Correction: Final Results

RNS Number : 3077Q

Seeing Machines Limited

17 October 2011

 



17 October 2011

This release replaces the announcement entitled "FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2011" released by Seeing Machines Limited at 07.00am on Monday 17 October 2011 with RNS Number 2748Q . 

The following amendment has been made:

In the statement of cash flows, net cash flows used in operating activities were misstated as being an inflow from operating activities.

Seeing Machines Limited

("Seeing Machines" or the "Company")

FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2011

Seeing Machines Limited (AIM:SEE), a leading developer of facial image processing software for applications that rely on understanding the movement of human faces and eyes, announces final results for the year ended 30 June 2011.

Financial Highlights

·    Revenue increased by 60% to A$7,161,938 (2010: A$4,469,032); 

·    Gross profit increased to A$4,875,031 (2010: A$3,166,015);

·    Operational expenses increased to A$6,745,093 (2010: A$5,159,036) due to investments in DSS R&D, Sales & Marketing and support staff; 

·    Net loss of A$2,174,951 (2010: net loss of A$1,769,839)

·    Cash at 30 June 2011 decreased to A$1,648,786 (30 June 2010: A$3,904,954) mainly due to investment in DSS

Operational Highlights

·     DSS pipeline expanded significantly during period and a number of new customers were secured

·     Signed most significant Production License deal to date for faceAPI for glasses-free 3D displays for consumer electronics

·     Staff headcount increased from 29 to 36 during the period

Post year end

·     Appointment of technology entrepreneur Ken Kroeger as CEO

·     Toshiba released Qosmio F750 containing faceAPI technology - the world's first glasses-free 3D laptop

·     Contracted with Toll Group to deploy DSS into road-going mining trucks

·     Additional DSS business secured in North America and Australia

Commenting on the Final Results, Seeing Machines Chairman, Bill Mobbs said: "2011 has been a period of considerable investment for Seeing Machines as we move forward with our strategy of commercialising our products and technology. During the period we have expanded our sales teams, improved our technology and further developed our service offerings.

"As a result, we are seeing an increasing number of opportunities and this in turn is leading to an expanding pipeline. As such, we are confident of continued revenue growth in 2012 along with an improved financial performance."

The Annual Report and Financial Statements will be sent to shareholders and a notification of this will be made in due course.

For further information, please contact:

Seeing Machines Limited	[phone]
Ken Kroeger, CEO	www.seeingmachines.com
Daniel Stewart & Company plc	[phone]
Oliver Rigby
Walbrook PR Ltd	[phone]
Bob Huxford	[e-mail]
Helen Westaway	[e-mail]

Directors' Report Extract

Financial Results

Total revenue for the year was A$7,161,938 an increase of A$2,692,906 (60%) over the prior year (2010: A$4,469,032).  Revenue from sales of goods, license fees and services was A$7,024,749 (2010: A$4,245,850).  The increased revenue was largely due to the DSS which returned A$4,300,715 (2010: A$1,132,148) an increase of 280%.  Other income was A$137,189 down by A$85,993 (2010: A$223,182) due to unfavourable foreign exchange movements on both sales and purchases. 

Cost of Sales was A$2,149,718 up by A$1,069,883 (2010: A$1,079,835).  Operational expenses for 2011 were A$6,745,093 up by $1,586,057 (2010: A$5,159,036).  This was largely due to the investment in DSS R&D, Sales & Marketing and Technical and In the Field Support. 

The Group made a net loss of A$2,174,951 for the year ended 30 June 2011 (2010: loss of A$1,769,839). 

The Group had A$1,648,786 in cash at 30 June 2011 compared to A$3,904,954 at 30 June 2010. 

The loss and the consequential decrease in cash were due largely to the investment in the DSS in the areas of:

·    sales and marketing;

·    customer support including technical and field support: and

·    research and development on the DSS and DSSi.

Driver State Solution (DSS)

The DSS achieved revenue of A$4,300,715 (2010: A$1,132,148) an increase of 280% over the previous year.  Throughout the 2011 financial year the installed base of DSS units has continued to grow along with the number of blue chip mining customers either using or planning to use the DSS.  North America has the largest number of deployed systems but there are also significant deployments in South America, Australasia and Africa.

The strategy for commercialisation of the DSS technology is strongly focused on the global mining and resource sectors through direct sales and channel partners.  Channel partners were appointed for Africa and South America and there are a number of significant developments underway in these regions. 

The DSS pipeline continues to grow, offering further opportunity for growth and profitability in the current and future years.  The Group's strategy is to derive revenue from:

·    product (equipment) sales and recurring maintenance;

·    specialist services to support the installation of the DSS; and

·    specialist consulting, data management, analysis and reporting services.

A strong focus will be on growing the services side of the business particularly through our data management, analysis and reporting services made possible through the DSSi database analysis and reporting suite. 

Seeing Machines blue chip customers currently include:

·    Freeport-McMoRan (installations in United States, Peru, Chile and Indonesia);

·    BHP Billiton ( Installations in United States, South Africa, Chile);

·    Newmont Mining Corporation (installations in United States and Australia);

·    Toll Mining Services (installation in Australia); and

·    Xstrata (installation in Chile)

Since the end of the 2011 financial year, additional business has been secured with both existing and new customers which will further expand the DSS installed base over 2012 and 2013. 

During the 2011 financial year the Company has invested to support the current and future growth of the DSS business through:

·    expansion of the DSS sales and service capability within the Company and through channel partners;

·    development of the DSS hardware platform to:

o  increase product ruggedness (tailored specifically to the resources sector) to reduce field support costs;

o  reduce dependencies on expensive sub-components;

o  reduce cost of goods (COGS) to streamline production and increase product margins;

o  increase competitive barriers to entry; and

·    further development and enhancement of the DSSi to support existing customers and to underpin the Company's services offering which is expected to generate significant revenue in future years. 

The Company's focus for DSS during 2012 will be to:

·    Significantly expand the DSS customer and installed base in Australia;

·    Directly grow the DSS customer and installations base in the countries that we will directly service and support including the United States, Canada and Indonesia;

·    Through existing channel partners grow the DSS presence in Africa and South America;

·    Appoint further channel partners to develop the DSS presence in other regions where there is demand and where it make sense to work with a partner;

·    Grow the Company's service and support capability as required to service the growing customer and installed base;

·    Develop further commercialisation opportunities for the DSS technology in other sectors either directly or with partners; and

·    Progress DSS hardware and software development projects to support the business objectives.

faceAPI™

faceAPI achieved revenue of A$484,446 (2010: A$506,555) down by A$22,109 (4%) over the prior year.  The majority of the revenue generated to date has been achieved though Developer License sales and the reduction over the prior year is largely due to the adverse foreign exchange variations.  faceAPI Developer licenses are sold in US dollars globally.

In March 2011 Seeing Machines completed the most significant Production License deal for faceAPI to date with Shenzhen Super Perfect Optics Limited (SuperD).  SuperD is a leading glasses-free 3D solution provider and the agreement with SuperD will see Seeing Machines receive a royalty for every laptop computer, computer monitor or all-in-one-PC product that contains the SuperD glasses -free 3D display solution incorporating faceAPI.  SuperD expects its technology will be used to power millions of devices and this deal propels the faceAPI product into consumer-scale license volumes.  In June Seeing Machines achieved its first royalties under this agreement.

In August 2011 Toshiba released their Qosmio F750 laptop the world's first glasses-free 3D laptop. 

A further faceAPI Production License with English company Claro Interfaces Ltd was announced in April 2011.  This agreement will see faceAPI powering Claro's FaceMouse product enabling users to interact with their computers using head movements.  Seeing Machines will receive a license fee based on the number of Claro FaceMouse products sold. 

The Directors are confident that faceAPI revenue will grow significantly during 2012 through both current and new licensing agreements.

faceLAB®

faceLAB® achieved sales of A$2,239,588 (2010:A$2,612,874).  This contraction in revenue was expected prior to the release of a new R&D technology based on the Company's latest eye and gaze tracking technology.

The partnership with Eye Tracking Inc., whose EyeWorks product, a highly optimised and advanced faceLAB data analysis environment, is integrated with and offered alongside our faceLAB product suite continues to be instrumental in securing a number of sales. This partnership will continue through the development and release of our new R&D product. 

During 2011 the following customers purchased faceLAB systems:

·    Boeing

·    Bristol Robotic Laboratories

·    Texas Transportation Institute

·    Federal Aviation Administration

·    Jaguar Land Rover

·    Honda R&D Americas

·    Toyota

·    Thales Australia Air Systems

·    San Diego State University

TrueField Analyzer®

The Company's focus has been to support the work of the University's Research School of Biology to resolve issues with the TFA's stimulus delivery mechanism which is preventing commercialisation of the TFA. 

Throughout the later part of the year there has been a number of improvements which will shortly be the subject of both a small scale and large scale clinical trial.  Should these trials validate the expected performance of the device then it is likely that the commercialisation program would commence in the first half of the 2012 calendar year. 

It has already been confirmed that the TFA will be able to be used not only for Glaucoma but also for Aged Macular Degeneration (AMD) and diabetic retinopathy (DR).

Chief Executive Officer

The Company's Chief Executive Officer for the full financial year to 30 June 2011 was Dr Nicholas Cerneaz.  Dr Cerneaz completed his contract on 1 July 2011 and Ken Kroeger joined the Company as CEO from 4 July 2011. 

Staff

At 30 June 2011 the Group had 36 full-time employees (up from 29 employees at 30 June 2010).  These additional employees include DSS sales and customer support staff.

Outlook

2011 has been a period of considerable investment for Seeing Machines as the Company moves forward with its strategy of commercialising its products and technology. During the period Seeing Machines has expanded its sales teams, improved its technology and further developed its service offerings.

As a result, the Company is witnessing an increasing number of opportunities and this in turn is leading to an improving pipeline. As such, Seeing Machines is confident of continued revenue growth in 2012 along with an improved financial performance.

William Mobbs                                                                                                                                                               Rob Sale

Chairman                                                                                       Deputy Chairman

Statement of Financial Position

			Consolidated
			2011	2010
AS AT 30 JUNE 2011			A$	A$
ASSETS
CURRENT ASSETS
Cash and cash equivalents			1,648,786	3,904,954
Trade and other receivables			1,555,275	1,316,435
Inventories			332,152	329,062
Other current assets			199,341	30,839
TOTAL CURRENT ASSETS			3,735,554	5,581,290
NON-CURRENT ASSETS
Property, plant and equipment			358,900	227,035
Intangible assets			467,582	477,652
TOTAL NON-CURRENT ASSETS			826,482	704,687
TOTAL ASSETS			4,562,036	6,285,977
LIABILITIES
CURRENT LIABILITIES
Trade and other payables			1,325,671	1,033,059
Provisions			402,129	317,175
TOTAL CURRENT LIABILITIES			1,727,800	1,350,234
NON-CURRENT LIABILITIES
Provisions Non-Current			159,754	101,554
TOTAL NON-CURRENT LIABILITIES			159,754	101,554
TOTAL LIABILITIES			1,887,554	1,451,788
NET ASSETS			2,674,482	4,834,189
EQUITY
Contributed equity			14,813,612	14,664,487
Accumulated losses			(12,832,383)	(10,657,432)
Other reserves			693,253	827,134
TOTAL EQUITY			2,674,482	4,834,189

Statement of Comprehensive Income

			Consolidated
			2011	2010
FOR THE YEAR ENDED 30 JUNE 2011			A$	A$
Continuing operations
Sale of goods and licence fees			6,504,936	4,066,911
Rendering of services			519,813	178,939
Revenue			7,024,749	4,245,850
Cost of Sales			(2,149,718)	(1,079,835)
Gross Profit			4,875,031	3,166,015
Other income			137,189	223,182
Research and Development Expenses			(2,626,651)	(1,567,704)
Distribution Expenses			(319,162)	(520,327)
Marketing expenses			(1,298,740)	(1,316,390)
Occupancy and facilities expenses			(679,566)	(505,764)
Administration expenses			(1,820,974)	(1,182,612)
Other expenses			(442,078)	(66,239)
Profit / (Loss) from continuing operations before income tax			(2,174,951)	(1,769,839)
Income tax expense			-	-
Loss from continuing operations after income tax			(2,174,951)	(1,769,839)
Net Profit / (Loss) for the year			(2,174,951)	(1,769,839)
Other comprehensive income
Foreign currency translation			(1,911)	4,637
Other comprehensive income net of tax			(1,911)	4,637
Total comprehensive income			(2,176,862)	(1,765,202)
Earnings per share for profit attributable to the ordinary
equity holders of the company:
·        Basic earnings per share			(0.532)	(0.531)
·        Diluted earnings per share			(0.532)	(0.531)

 

 

Statement of Changes in Equity

			Contributed Equity	Accumulated Losses	Foreign Currency Translation	Employee Equity Benefits Reserve	Total Equity
FOR THE YEAR ENDED 30 JUNE 2011			A$	A$	A$	A$	A$
At 1 July 2009			9,646,776	(8,887,593)	42,268	738,322	1,539,783
Loss for the year			-	(1,769,839)	-	-	(1,769,839)
Other comprehensive income net of tax			-	-	4,637	-	4,637
Total comprehensive income			-	(1,769,839)	4,637	-	(1,765,202)
Transaction with owner in their capacity as owner
Share based payment			-	-	-	41,897	41,897
Share issue			5,417,255				5,417,255
Transaction costs on share issue			(399,544)				(399,544)
At 30 June 2010			14,664,487	(10,657,432)	46,905	780,229	4,834,189
At 1 July 2010			14,664,487	(10,657,432)	46,905	780,229	4,834,189
Loss for the year				(2,174,951)			(2,174,951)
Other comprehensive income			-	-	(1,911)	-	(1,911)
Total comprehensive income			-	(2,174,951)	(1,911)	-	(2,176,862)
Transaction with owner in their capacity as owner
Share based payment						(131,970)	(131,970)
Share issue			149,125				149,125
Transaction costs on share issue							-
At 30 June 2011			14,813,612	(12,832,383)	44,994	648,259	2,674,482

Statement of Cash Flows

					Consolidated
					2011		2010
	FOR THE YEAR ENDED 30 JUNE 2011				A$		A$
	Cash flows from operating activities
	Receipts from customers				6,737,913		3,732,180
	Grants received				49,125		29,898
	Payment to suppliers and employees				(8,864,926)		(5,469,424)
	Interest received				88,064		26,213
	Net cash flows (used in) / from operating activities				(1,989,824)		(1,681,133)
	Cash flows from investing activities
	Proceeds from sale of plant and equipment				-		-
	Purchase of plant and equipment				(235,428)		(16,173)
	Payments for intangible assets				(30,916)		(94,617)
	Net cash flows (used in) investing activities				(266,344)		(110,790)
	Cash flows from financing activities
	Proceeds from issue of shares				-		5,417,255
	Costs of capital raising				-		(399,544)
	Net cash flows from financing activities				-		5,017,711
	Net (decrease)/increasein cash and cash equivalents				(2,256,168)		3,225,788
	Cash and cash equivalents at beginning of period				3,904,954		679,166
	Cash and cash equivalents at end of period				1,648,786		3,904,954

 

END

 

 

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