5,734
|
|
|
Lease liabilities
|
11
|
|
804
|
708
|
686
|
|
|
Provisions
|
|
|
5,246
|
4,414
|
4,012
|
|
|
TOTAL CURRENT LIABILITIES
|
|
|
20,305
|
21,402
|
18,124
|
|
|
NON-CURRENT LIABILITIES
|
|
|
|
|
|
|
|
Borrowings
|
12
|
|
42,705
|
40,322
|
22,151
|
|
|
Lease liabilities
|
11
|
|
4,776
|
2,195
|
2,620
|
|
|
Deferred tax
liabilities
|
|
|
2,464
|
2,464
|
2,217
|
|
|
Provisions
|
|
|
322
|
174
|
212
|
|
|
TOTAL NON-CURRENT LIABILITIES
|
|
|
50,267
|
45,155
|
27,200
|
|
|
TOTAL LIABILITIES
|
|
|
70,572
|
66,557
|
45,324
|
|
|
NET ASSETS
|
|
|
47,816
|
66,531
|
75,371
|
|
|
EQUITY
Contributed equity
|
16
|
|
240,948
|
240,948
|
240,948
|
|
|
Other equity
|
13
|
|
5,749
|
5,749
|
5,172
|
|
|
Accumulated losses
|
|
|
(205,322)
|
(185,520)
|
(174,592)
|
|
|
Other capital reserves
|
|
|
6,441
|
5,354
|
3,843
|
|
|
Total equity attributable to the owners of Seeing
Machines
|
|
|
47,816
|
66,531
|
75,371
|
|
|
TOTAL EQUITY
|
|
|
47,816
|
66,531
|
75,371
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER
|
Notes
|
2023
Unaudited
$000
|
2022
Unaudited
$000
(Restated)
|
|
Sale of goods
|
|
5,858
|
2,322
|
|
|
Services revenue
|
|
11,723
|
12,193
|
|
|
Royalty and license
fees
|
|
8,153
|
9,868
|
|
|
Revenue
|
3
|
25,734
|
24,383
|
|
|
Cost of sales
|
|
(15,161)
|
(8,901)
|
|
|
Gross profit
|
|
10,573
|
15,482
|
|
|
|
|
|
|
|
|
Net foreign exchange
gains/(losses)
|
|
(67)
|
1,942
|
|
|
Other expenses
|
|
-
|
(81)
|
|
|
|
|
|
|
|
|
Research and development
expenses
|
|
(8,176)
|
(6,090)
|
|
|
Customer support and marketing
expenses
|
|
(4,306)
|
(3,325)
|
|
|
Operations expenses
|
|
(8,232)
|
(5,447)
|
|
|
General and administration
expenses
|
|
(7,180)
|
(6,470)
|
|
|
Expenses
|
4
|
(27,894)
|
(21,332)
|
|
|
|
|
|
|
|
|
Operating loss
|
|
(17,388)
|
(3,989)
|
|
|
|
|
|
|
|
|
Finance income
|
|
252
|
369
|
|
|
Finance costs
|
|
(2,648)
|
(876)
|
|
|
Finance costs - net
|
|
(2,396)
|
(507)
|
|
|
|
|
|
|
|
|
Loss before income tax
|
|
(19,784)
|
(4,496)
|
|
|
Income tax expense
|
|
(18)
|
(123)
|
|
|
Loss for the period
|
|
(19,802)
|
(4,619)
|
|
|
Loss for the period attributable to:
|
|
|
|
|
|
Equity holders of the
parent
|
|
(19,802)
|
(4,619)
|
|
|
|
|
|
|
|
|
Other comprehensive income/(loss)
Exchange differences on
translation of foreign operations
|
|
70
|
(2)
|
|
|
Other comprehensive income/(loss)
net of tax
|
|
70
|
(2)
|
|
|
Total comprehensive loss
|
|
(19,732)
|
(4,621)
|
|
|
Total comprehensive loss attributable to:
Equity holders of the
parent
|
|
(19,732)
|
(4,621)
|
|
|
Total comprehensive loss for the period
|
|
(19,732)
|
(4,621)
|
|
|
Loss per share for loss attributable to the ordinary equity
holders of
|
|
the parent:
|
|
|
|
|
|
|
Cents
|
Cents
|
|
Basic loss per share
|
15
|
(0.476)
|
(0.111)
|
|
Diluted loss per share
|
15
|
(0.476)
|
(0.111)
|
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
Notes to the Interim Consolidated Financial Statements -
Unaudited
4
Expenses
|
|
31 Dec
2023
Unaudited
|
31 Dec
2022
Unaudited
|
|
|
$000
|
$000
|
|
a. Research and
development expenses
|
|
|
|
Research and development
expenses
|
20,526
|
17,235
|
|
Capitalised development costs
during the period
|
(12,350)
|
(11,146)
|
|
Total research and development expenses
|
8,176
|
6,089
|
|
|
|
|
|
b. Depreciation
and amortisation expense
|
|
|
|
Depreciation expense - owned
assets
|
605
|
417
|
|
Depreciation expense - leased
assets
|
344
|
261
|
|
Amortisation expense - development
costs
|
2,160
|
1,246
|
|
Amortisation expense -
others
|
26
|
20
|
|
Total depreciation and amortisation expense
|
3,135
|
1,944
|
|
c. Employee
benefits expense
|
|
|
|
Wages and salaries and on-costs
(excluding superannuation)
|
24,680
|
20,057
|
|
Superannuation expense
|
2,030
|
1,516
|
|
Share-based payment
expense
|
1,017
|
1,004
|
|
Wages and salaries reported as
cost of sales
|
(7,877)
|
(5,831)
|
|
Wages and salaries capitalised to
development costs
|
(9,776)
|
(9,628)
|
|
Total employee benefits expense
|
10,074
|
7,118
|
|
d. Other
operating expenses
|
|
|
|
Non-recoverable foreign
withholding taxes
|
99
|
124
|
|
Total other operating expenses
|
99
|
124
|
|
|
|
|
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
2023
Unaudited
|
30 Jun
2023
Audited
|
|
|
$000
|
$000
|
|
Cash at bank
|
8,283
|
36,139
|
|
Term deposits maturing in less
than 3 months
|
13,932
|
-
|
|
Total cash and cash equivalents
|
22,215
|
36,139
|
Notes to the Interim Consolidated Financial Statements -
Unaudited
6 Trade and other
receivables
|
|
|
|
|
Current
|
31 Dec
2023
Unaudited
$000
|
30 Jun
2023
Audited
$000
|
|
Trade receivables (net of
provisions)
|
17,849
|
25,793
|
|
Deferred finance income
|
(14)
|
(101)
|
|
|
17,835
|
25,692
|
|
Other receivables
|
414
|
1,347
|
|
Total trade and other receivables - current
|
18,249
|
27,039
|
7 Inventories
|
|
31 Dec
2023
Unaudited
|
30 Jun
2023
Audited
|
|
|
$000
|
$000
|
|
Finished goods (at lower of cost
and net realisable value)
|
6,768
|
11,206
|
|
Provision for
obsolescence
|
(147)
|
(15)
|
|
Total inventories
|
6,621
|
11,191
|
8 Property, plant and
equipment
During the six-month period ended 31 December
2023, the Group acquired assets with a cost of $272,000 (H1 FY2023:
$524,000).
No assets relating to plant and equipment were
disposed by the Group during the six-month period ended 31 December
2023 (H1 FY2023: $17,000).
9 Intangible
assets
During the six-month period ended 31 December
2023, the Group incurred expenditure of $12,455,000 (H1 FY2023:
$11,237,000) related to intangibles. $105,000 (H1 FY2023: $91,000)
of this expenditure related to patent and trademark applications
and licenses. $12,350,000 (H1 FY2023: $11,146,000) related to
capitalised development costs.
No intangible assets were disposed by the
Group during the six-month period ended 31 December 2023 (H1
FY2023: nil).
10 Trade
payables
At 31 December 2023, the balance of the trade
payables was $4,244,000 (FY2023: $3,450,000), of which an amount of
$3,431,000 (FY2023: $3,383,000) was aged less than or equal to 60
days; and an amount of $813,000 (FY2023: $67,000) was aged over 60
days.
Notes to the Interim Consolidated Financial Statements -
Unaudited
11 Lease
liabilities
|
|
31 Dec
2023
Unaudited
|
30 Jun
2023
Audited
|
|
|
$000
|
$000
|
|
Current
|
|
|
|
Lease liabilities
|
804
|
708
|
|
|
|
|
|
Non-current
|
|
|
|
Lease liabilities
|
4,776
|
2,195
|
|
Total lease
liabilities
|
5,580
|
2,903
|
The table below summarises the maturity
profile of the Group's liabilities based on contractual
undiscounted payments:
|
AT
31 DEC 2023
|
<=6
months $000
|
6-12
months $000
|
>1
year $000
|
Total $000
|
Carrying Value
$000
|
|
Lease liabilities
|
464
|
708
|
5,773
|
6,945
|
5,580
|
|
AT
30 JUN 2023
|
<=6
months $000
|
6-12
months $000
|
>1
year $000
|
Total $000
|
Carrying Value
$000
|
|
Lease liabilities
|
445
|
452
|
2,451
|
3,348
|
2,903
|
12
Borrowings
|
|
31 Dec
2023
Unaudited
|
30 Jun
2023
Audited
|
|
Non-current
|
$000
|
$000
|
|
Convertible notes
|
42,705
|
40,322
|
The convertible notes are presented
in the balance sheet as follows:
|
Face value of notes
issued
|
47,500
|
47,500
|
|
Other equity securities - value of
conversion rights (see Note 13)
|
(8,213)
|
(8,213)
|
|
Transaction costs on
borrowings
|
(1,202)
|
(1,202)
|
|
Other costs on
borrowings
|
(187)
|
(74)
|
|
|
37,898
|
38,011
|
|
Interest expense
|
4,807
|
2,311
|
|
Non-current
liability
|
42,705
|
40,322
|
On 4 October 2022, Seeing Machines received
funding of $47,500,000 from Magna International ("Magna") in the
form of a non-transferable 4-year convertible note maturing in
October 2026 (the "Convertible Note"). The Convertible Note can be
drawn down in two tranches across the 4-year term. The Convertible
Note has an all-in yield of 8%, inclusive of fees. The Convertible
Note contains standard covenants, and anti-dilution provisions. The
interest due at the end of the facility can be paid in cash or
converted into equity at Seeing Machines' election.
The first tranche of $30,000,000, was drawn on
5 October 2022 and the second tranche of $17,500,000 was drawn down
on 27 June 2023. The liability portion of tranches 1 and 2 are
valued at amortised cost in accordance with AASB 9 Financial
Instruments ("AASB 9") and have effective interest rates of 13.03%
and 10.03% respectively.
Magna may elect to convert the principal and
at Seeing Machines' election, interest outstanding under the
Convertible Note at any time during its term, up to a maximum of
349,650,350 shares which, when added to Magna's existing
shareholding in the Company, will represent approximately 9.9% of
the fully diluted share capital of the Company. The conversion will
be at a price of 11 British pence per share. The option provided to
Magna is deemed to be an embedded derivative and is classified as
other equity (see Note 13).
Notes to the Interim Consolidated Financial Statements -
Unaudited
13 Other
equity
|
|
31 Dec
2023
Unaudited
|
30 Jun
2023
Audited
|
|
|
$000
|
$000
|
|
Value of conversion rights -
convertible notes
|
8,213
|
8,213
|
|
Deferred tax liability
component
|
(2,464)
|
(2,464)
|
|
Total other equity
|
5,749
|
5,749
|
(i)
Conversion right of convertible notes
The amount shown for other equity
securities is the value of the conversion rights relating to the
convertible note, details of which are shown in Note 12.
14
Dividends paid
No interim dividends or distributions have
been made to members during the six-month period ended 31 December
2023 (H1 FY2023: 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 2023 (H1 FY2023:
nil).
15 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
|
2023
$000
|
2022
$000
(Restated)
|
|
For basic and diluted earnings per share:
Net loss
|
(19,802)
|
(4,619)
|
|
Net loss attributable to ordinary equity holders of the
Company
|
(19,802)
|
(4,619)
|
|
Weighted average number of shares
|
|
|
|
AT
31 DECEMBER
|
2023
Thousands
|
2022
Thousands
|
|
Weighted average number of
ordinary shares for basic earnings per share
|
4,156,019
|
4,156,019
|
|
Weighted average number of
ordinary shares adjusted for the effect of dilution
|
|
|
4,156,019
4,156,019
16
Contributed equity
|
|
|
Consolidated
|
|
|
|
31 Dec
2023
Unaudited
$000
|
30 Jun
2023
Audited
$000
|
|
Ordinary shares
|
|
240,948
|
240,948
|
|
Total contributed equity
|
|
240,948
|
240,948
|
|
Consolidated
|
|
|
31 Dec
2023
Unaudited
|
30 Jun
2023
Audited
|
|
Number of ordinary shares
|
Thousands
|
Thousands
|
|
Issued and fully paid
|
4,156,019
|
4,156,019
|
|
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.
|
Notes to the Interim Consolidated Financial Statements -
Unaudited
17
Share-based payments
Long Term Incentive - 2020 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 March 2023 the Company awarded a total of
12,420,232 performance rights in respect of ordinary shares to
Executive and key staff to be issued at nil cost.
8,004,838 of the performance rights under the
LTI have been awarded in recognition of the past achievement of the
Company's objectives in FY2022. 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.
The remaining 4,415,394 performance rights
have been granted under a Key Person Agreement in respect of one
nominated person. This person has been identified as having a key
role 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 this employee 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 the 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 is vested on termination,
the remaining rights are cancelled.
There is no cash
settlement of the rights. The Group accounts for the Executive
Share Plan as an equity-settled plan.
18 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 2023 and
2022:
|
|
|
|
|
|
|
|
|
|
Balance
1-Jul
|
Acquired
or sold
for cash
|
Other changes during the
period
|
Balance
31-Dec
|
|
|
|
Thousands
|
Thousands
|
Thousands
|
Thousands
|
|
Director shares:
Directors' securities
|
2023
|
8,002
|
850
|
7,500
|
16,352
|
|
Directors' securities
|
2022
|
6,552
|
-
|
-
|
6,552
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19
Commitments
As at 31 December 2023, the group had
commitments of $5,881,000 (H1 FY2023: $15,289,000) relating to the
manufacturing contract for the Group's Guardian 2.1 product for the
period January 2024 to June 2024.
20 Events
after the reporting period
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.