Good morning, everyone. Paul McGlone here from Seeing Machines. I'm here today to present to you the financial results for FY 2020, and we'll also give you an update on how we've performed over the first quarter. Needless to say, trading conditions for us and for everybody over the last 12 months have been very, very challenging. We're also quite pleased with the outcome. Our business has continued to grow. We've continued to manage costs and cash, and I think as everybody has now seen, we've had a post-close event, which has shored up our balance sheet and gives us a great deal of confidence moving forward that we can execute the plans that are in front of us, and frankly, set ourselves in a position to deliver the growth that's been on promise for several years now.
With that being said, I'd like to walk you through a presentation, and this presentation will cover the numbers for FY 2020, will give you a sense of where we're going strategically in each of the segments that we operate within transport, and importantly, give you some insight into our first quarter's results, which, as I said, are quite pleasing. I do expect that trajectory to continue through the first half. A good start to this year, a pleasing result under the circumstances for last year. If you give me a few minutes, I'll take you through the story and, hopefully, that will resonate with all investors at this point in time. From a highlight point of view, revenue of AUD 40 million, which is a 25% increase from the previous year.
Again, given the circumstances of COVID, we're quite pleased with how revenue is closed for the year. We're seeing underlying growth, and in particular, our fleet business continues to do well. The annualized recurring revenue up 17% on the same period last year at AUD 14 million. This is a very important element of our business today and will remain a very important element of our business going forward.
As our fleet installation rate grows, this recurring revenue grows in alignment. It's got a compounding effect and frankly underpins the cash flow of our business, at least out until 2023, when we'll start to see very significant revenues from our automotive license revenue begin to contribute significantly. Cash. We're very pleased with the cash result. 22% above consensus. That's a combination of initiatives that we took to reduce the cost of doing business. Also, good receipts from customers.
We significantly tightened our commercial operations and our terms of trade. All of those things have contributed in some way to our cash position. Of course, we have had some government support, as many companies have, through the course of the year. That has also been a help. Just recently, we announced a placement to Federated Hermes, a very large and successful fund manager in the U.S., of $28 million. Our cash position today, we are very pleased with and very confident that we'll be able to execute our plan as previously articulated. This is a very important new injection for us. I have talked about it as being strategic. I do believe that it is. I'll just spend a minute just explaining myself there.
We've been talking with potential new U.S. investors now for many months. We get a resounding positive feeling from most of them. The big issue has been liquidity. Enough stock on market for new investors to form a position. In our view, this placement was a very important first step in order to get an important and sophisticated U.S. investor on our register, and we're certainly of the view that this will enable other U.S. investors to follow. From the point of view of introducing our technology and our company to new investors that frankly have a sophisticated approach. They understand small cap growth, and they understand technology. They, in particular, understand automotive and transport.
We think this is, of course, the injection to the balance sheet is important, but it's also important, we think, as the first step in attracting significantly more U.S. investor on market support for our company. I'll take a look at a few of the operational highlights, many of which we've reported. The first one I'll start with is we have two automotive programs coming into start of production this calendar year. One of the great frustrations in automotive, as I think everybody knows, is that we're unable to speak specifically of the OEMs and the vehicles that we're launching or where our technology is being launched. That is hopefully just around the corner. It's a very important milestone for us as we've delivered technology that's leading, very sophisticated into two very prominent and major OEMs.
This is the inflection point for us in automotive, and it's the start of a rolling number of vehicles that will hit the market over the course of this year and next. In fleet, our Guardian Connections increased 46%. Again, as everybody knows, the market was very difficult during COVID, certainly up until May, June of this year. I think the important thing here to mention is that a rather perverse reason for the slowdown for us was not that the businesses that we were supporting were under financial stress necessarily, because most of the fleets that we sell our product into are large fleets that move fast-moving consumer goods. Their problem was utilization. They were all operating in the maximum capacity right up through until around about July. Getting access to vehicles to install was very difficult.
Pleased to say that the recovery is well underway, As I talk through the Q1 results, I'm sure that you'll agree with me on that. Now, from a regulatory point of view, we continue to be supported directly and indirectly. Regulators and influencers in all of the major markets around the world are pressing for a reduction in fatigue and distraction risk, Our technology is specifically designed to mediate those two risks. I think by now everybody would know that the single biggest contributors to claims costs, certainly in the trucking environment, are fatigue and distraction in that order. They lead the way in terms of claims cost by some distance. This is not only about cost, though, it's also about the impact on human life.
It's very clear, as I talk through some of the operating statistics of our fleet business, you'll see that what we do has a profound impact on human life. That's why our purpose is to get everyone home safely. Our ultimate ideal is zero road deaths. That's very lofty. I understand that. It's the purpose that drives us. When we talk about artificial intelligence, machine learning, the application of new technology, we're in an environment where we're deploying this technology to have a profound impact on human life. I think that's what sets us apart from many other technologies that are available in the market today. Of course, we've traveled a long way. Our technologies accumulated more than 5 billion km.
That data is central to the continued tuning of our algorithms that enable us to deliver automotive and aviation-grade monitoring systems. That's something that differentiates us quite profoundly. Euro NCAP, still a very strong global leader in safety, and the rest of the market are following the lead from Euro NCAP. We now have a product or, in fact, a family of products that are specifically optimized to deliver mass market driver monitoring systems that adhere to the safety standards of Euro NCAP. We can move up and down the quality stack with ease, given the portfolio of software and hardware applications that support our software, covering every location in the vehicle. It seems quite a long time ago now, but in January, we were at CES, and again, it's been well-publicized that we were on the BMW stand.
We have a wonderful relationship with BMW, and that continues to develop. I think that's also testament to the quality of our technology, and we see that kind of relationship expanding over time. On the strategic partnership front, this is very important to us. We've elected to expand and collaborate more. I called out more than a year ago now that we were moderating our strategy to seek every opportunity to leverage our intellectual property, to do that through collaboration. We've recently announced a couple of MOUs, which are very specifically a result of that strategy. Over time, I'm quite confident that those relationships will build into agreements that support the development of our technology more broadly and faster as this market continues to develop.
Of course, over the course of the FY 2020 year, with the COVID issues that we had to face, we made some permanent adjustments to our cost base and reduced cost of doing business by AUD 12 million. Those costs are now in place. The cost of that transition has been booked, and we will see those benefits flow through over the course of FY 2020 and FY 2021.
From an operational point of view, despite the environment, there has been a lot of work go on in the business. All of our teams are fully engaged and fully occupied, and we have never been busier. Turning to the numbers now for a minute, this is a chart that shows revenue from 2017. There is really just a couple of things I want to point out here. We can see the growth from 2019 to 2020, which we are very pleased with.
We know that there was a one-off license fee in our OEM business, our automotive business, late last year, which contributed to a strong result. Our aftermarket business continues to grow. I'll just draw your attention to the period 2017 to 2018, though, where we saw a significant jump in revenue. You might ask the question, well, what happened? I think now most investors know that at that time, we had a range of issues, predominantly in our fleet business. In that 2018 year, we aggressively sold a lot of stock into our distribution network. We subsequently had some technical issues, and the way in which we sold that stock, frankly, caused a range of commercial issues that really caused that business to stand still for a year. Now, we've worked very hard to unravel those issues.
We've stabilized the technology, we've introduced new features. We now have a platform that is ready for growth. That growth rate, you can see between 2019 and 2020. On the commercial side, we've unwound a lot of the problems that we had in that 2017 to 2018 period. We now have a commercial platform in Fleet that we're very pleased with. It's very solid. We can now attain good gross margins for every hardware sale. We have, on average, three to five year contracts for every deal that we do with customers. The business is very sticky. We also enjoy very strong margins in that recurring revenue that's derived from the services that we provide. The business today, in Fleet, in particular, is definitely in a far stronger position than it has been at any time in the past.
All business that we write today is profitable, whether it be from a hardware point of view or a services point of view, and we expect the underlying growth rate of that business to deliver profitable revenue and cash positive returns from here forward. We're quite pleased with how that's going today. In terms of the P&L, I'll just draw your attention to a couple of the line items. Of course, we'll publish the detailed accounts and notes, which you can all review in your own time. On the left-hand side, we've got the statutory result, and on the right-hand side, the normalized result, where we've highlighted some one-offs and some changes in the way that we manage our business. Firstly, we've set the business up into two P&Ls, OEM, which includes auto and aviation, and Aftermarket.
We've done that so that we can fully allocate the costs into those P&Ls and increase our focus on profitability. This is already having good results. We can see revenue growth 25%, and gross profit improvement as well. This business going forward, we expect to see strong double-digit growth and strong underlying margins across the board. This is a very important reset, not just in the way we manage the business, but in our narrative going forward. We're focused on cash, we're focused on profit, and we're focused on performance. Despite the loss for the year, which is significant, on a normalized basis, it's better than we had planned, and we expect that that loss will reduce in a linear fashion between now and 2023.
I'll refer to 2023 several times because that's the year in which our automotive license revenues really begin to take off. From that point forward, under our current plan, we expect significant positive cash generation and profitability. Same for the balance sheet and the cash flow. You can see in the cash flow there that we have quite a good outcome in terms of managing cash. Our net working capital is strong. You'll note reductions in trade and other receivables and inventory. We're managing the business more efficiently. We have better terms and conditions that are reducing our receivables balances. We have a better operating environment and a better supply chain where we are able to reduce inventories and more closely match inventory purchases with sales through to our distributors.
That's obviously very important for cash flow, but it's a sign of the improvement in the underlying efficiency of our business, primarily today in Fleet. We're quite pleased with our balance sheet position. Of course, the new injection of cash strengthens our balance sheet even further. As you'll see in a minute, our Q1 results, I think are the first landmark that point out that this improvement is well and truly underway. I'll take you to the outlook now. Firstly, talk through this whole issue of performance. I'm of the view that we have a number of strategic imperatives, of course, but the most important strategic imperative is that we perform.
Performance is central to us delivering on the promise, but it's also central to you, the investors, and the market more broadly, believing the long-term potential that we have, or even the medium-term potential. It's very difficult to do that if you are a serial underperformer. Our internal mantra today is that performance is the most important strategic imperative, and on the back of that, we will be given permission to continue to grow.
For Q1, and for the first time, I'm very pleased to say that we're ahead of target or ahead of budget by some 10%. If we look at Q1 from a revenue point of view and look at the same period last year, we're 20% above that period. For me, this demonstrates that we have an underlying growth rate that is now consistent, and we're confident that that growth rate will continue.
We have far better financial controls. We're far better able to forecast and plan. Of course, that's wonderful, but without the whole team's focus on delivery, it's all for naught. We're planning better, and we're delivering against our commitments, and that's very, very important. Year to date cash. Cash at the end of September was AUD 35 million. As you will recall, I just pointed out that cash at June was AUD 38 million. We've done very, very well in terms of cash management, excluding the additional $28 million investment, and that sets us up very strongly for the future. Just a couple of call-outs on automotive. We're very, very strong in driver monitoring. We've recently launched our occupant monitoring strategy and product. We're now in the marketing phase for occupant monitoring.
We see this as being additive or complementary to what we do in driver monitoring, and early signs are very, very positive for how we're rolling out that addition to our portfolio. That will be an important part of our business going forward. The primary focus today and for, frankly, the medium-term is, of course, driver monitoring systems, and they will be augmented with occupant monitoring, looking at the front two seats and ultimately all occupants in the vehicle. Our engagements in the semiconductor space, you've seen announcements there. We continue to explore every opportunity to build relationships in that space. That, again, I think is a differentiator for us. It's a specific and purposeful strategic shift. It, of course, doesn't mean we're in the hardware business. We are not. We are in the software business.
We've taken or gone to the effort over several years, first with FOVIO and now with our Occula product, to accelerate our software and present it in a way that it can be licensed to expand our reach across all areas of the automotive space. At long last, we've been able to execute a memorandum of understanding with L3Harris. We're very excited about this. Of course, aviation has been very significantly hit by COVID. As I've mentioned before aviation can recover, they need to bring back online pilots, have them recertified or trained. The simulator space is a very, very important and early signal to the rest of the aviation environment and critical to recovery.
We're very pleased to be working with L3Harris and the customers that we jointly support, and we expect that on the back of this, there will be a license agreement closed that will enable our simulator product to flow through into the end users. Very pleased with that. In automotive, I just wanted to draw everybody's attention to the market. There are two charts on this page, the left by Semicast the right by ABI. What this shows you is total vehicles in the dark blue line, an expectation from Semicast on worldwide DMS units, and then the installation rate in percentage terms in the light blue line above. The reason for putting this picture up is to reconfirm that the addressable market for us and the addressable market for DMS is very, very substantial and increasing rapidly.
100 million vehicles a year, of which Semicast believe some 70% odd will take up DMS by the year 2026 and potentially higher penetration rates beyond that date. All of the work that we've done over the last five years with that heavy investment in research and development, heavy investment in getting our technology designed for each individual application is now starting to show results.
We have start of production this year. Those start of production vehicles will increase, and they are increasing in a market that's very large and growing very rapidly. That is a unique opportunity given that the number of players that support this market today are very, very limited. They're very limited because to develop accurate eye tracking is a very, very complicated thing to do. It takes a long time, and it takes a significant amount of money.
We believe that we are well set to take our rightful share of this large and growing market. As I've said before, today, we are at that inflection point. If we move to the next chart, through another researcher, you'll see some differences in the take-up rate, which you would expect, as different people have different assumptions that underpin the market.
We've also added here occupant monitoring in the green box. You can see that while small in the scheme of things, we do believe it's incremental. We have some very good technology that we've delivered into proof of concept for wide field of view cameras that deliver, frankly, DMS performance across the front two occupants in the cabin. This is an incremental play for us. You can see very clearly that DMS is central. It's the driver. It's the big growth environment.
I'm sure that occupant monitoring will grow faster the further out we go. Right now, the core focus is DMS. DMS as an element of occupant monitoring and the upside potential for us, and the upside potential for safety on the road is very, very significant. This is a simple diagram. It's stylized, it shows you the OEMs coming online at the start of production date, across this year and next. As you can see, we have several OEMs going to start a production this year. As we win more RFQs, they will sit on top. This delivers a cumulative outcome in terms of licensed volumes going forward. Again, I've said many times that the important thing to look at here is that a business that is involved in this kind of technology delivers ongoing volumetric growth.
The OEMs are professional procurement organizations. They will choose player A or player B for all kinds of reasons. Not always technical, often commercial, often to do with the Tier 1, nothing to do with the Tier 2. What's important is that we continue to deliver volumetric growth in our license revenues that flow into production. This picture demonstrates that. You can see over this next year or two, each of these programs sits on top of one another. They stretch out six, seven, eight years. That is the profile that will deliver the underlying growth rate in our license volumes for automotive going forward.
Now, between here and 2025, 2026, if we take the one-off engineering services out of the automotive equation, this business alone, this automotive business alone, delivers a compound growth rate or an annual growth rate of roughly 100% a year between now and 2025, 2026. Driven by the booked business that you see on this stylized chart. Again, a very strong sign that this business is at the inflection point. These production volumes are locked in. They will grow exponentially. Of course, we expect to win additional business throughout the life cycle. This is a very strong position statement for us, referencing those market slides that were on the previous page. You can correlate from those two pictures quite simply that this business is poised now, today, for significant growth. The OEMs have a challenge, of course.
That is, they have a large range of vehicles, models. There are a number of challenges in terms of where to place a driver monitoring system, where to place the camera, where to place the processing. These challenges are very complex. With Euro NCAP mandating this technology, it is also about cost. This challenge is about cost, complexity, and choice.
Our strategy is to work with the OEMs and deliver them a range of options to deploy our software into any of the locations that are viable inside of the vehicle. On a standalone basis in the instrument cluster, above the head in the mirror, in infotainment, or in this ADAS environment. Now, to be able to present all of those choices to an OEM, in our view, enables them to consider a supplier in the context of low cost and lower risk.
Our work with the silicon side of the equation in this whole supply chain enables those options to be presented in almost a prepackaged way, if required. Of course, we still develop software, and we will still integrate into any environment that is available, as we do with 70% of the business that we've won today. We're firmly of the view that this move into embedding our technology into the platforms provided by others, increases optionality, reduces cost, and ultimately reduces risk.
They're three factors that are very, very important to the OEM. This little picture here is an example of our wide field of view camera in use. It's in the market today. We're responding to RFIs as we speak. We're very pleased with how this technology has developed. I've mentioned the partnerships already. Everyone knows about Xilinx and our FOVIO Chip.
We've spoken about Qualcomm, and we're deepening our relationship with Qualcomm. We have other silicon players that we're talking to and have announced one MOU to that effect. This strategy is well and truly underway. Our three-pillar strategy, we think is right, and it's designed to solve the problem of the OEM. Turning to fleet for a moment. This map represents the locations of the vehicles that we support around the world. You can see that our spread is growing all the time. We're very pleased with this growth. Let me just call out a fact or a couple of facts that go back to the sort of central position on purpose, and that is that everybody deserves to get home safely. Our technology has identified 7.6 million distraction events.
More importantly, we have intervened directly in more than 165,000 fatigue events in the last 12 months. I'm not going to say that every one of those fatigue events would have resulted in a catastrophic accident. There's no doubt that a significant number would have. You can see at the current size of our business, which is still relatively small in the great schema. Even at that level, the impact that we're having on human life and safety on road is frankly profound. This amazes me, and it's something that I'm very passionate about, and it's something that everybody in our business is very passionate about. This is what drives us. As a consequence of that delivery, being able to deliver up that level of risk mitigation to customers, we've seen our customer numbers grow by over 60% at the end of FY 2020, despite COVID.
We've reset our commercials, as I said earlier. We've got better pricing in place through our distributors. We've got lower costs that are now both flowing through from this quarter. As we go forward, you'll see margin expansion in this fleet business as it grows. I'm very positive on fleet. Different investors have a different focus, some on auto, some on fleet. The combination, in my mind, delivers a balanced outcome that mitigates, to some extent, the long delays in automotive until we get to 2023, when we see all of those big production numbers flow through. This business will continue to grow at double digits, deliver recurring revenue, which is very, very important, and have the kind of safety impact that we're seeing here, which will grow year-on-year-on-year. We're very, very pleased with that.
We're also in the advanced stages of design for our Generation 3 product and also Generation 4. This we're quite excited about because these are the advances that will enable us to penetrate below the heavy fleet niche that we currently serve. That is light commercial vehicles and trucks less than 15 tons. This is the environment where the addressable market opportunity grows for us very, very rapidly. Let's have a look at what that opportunity is. We look at some research from Frost & Sullivan, and this is the video telematics segment. One could argue that we're in a sub-segment of that called video safety telematics. Either way you want to look at it, the addressable market in this space is very, very large.
In the dark bar, global units, you can see Generation 1 and 2, yellow, very, very small, doesn't even register on the graph. The light blue line is our total market penetration. Today we're at about 2%-3%. We expect that we will grow our business to 7% or 8% over the course of our planning horizon, which is 2025. Still, those numbers in the great schema of video telematics are very, very small.
This is a picture that gives me great confidence that despite the small scale of our business today, and frankly, on those numbers, the relatively small scale in 2025, this market opportunity and the business model that we deploy here will deliver very significant value to shareholders over time, particularly now that we have good product that's fit for purpose, doing its job, reducing fatigue and distraction risks in the numbers that I've mentioned, and with a set of commercials that deliver profit and cash on every deal that we do. I'm quite excited about the potential. We have no big claims to say that we're going to be 10%, 20%, 30% of the market here. Very modest market share, but is a very high contributor to value for us. This is a great market opportunity. Regulation, of course, is impacting in every market.
I've mentioned already that fatigue and claims costs and insurance are the highest drivers of cost. As a consequence of that, insurers become more and more interested in us. We have a formal arrangement here in Australia with NTI Insurance, market leader, where we're co-developing and distributing product with insurance benefits to the end user. We have insurance tie-ups in other markets as well, our Mexican distributor, and in fact, our South African distributor. Our distribution channels continue to expand. Our new distributor in Taiwan just recently has sold their first customer in a few months. It normally takes nine months or more for a new distributor to get going. We're really pleased with progress there.
As I've said, we have a product roadmap that can now reach out beyond the niche of heavy vehicles and into light commercial, and that opens up the market opportunity for this particular business very significantly. In aviation, it's an early stage. It's a horizon 3. We talk about it a lot because we've created the eye tracking market in this segment. I think all investors would know, we receive many accolades for the technology, and I guess everybody's saying that's great, but where's the money? The aviation business is similar to automotive.
There's a long lead time. There's capital investment, there's engineering services, and then there's production. The important thing to recognize in aviation is that we have created this market. We have a leadership position. The accolades that we've received are for good reason. Now let's just turn to what the market opportunity looks like.
The average selling price for our technology in aviation is significantly higher than in the other markets that we operate. Of course, total units is lower, the average selling price compensates for that and some. We look at simulators primarily for training in aircraft, for pilot monitoring, and in consoles for air traffic control. We see the direct serviceable market for us in simulators, in commercial at north of AUD 200 million, AUD 280 million for military, and we have units in play across commercial and military today. The announcement with L3Harris will enable us to expedite the development of the simulator market and grow it over coming years. In terms of aircraft, again, lower volume, significantly high opportunity. AUD 500 million for commercial, more than AUD 500 million for military. In consoles, again, more than AUD 500 million.
I thought it important to point out, now that we're making progress with the partners that will deliver our product, to call out what the opportunity is. Yes, it's still definitely horizon three, but this is an opportunity that should not be unnoticed. Okay. Let me just close by kind of recapping where we're at right now. The automotive market, the penetration of driver monitoring systems, the addition of occupant monitoring systems, and the volumetric potential of that business is very significant. We're at an inflection point. Our customers' vehicles are hitting the start of production. That will continue in a linear fashion over the next two financial years, which will deliver year-on-year growth in licensing of approximately 100% per annum. This is very important.
After years of investment, we can see the future, and the future looks very good for automotive software licensing of DMS and OMS across the board. Regulation is not abating at all. Yes, there's some conversation around the COVID impact. There's some conversation about potential delays. This is a permanent meta trend that can't be stopped. The impact on society for the number of accidents, more than 1.3 million a year, can't be ignored. Regulators around the world in all areas of transport are seeing this as a permanent feature. Our strategy has evolved. It started with FOVIO Chip. Of course, software's central. Now we have other arrangements where we embed our software and offer it for license. We expect that that will continue.
The objective here is to deliver across all of the problem areas of the OEM, reducing their risk, improving their choice, and lowering their cost. We're very happy that we think that we're on the right path. Recurring revenue, new channels, growing around the world, again, supported by regulation. Different business model in fleet, shorter sales lead time. Very sticky business. Less than 2% churn. Having a profound impact on drivers and society as we identify and remove fatigue and distraction risk. Aviation, again, horizon three, very large opportunity. Opportunity that we as Seeing Machines have created, and we think we're in a strong leadership position there. To cap it off and to remind everybody that we will continue to pursue opportunities to leverage our intellectual property wherever we can.
Our focus today is on transport. I'm sure that as we get involved in more of the large silicon partnerships that we've been talking about, who knows? The opportunity for deployment of accurate eye tracking beyond transport may well become a reality for us. Today, very focused on transport and the strategic relationships we're building I believe will see us perform very well over coming years. On that note, thank you for listening. I hope you're pleased with these results and in particular, how we've kicked off this new year with good results for Q1. I expect that those results will continue through to the half. As I say, our primary focus is on performance, and I'm firmly of the view that performance will give us the permission to continue to grow. Thank you very much.