Earnings Call: H1 2021

Mar 31, 2021

Quarterly report

Hand corner of your screen. Simply type in your question and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today hand and published responses where it's appropriate to do so. I'd also like to remind you this presentation is being recorded. Before we begin, we'd like to submit the following poll. Hand. I'd now like to hand you over to Paul McGowan, CEO Naomi Rule, CFO and Kate Hill, Non Executive Chair of Sea and Sheens. Good morning, Kate. Hand. Good morning to all of our investors who are joining us in the U. K. Good evening to those joining us in Australia. And if you're joining hand. Yes, for anywhere else like North America, it's some hideous time of the night. And thank you very much if you've joined from North America. Hand. But to everybody, welcome to this presentation of our first half results for same change. It has been it continues to be a challenging business environment, hand. As I'm sure you're all aware, but against this backdrop and despite, in fact, the backdrop, we're very pleased with our results for the first half. Hand. And in fact, we're extremely pleased for the momentum that we're seeing in our business across all of our target sectors. Hand. As you'd be aware, DMS has become central to safety outcomes across a range of industries. Hand. But what we're also seeing is a broadening community of stakeholders who are interested in this technology. And that includes, of course, more investors, hand. It includes media, includes government and of course regulators. So it's interesting to reflect on the history of seeing machines. Our founders hand. Some 20 years ago had the foresight to think about investing in this area and in this technology. And it's that foresight that was shown all those years ago that's hand. It led us to the position we're in today when really we're just seeing opportunities arising from all sorts of areas. It's a very exciting period to be involved in the company. Hand. But we have to keep our feet on the ground and we are keeping our feet on the ground by being focused on delivery. We've been doing this hand. For some time now and we continue to focus on delivery. It's terribly important. And by that, I mean we're delivering to our customers, hand. We're delivering to our people and our team and, of course, to our investors. So before I finish my opening remarks, hand. I would like to give congratulations to Paul and to the whole team who have been focusing on delivery, hand. Keeping our feet on the ground and really the position we're in now is down to an awful lot of hard work by all of those guys. So thank you. Hand. We're now going to play a short video, which really speaks to the purpose of Seeing Machines. So if you could play the video, please, Paul. Hand. So welcome to everybody. We have you've heard from Kate hand. In the opening remarks, we have Naomi here with us as well. We thought it was very important to share that purpose video with you. It's something that we've been working on hand. Here for some time now. I have to say it's central to what motivates our people to work as hard as they do hand across multiple time zones in order to achieve extraordinary results, frankly, in very, very testing hand. So I hope you enjoyed that short presentation. Hand. I'll just walk us through some of the highlights before I hand off to Naomi who will take us through the numbers in a little bit more detail. Hand. As Kate mentioned, we're quite pleased with revenue in the first half, a backdrop of difficult global trading conditions. I think everybody's hand. Well, I'm truly aware of that. I mean, we've mentioned before that we did get a recovery in the Southern Hemisphere, which is hand. Compensated for what is still a very sluggish set of operating conditions in the Northern Hemisphere, particularly in our fleet business. Hand. Automotive, not impacted in the same way. And of course, the revenues from auto, a little longer tail. Hand. The recurring revenue, which is very important to us, has also grown more than 17% in the same period last year. Our cash position is very strong. Hand. And a big contributor to that was the placement that we did last year to Federated. Hand. We're very pleased to have a very significant U. S. Investor, want to invest in our company alongside all of you. Hand. And just a few weeks ago, we made an investment for hand. US10 million dollars or almost AUD13 million to another specialist U. S. Fund manager called Toronado. Hand. Now the position today is that we have a very strong balance sheet, a balance sheet that can see us deliver our previously announced business plan hand. And also afford us the opportunity to pursue incremental growth as it's presented over the course of the next hand. Several quarters and few years. So we're quite pleased with that headline result. Hand. Hand. So in terms of our operational highlights here, hand. So the screen is microscopic and I wear glasses for a different reason. Hand. So just on the operational highlights, much of this you've heard before and this presentation is really somewhat of a repeat of what we did at our insurance, but hand. We are really pleased with where our OEM business is going. The revenue set to expand there. Hand. And what we're seeing now as our customers' vehicles hit start of production is we're seeing underlying growth in the license revenues hand. And in time, that growth rate and those revenues will overtake, what has been our historical, OEM revenue of NRE. Hand. What that means, we're going to see significant margin expansion over time because as I think everyone knows and I've mentioned before, hand. Margins for licenses are in the 90 plus range versus NRE, which is single digit margin and Pretty hard work. So that's a very important pivot point for us in the shape of earnings, in the shape of revenue that we produce. Hand. Over 26,000 connected units driving that annual recurring revenue of 15 plus 1,000,000 for the half that I discussed. Hand. The automotive business has been working very, very hard delivering new proof of concepts hand. To Tier 1s and OEMs, we've successfully developed what is proving to be a highly sought after hand. A piece of technology that expands our driver monitoring capability at the same level of fidelity as we provide hand for the driver across the passenger. Now this breakthrough that we've developed is in high demand and we see hand. But this is one of several milestones that we think will increase the rate of penetration of DMS hand and combined DMS, OMS. So we're pretty pleased with that. Our fleet business continues hand. To rack up the kilometers and as you know, those kilometers contribute to our truthing, enabling us to continue to develop algorithms that hand. Perform at the highest levels and this is very, very important part of our business going forward. And it's hand. The reason why we remain focused on operating in OEM and aftermarket together, hand. It's a very important ingredient in the overall mix. Last year during COVID, as hand. Most other businesses did. We reduced our costs both discretionary and permanent. We're very pleased to say that hand. Those costs reduction areas have stuck and have flown through to the P and L. You can see that in the numbers that and Naomi will highlight that to you in a moment. Hand. That was a very difficult period. And you do what you have to do as the circumstances present themselves. Hand. Of course, now as our business is beginning to grow and we're seeing more and more RFQs come through and more and more demand hand. For our technology, we have a different challenge and that challenge is to double down on capacity, rebuild hand. Some specialization in our business that we think will be very necessary, not just to win in this hand. Competitive environment, but to deliver against what are quite frankly, quite onerous requirements from our customers. So hand. The mood has changed, the times have changed and we're very, very much focused on winning and delivery. I'll talk about the U. S. Just very quickly. Hand. As I've mentioned several times over the last year at least, we've been very focused on trying to attract hand. Interests from new U. S. Investors. We've successfully done that through 2 raises. I think those two raises combined have continued hand. To support our price to the levels where they are today, which is 3 times where they were hand. Not so long ago. But not only that, we've also had new U. S. Investors by your company on market. Hand. And that's really the main game to get on market support from investors that understand technology and in particular, our technology in the industries that we hand. So we feel that that work is paying off. And of course, we're also in an environment where hand. The recognition of the role of DMS and the market in general's perception of this technology has changed. Hand. And I think that's a permanent change and it will support the growth in shareholder value as we continue to deliver over coming months years. Hand. In Aviation, this is one of the areas of our business that is always on the agenda. Hand. And yes, it's taken longer and it continues to be a long tail opportunity, hand. But we are making progress. I want to make that point. I'm not going to be drawn into any questions on how imminent. There were hand. 1 or 2 funny ones around that. But what I can say is we are making very real and very solid progress hand. Both in RFQs, in project work, in development work, getting our tech into simulators hand and control environments. So it's a low investment, long term development with very, very high returns. So we're going to stick with that hand. And there'll be more to report shortly. I'll hand over now to Naomi, hand. And she can take you through more financial highlights. Thanks, Paul. So to dive straight into it, our top line revenue for the group has improved hand. 15% to $18,100,000 on the previous period. This is a great result, especially under the business conditions that we're all facing globally. Hand. If we look to the results using constant currency, which isn't on this slide, and by that I mean applying the same exchange rates in both sets of results hand. To compare year on year growth, we have an even better outcome. And our first half will show an underlying revenue improvement of 19%, which we are very pleased with. Hand. Aftermarket grew 17 percent to $15,000,000 and now boasts annual recurring revenues of $15,500,000 representing a growth rate of hand. Now this is an important metric for obvious reasons because annual recurring revenues indicates hand. The annual committed revenue from existing customers, meaning we've locked in a minimum of $15,500,000 in revenue hand for the next year before the year has started. Connected unit growth of over 3,000 units during the half is a major contributing factor to the growth hand. In addition to an increase in our hardware sales, some may say it's incredible that all geographies grew to some extent and it is, hand given extreme conditions in the Northern Hemisphere right now and over the past 12 months. However, the majority of our growth occurred across Australia, New Zealand hand. And the Asia Pacific region as the impact of COVID has been significantly less in the Southern Hemisphere as we know. Hand. And it's made it easier to access trucks for installation, but also importantly to progress the sales cycle with less business interruptions. Hand. OEM, which covers our automotive and aviation businesses, grew 5% to $3,100,000 during the half. Hand. Non recurring engineering was slightly up on prior years as OEMs inched ever so closer towards production and program milestones are met. Hand. However, it's actually quite exciting that this half saw the start of production for 3 OEMs, which generated production royalties. Hand. And we saw over 31,500 vehicles come off the production line with our technology embedded in them. Hand. This actually marks the beginning of the transformation for our automotive revenue and we'll see a transition from non recurring engineering hand. High margin, high volume royalty revenue as OEM started production vehicles hit the road. This will increase significantly over the next 2 years where we expect to see 30 distinct car models hit dealerships with same machines DMS over the next 2 years. Hand. Our group gross margins are in line with the prior year and is anticipated to improve as we continue to realize our lower hardware cost within the aftermarket segment and increased OEM royalties, which attract very high margins. With a significant focus on cost management over the past hand. 12 months, I'm very pleased to confirm that our operating expenses have reduced across all areas. Now some of these measures have been temporary to deal with the COVID-nineteen situation, action, but we also have a range of permanent savings that will further improve the net position of the company. Hand. Now the normalized numbers to the right of the slide add back the $3,500,000 cost savings hand. For half one twenty twenty one and also increased H1 twenty twenty costs in line with the change in recognition of short and long term incentives. Hand. This normalized perspective highlights the improved performance on a like for like basis between periods. Hand. And as I said previously, it's a result of enhanced cost management and focus on delivering outcomes for all of our stakeholders. Hand. Our statement of financial position does remain heavily influenced by hand. Cash and working capital movements largely because we are expensing rather than capitalizing development costs associated with the development of our core technology. Hand. Importantly, we do not hold any debt. The liabilities are reflective of the requirement under the hand. Leasing accounting standard that recognizes both leases as an asset and a liability on our balance sheet. Hand. Our inventory is at a healthy level and structured and managed to meet our near term sales pipeline and commitments. Hand. And whilst our overall inventory in number has increased in line with sales, the actual cost hand. And value has decreased due to the previously announced reduction in hardware costs of around 21%. Hand. Our working capital balances are very healthy and will enable us to move forward to profitably. Hand. Customer receipts are lower for this period compared to the prior year hand. And that's primarily due to timing between invoicing and cash receipts. Now this is in line with the financial year 2019 4th hand. Quarter invoicing for OEM program milestones, about $1,500,000 $2,000,000 for our aftermarket sales. Hand. The timing delta that you see here between revenue recognition and receiving cash will be a continuing trend over the coming years hand as our revenue from OEM royalties become a higher contributor to our top line growth. The monthly cash burn without grants hand. Is approximately $2,300,000 which is trending 8% lower than the prior year and improving in line with top line revenue growth hand. And continue cost management strategies on a monthly basis. And as Paul pointed to hand. Just earlier, in October, we received $28,000,000 in cash with the issue of hand. 372,000,000 shares to Federated Hermes. And this month, in fact, we welcomed an additional investor, Toronado Fund, hand. With 68,000,000 shares, further improving our cash position by an extra $13,000,000 hand. Thank you. Hand. I'll take you now through some highlights in each of the areas of our business. And again, look, some of these I've mentioned before, hand. And hopefully, I can provide some additional color. So 30 distinct car models will hit production hand. In the next 2 years, so after a couple that we've announced, as Naomi said, we've got more than 31,000 vehicles have been produced with our technology in them, that rate is set to increase hand. In a linear fashion between now and 2025, it's a very important number to us obviously, hand. Both in terms of top line growth, but in terms of margin contribution and cash. The large proportion of that license revenue flows to cash. So hand. That's very, very important. I'll just add that when we talk about model here, and I know there's all kinds of different definitions hand in the marketplace. But we talk about a model class. So we're not talking about model trim levels or anything like that. It's just hand. The model class, the highest level of definition for the model. We as we hand. Sign up with an OEM to do work. The specific allocation of the technology across the fleet hand. It's typically not known to us until much later in the piece. So, we quote on a gross volume. Gross delivered volumes are often hand. Higher than what we quote, but what lies underneath in terms of all of the different model variance is often not known until later. Hand. And we're seeing that today as we ever so slowly announced these vehicles hitting production. Hand. Of course, I think as everybody knows, one of our great frustrations is that we can't announce them immediately. And that's hand essentially because of the type of commercial contracts that we have that prevent that from happening. But hand. In due course, all of these 30 models will be announced and the market will be able to determine the volumes on those models hand. In actual production rather than our quoted bid. And I think the end result of that will be largely positive. Hand. So we've got a picture of the Escalade there, a well known car in the U. S. Hand. And we're able to talk about it. So that's fantastic. It's getting quite a bit of publicity, which is good. On the partnership side, hand. This is really important to us. We announced our 3 pillar strategy some time ago. And hand. As you know, at the end of the day, we're delivering software. The only question is how is that software delivered? Hand. Do we deliver bespoke integrated on a silicon platform or do we enable others to access intellectual hand. Property in an accelerated fashion that they can deliver in parallel with us. So we cover all of those conditions. Hand. The relationships that we have, starting with Xilinx, very, very important. The early work and the early investment in developing that chip strategy hand. Has really paved the way for what we've been able to do with Omnivision and Qualcomm. Both of those arrangements are quite different, hand. But they are very, very real. Both companies are investing very heavily to get our technology integrated hand. We're embedded in the silicone and in their systems. And if you look at the scale of each of them, without hand. Trying to list all of the different OEMs that they work with, it's pretty evident hand. But those relationships will facilitate a better sales outcome for us. And that's what this is all about. Hand. Occupant monitoring, I've mentioned, that's launched and we will see hand. Some traction in this aviation business. The work continues, the interest continues. And I think as hand. The world returns to normality. We'll see an increase in the rate of exposure to aviation customers. Hand. In aftermarket, we've appointed a new GM to take over the business. Mike Lanay hand. He's taking on a new role as Chief Scientist Safety and Human Factors. He's playing a much more hand. Focused role on the external regulatory environment. He's deeply involved in the work that we're doing with directly with Euro NCAP regulators in the U. S. Hand and forming new relationships to influence the regulatory framework in Japan as well. Hand. He's also working on a whole range of programs for us on the data side. Hand. And of course, they are very, very important because it's data that underpins the velocity in our hand. Technical roadmap or a feature development. So he's doubling down in that area. Max Levine has joined us, hand. Very strong background in telematics, so he's hit the ground running and he's really getting into the detail and I'm very pleased hand with where we are so far. I'll talk a little about channels. The rest of those documents we've already covered. Hand. So Northern Hemisphere, we have 15 channel partners or distributors. And I've mentioned already that the Northern Hemisphere remains a pretty difficult environment. Hand. And all of you would know better than I, given that you're living it day by day. Hand. But we are seeing some green shoots. We are seeing interest return in both the UK, Europe and the U. S. Our business hand. Our distributors in Latin America are continuing to grow, but really the powerhouse in this hand. Last period has been the Southern Hemisphere, primarily Australia, New Zealand and Southeast Asia. And we're very fortunate hand. That's been the case. And I guess here in particular, in New Zealand, in particular, small economies on the global scale, but hand. Given we're in Ireland, we've had very clearly the fastest recovery from COVID. Hand. And it's fair to say that we're back in full swing down here, which is I think very good for us, but also very good for our shareholders. Hand. On insurance, again, we've spoken about insurance and the importance of insurance. This is an area of interest that's increasing. Hand. We've mentioned NTI in the past. We are now running a formal program with NTI to support a more rapid uptake of our technology hand for their customers. That means new customers for us. So we're running hand. Several waves of new campaigns to drive our technology into the market. The regulators hand here. And for that matter, in most of the markets that we operate in, are upping the ante hand. On the specific risk areas that our technology mitigates and that's fatigue and distraction. Hand. So we've mentioned before that those two risks are the single highest contributors to fleet insurance claims costs globally hand. And our technology reduces the incident of those risks by up to 90%. So insurers and regulators are hand. Building their confidence in the technology and they're being more assertive in encouraging customers to adopt hand. And that I think bodes well for us going forward. Hand. So just to wrap up the formal piece here. Hand. The DMS market, and I'll focus specifically on automotive here. We had a period during hand. COVID that was we didn't really know which way it was going to go. From November last year, we've seen a dramatic uptick hand. In both the number of RFQs and the quantum of those RFQs. So this is a very major turning point. Hand. As I said earlier, we're increasing our capacity to make sure that we can win our fair share. Hand. The market holistically has accepted that DMS is a permanent feature hand. The automotive landscape. And I think, look, this is strong for all participants in this sector. And there aren't many, as I think most of our shareholders hand. Each day, we compete on our own strengths. And we here are very, hand. Very pleased and very confident with the strategy that we're deploying. And as the market is now building up ahead of steam, which hand. I would call a race to end cap 2024. I believe we're going to see hand. A raft of additional RFQs over the next 6 to 9 months. Now we're seeing these RFQs across multiple jurisdictions by the way. So we're seeing them in Europe, the U. S. Hand and Asia, Japan in particular. So that gives us even more confidence that this is a permanent fixture and that we were positioned hand to win our 1st year. On the chip side of things, look, we're delighted with the relationships, hand. The long term relationship with Xilinx, the new relationships with Qualcomm and Omnivision. We have frankly a very strong hand. Dan's card of other semiconductor companies that are wanting to work with us, wanting to figure out how to deploy our intellectual property, hand. Seeing how they can get ahead of the market in terms of the combination of hand. Software hardware pricing, which is mission critical as OEMs are looking to mass market adoption. Hand. So these conversations we think are very, very positive. They all go well for our mid and long term strategy and they make for different conversations, hand. Differentiating conversations with our customers. So we're really pleased with where that's going. Hand. I think you can see through the results, we are focused on performance, profitable growth. We no longer do a negative margin contract. We no longer have negative margin hardware sales. Hand. We are very pleased with the fleet's fleet businesses trajectory hand. And it is very close to profitability in its own right. Hand. So to sum it up, pretty pleased with the outcome. Hand. I'm going to turn to another video which some of you perhaps not all of you have seen, but I'll just ask to run that now, Paul, if we could. Hand. Seeing Machines and Qualcomm are working together to develop next generation technology hand. It enables human centric intelligent vehicle interiors. These are powered by Qualcomm's Snapdragon family to meet challenging future requirements in both hand. ADAS and cockpit solutions across the global auto market and to meet next generation euroMCAP safety standards. Hand. Seeing Machines is an industry pioneer in occupant and driver monitoring systems, known as DMS. We exist hand. To get people home safely. Underpinned by human factors, science and with access to more than 5,000,000,000 kilometers of hand. Naturalistic driving data. Our DMS was a key enabling technology which debuted in General Motors hand. Super Cruise, the world's first hands free driving system, showcasing our deep expertise in DMS technology backed hand. Delivering driver monitoring functionality into real world production vehicles requires a science driven understanding of driver behaviors, combined with hand. Design decision for the car maker with many performance and cost trade offs. Location options for the optics hardware are usually hand. Space constrained, packed with existing electronics, while also having high temperature demands. Tackling these challenges is our expertise. Hand. Today, together we bring to you the Seeing Machines embedded development kit for the Qualcomm Snapdragon cockpit platform. Hand. Leveraging Qualcomm's Snapdragon automotive compute reference design, this kit delivers a full stack DMS targeting cockpit solutions hand. And or centralized ADAS systems and fully supportive of Euro NCAP safety requirements. Welcome back, Zoe. Hand. The kit includes our latest automotive production grade reference optical system, interfacing hardware hand. And Seeing Machines' world leading driver monitoring software and tools. The Seeing Machines' eDME software libraries hand. Deeply embedded and pre validated into the Qualcomm software framework, allowing rapid product development cycles. This includes optional use of Qualcomm's hand. Extensive acceleration resources available in the Snapdragon platform. The Seeing Machines hand. EDK for Qualcomm Snapdragon Automotive Cockpit Development is available now. The C machine's EDK for Qualcomm's hand. Hand. Thanks, Paul. That's great, Luke. Thank you very much indeed for the presentation. Ladies and gentlemen, do please continue to submit your questions using the Q and A tab situated on the right hand corner of the screen. Hand side. But just while the company take a moment to review those questions submitted already, I'd just like to remind you that a copy of the slide for published Q and A hand can be accessed on the Investor Meet Company platform. I'd also like to remind you, feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to hand, provide your feedback in order the company can better understand your views and expectations. Paul, we had a number of presubmitted questions from answers. And perhaps I could hand back to you just to run through those first of all. And then once we've done that, we can just move on and click on that Q and A tab and read out the question where appropriate to do so and hand, run through the live Q and A, if that's okay? Yes, sure, sure. So look, we had, I don't know, 40 or 50 questions before the meeting, hand. Many of them crossed over. So I've we've categorized I'll say I. We definitely we've categorized them into 4 areas, hand. And I'll answer them accordingly without referencing the specific question. Otherwise, I think we might be here for a very long time. But hand. The categories are automotive, significant partnerships, fleet and the roadmap and company future. Hand. Some of these I've answered in my commentary as well, but I'll just whip through these categories hand. And answer the questions, and then we can go through those that have come through this morning. So I think we've covered the RFQ increase. Hand. We don't and are unable to talk about the volumes. There's a number of point talking about the volumes until they're awarded. So hand. We don't do that and we haven't done that in the past. But my statement is hand. True and clear, we have received more IRF cues of what we believe to be a greater quantum than in hand at least a year or 2 prior. So it's a really good indication of where the market is at. Hand. So the next thing is about naming cars that are coming into production. And again, we get this hand. Question all the time and must be repetitive to hear the same answer. We are restricted hand. And each OEM has a different slightly different take on the level of restriction, the time of the restriction. But typically, it's some time period hand after vehicles move into the distribution network, not when they start production. And we put in a lot of effort in order to try and hand. Get this communication released and it's a very difficult thing for us to do outside of the rules that we're predetermined. So I know it's frustrating. Hand. It's, I can assure you, it's probably more frustrating for me than it is for most other people. Hand. With regards to awards and when we announce them, we announce all awards when they're formally won. Now we often work with Tier 1s and OEMs hand. So long periods of time as we negotiate agreements, whether they be interim agreements, letters of intent, hand. Interim purchase orders or contracts and all of these things happen and they are all happening. Hand. But we are unable to make an announcement on a win until we have a contract hand that is signed despite the fact that we continue to operate on all of those other mechanisms that I've mentioned. Hand. So when we execute, we announce. Hand. Someone mentioned Japan. I think I covered that in my remarks. Japan is moving and we're pretty pleased with movement there. Hand. Engineers, there's a question about given cars into production, what are you doing with all your engineers? Hand. We've been running our engineering team at maximum capacity hand. For quite some time, our challenge is not what to do with the engineers. Our challenge is to increase capacity fast enough hand to win the business that's ahead of us. So if another question is, what's my biggest single biggest consideration or my single hand. The thing that keeps me awake at night is being able to build appropriately skilled capacity fast enough hand to win at the rate we think we should win and then deliver in accordance with those programs that we've signed up for. Hand. On the partnership side, look, I think I covered that in my remarks. We have a long list of hand. Companies in SoC, semiconductor companies and sensing companies and others that now want to work with us. Hand. We are very open minded on 3rd party working relationships. We think it's a permanent fixture in our strategy going forward and we'll continue to do so. Hand. And yes, it is difficult to quantify what opportunities come out of those, and we frankly haven't attempted to do so. Hand. I mean, as I said earlier, if a company like Qualcomm is investing their own money to embed or to pre integrate hand. Our software into their software stack on their platform and they have a 50% or 60% share of a given area like infotainment hand. In the industry, well, you'd have to have a view that, that would be incremental and positive. Hand. And the same applies for Olin Fisher. In terms of fleet, had several questions about OEM fitments and trucks. Hand. Look, it's a really interesting question. We do have dialogue from time to time. We're very focused on auto because that's the primary volume market that's driven hand. By the regulators at this point, and aftermarket can cover the fleet business hand. Quite adequately where it can't cover the passenger vehicle business. So I think there will be a market for OEM fitment hand in heavy vehicles. But I do think that that's some time off. But we keep a watching eye or we're watching brief hand. Yes, roadmap, yes, look, we are hand. Committed to providing the service here. There's a question as to whether we should do that or whether we should just move more hardware. Hand. I don't see any point in getting into a hardware only business. I think that's the surest way to be commoditized. Hand. And we've seen that across the market with players much larger than us that are in telematics. What's important here is that hand. Being able to offer the service dramatically improves the safety outcome. So having in cabin alerts is one thing, but providing the 20 fourseven service hand. Improves the outcome by an additional 30 plus percent. So that's a very important part of the buying consideration hand of the company when you consider the significance of this particular risk that they're running. Hand. There were also a few comments around Caterpillar and BDMS. BDMS is interesting. It's only now starting to hand. Pickup in interest. It's very good business for us. Small volume, high margin. Look, it's hand. We don't see BDMS as an environment where we're going to sell tens and tens of thousands of units. That's not really what it's about for us, hand. But it's an important element in our overall business for both sales margin and cash. So we'll continue to develop in that area hand. And we'll continue to support the customers that we have. Hand. Just on the company side, the investor side, we're well funded. And I think that's evident. Hand. And you can all see that through the numbers. The interest from U. S. Investors has been a strategy and it's a strategy that I would argue hand. It has worked. It's early days and I do expect that interest will continue. Well, put it this way, if the inquiry rate that I have for meetings in the U. S. Hand. Continues. I have no doubt that we'll be successful. We frankly turned down more meetings than we accept hand. Just because there's only a certain amount of time in a day to do that kind of work outside of running the operations of the business. But hand. We're really encouraged and really pleased with where that's going. The next group of questions, there were several around the NASDAQ listing. Hand. Look, my answer to that is, again, we keep an open mind. We do talk about hand. Other markets to list NASDAQ in particular amongst the management and the Board. My view on this is that in the next hand. Short period, let's say for the next year or thereabouts, what's more important than entering into hand. A new listing is to ensure that we win our fair share of business hand. And that we're on track to deliver those programs. Because if we move to NASDAQ too soon and to be frank, lots of bankers would argue hand. It's a good thing to do. The rules change dramatically. The rules from AIM to NASDAQ are very, very different. They're considerably more onerous. Hand. And I'd like to be in a position where we have a level of confidence and a level of revenue visibility, hand, particularly in order out beyond 2025 before we contemplate it. But it is on our mind. It is a subject that we talk about. Hand. And at the right time, we'll make a decision one way or another. Hand. So they were that's a summary of kind of the 3 questions. Shall I read these out? Hand. Yes. If you could just click on that Q and A tab and just go through and pick out those questions, you're happy to respond to. I know, obviously, some that you've covered during the presentation and that Q and A session as well. So back to you, if you'd mind, that would be great. There's a question for Kate on the split of shareholders between private and institutional. Hand. Yes. So I'd say about 65% of our register is institutional and about 35 hand. It's retail. And of course, our top 2 shareholders hold nearly 10% of our shares. So they obviously form a big part of the institutional hand component. Naomi, this question for you. Has the cash started flowing from the Ford contract, hand. The F-one hundred and fifty in the marquee. Now look, this is one of those things and I've read it out. It's not a mistake. I've read it out because hand. It's in the public domain and it's one of those things that we are yet unable to speak about specifically. Hand. I think the official answer to that is no. Hand. Another question on RFQs, what's the total value of the pipeline? We don't communicate the value of the pipeline and hand. I won't be joining to doing that today. But what I've said and what I'll continue to say is that the RFQs that we've received hand. Since November are very significant when measured against hand. The total one business today. Now there are a few very technical questions hand. I'll put this one to Naomi. What are the withholding tax implications for your income hand. From overseas countries, will they add up to the effective tax rate of the company or be fully creditable? Hand. Now this is an area that we talk about frequently. So over to you, Bonnie. So we have a range of measures hand. In respect to withholding tax, so once we're profitable and we've got down all of our tax losses from prior year, so this will be hand. But another avenue that we're taking whilst we're working through that process is to gross up full withholding taxes. So at the end of the day, hand. There's no loss to shareholders and investors. Hand. Hand. Fast enough to win hand. Our fair share and that's closely followed by us being able to deliver that fair share. Hand. I've not got any lay awake moments on competitors. The market this is a DMS alone if we just park fleet for a second hand. It's a $1,000,000,000 a year market. There are a few competitors in it. And as I've said many times, I hand. I don't think it matters that much whether you're going to win 35% or 40%. But we've got a strategy that differentiates hand. And we'll continue to prosecute that strategy. So it's skills and capacity that I'm focused on. Hand. Question about profitability, income exceeding expenses, we've spoken about that several times before. It hasn't changed. It's in the FY 'twenty three year. Hand. I think we've spoken about funding. Hand. Is the Tornado investment reflected in the number that Naomi presented in terms of the cash? Hand. No, it's because that cash number was at end of December and the Toronto funds were received only recently. Hand. Bear with me. Hand. Qualcomm, I know our focus is transport and Qualcomm have commercial relationships with others. But given they're hand. Doing work to integrate our technology on the auto side. Is there any chance that they would expand into VR or other verticals? Look, that's a great question. Hand. And it's a question that isn't I understand that whoever's asking is talking about Qualcomm, but it's not specific to Qualcomm. Hand. To be frank, we get unsolicited proposals to explore eye tracking in hand. All kinds of new verticals on a semi regular basis. If we take the Omnivision business, for example, hand. I mean, they have a 30% share of order, but they have a significantly higher share of security. Hand. Doorbells, for example, we think there's a fantastic application for eye tracking in doorbells because hand. The one place where people are very okay with you being monitored is at your front door. Hand. So the question there is how quickly can you get the economics of high performing eye tracking into a small enough device hand. That you can sell on the doorbell that probably retails for $20 So look, I think these things will come. But hand. Just to be straight on this, we are at least for the next few years very focused on transport. It's at least hand. $1,000,000,000 market opportunity per renter, U. S. Dollars if we exclude fleet from it. So hand. That is by far and away our primary focus. Hand. This question about the raise, we did one to Federated, we've done one to Toronto. There are several questions hand. That are similar. And it's pretty simple. Hand. The answer to the question directly is do we have an intention of raising again in the U. S. Hand. And at this point in time, we don't. If the other questions were asked around NASDAQ, hand. If that strategy comes to life, well, of course, that's a different set of characteristics that would cause us to reconsider. Hand. But we took Federated because it was a landmark investor that changed sentiment in the U. S. Hand. Toronado is a little different, specialist investor. We were able to do that at a premium, which we thought was a good thing to do, hand. But they have a significantly higher book expectation than the $10,000,000 So we think hand. Another good investor, more on market buying capacity and further support because the reaction that we've received hand. From both of these investments from the U. S. Market is overwhelmingly positive. And this is drawing new U. S. Investors hand to us who have the only the opportunity to acquire a market. Hand. The 31,000 units in OEMs, the question is over what period? That was in the in that half hand. Hand. Look, there's a couple of similar questions in here about BDMS, about Colin Barndon and articles. Hand. Look, we have contracts with customers hand. And we honor those contracts. Occasionally, journalists write things that are incredibly insightful and accurate. Hand. And sometimes we can respond and sometimes we can't. Occasionally, we ask permission whether we can or we can't. Hand. And if we don't, you know what the answer is. Other articles that are written are miles off the truth. Hand. And we don't have a requirement to respond to those. So any contracts that are signed hand. With any customers that have a confidentiality clause in them, we'll be honored by us without their permission. Hand. So look, I'm going to go to perhaps one final question here. Hand. I've answered some of those. Okay. Here's the final question. I'll take on. We're running out of time. Hand. Are we working on a Gen 3 product for Fleet? Yes, we are. So what would be different? Well, it'll be hand. Over the lifetime of hardware and systems development since the first inception of generation 1 and generation 2 to now, hand. There's been remarkable improvements in form factor, size, processing capacity, communications. Hand. So we are in the design phase of a Generation 3 product. And I can't really comment at the moment on what act. Looks like or when the timing is, but we're well advanced on those developments. So I apologize if I haven't got to every question. Hand. I think in aggregate, we've answered 50 or 60, one way or another. And I really appreciate your comments. We will get back on specific questions that we haven't had a chance hand. Thank you very much. Thank you, Paul, and Casey Naomi as well. You have addressed, obviously, a heck of a lot of those questions, and you will have the ability hand. You can review them later on the platform. And Paul, before we redirect investors to give you some feedback, perhaps I could start you for a final few words just to wrap up, please. Hand. Well, thank you. Well, look, I'd like to thank all of you for supporting our business or your business, I should say. Hand. I hope that everybody is quite pleased with the increase in the share price over the last year or so. Hand. I'm actually quite pleased that we're consolidating at the levels that we're at. If I consider where we're at today hand. Within the context of the market that I've just described, the intake of new business opportunity that I've described and the change in sentiment, hand. Particularly in the U. S. Around our technology, I think this all goes well for a pretty bright future over the next few years. So hand. I'd encourage you all to stay with us, and I hope you do so. Thank you. Hand. That's fantastic. Thank you very much indeed. Thank you for updating investors today. Could I please ask investors not to close the session as you'll be automatically redirected for the opportunity hand to provide your feedback. If you've accessed the meeting from our website, the feedback page will appear directly in front of you. If you've accessed via the link sent to you in an email, hand. Please just click on the e mail and log back in. It takes just a couple of minutes and your feedback is greatly received by the company. On behalf of the management team of Sea and Machines Limited, we'd like to thank you for attending hand of today's presentation. That now concludes today's session. Thank you.