Portfolio Update

RNS Number : 2002Q

Tern PLC

26 October 2021

 

26 October 2021

Tern Plc

("Tern" or the "Company")

Portfolio Update

Tern Plc (AIM:TERN), the investment company specialising in the Internet of Things ("IoT"), is pleased to provide an update on the recent activities of the Company and its portfolio companies.

Highlights

· Significant business momentum, in line with Tern's previously reported KPIs, has continued across all of Tern's principal portfolio companies in recent months.

· Device Authority launched KeyScaler Edge to address Edge IoT security challenges alongside its second 'Virtual IoT Security Summit' from 12 to 14 October 2021, covering some of the most challenging current cybersecurity IoT issues in the identity and access management (IAM) sector.  With over 1,200 pre-registrations, the summit attracted sponsored support and expert speakers from a significant number of industry leaders.  Microsoft participated in four sessions over the three days, providing key insights into a number of the key issues that Device Authority are solving for their customers.

· In addition to new customer wins and repeat orders, Device Authority have recently entered into further distribution partnerships, including with Trusted Objects, a leading independent player in cybersecurity technologies for embedded systems and cloud device management platforms , and with Titan Automotive Solutions, a leading provider of car connectivity solutions with a global presence .

· The adoption of FundamentalVR's haptics virtual reality simulation solutions has continued to accelerate.  Recent months have seen FundamentalVR trading strongly, with significant new business wins, including FundamentalVR's first urology procedure and a significant win with a company previously using a competitor's product.

· Wyld Networks has continued to make further significant progress following its IPO on the NASDAQ First North Growth Market in Stockholm on 2 July 2021.  It has continued with the commercialisation of Wyld Connect, securing purchase orders and entering into additional partnerships.  Wyld has also recently strengthened its commercial position, with the company's first published international patent applications.

· InVMA has continued to experience strong sales growth for its Industrial IoT connected asset software as a service (SaaS) product, AssetMinder®, with orders being secured with a number of large international customers.  InVMA have also further enhanced their US presence, in particular with the addition of a recently appointed Head of Product based in their Durham, North Carolina, office.

· Talking Medicines continues to establish its recently new to market PatientMetRx® data platform, capitalising on insights from recent market research, run on behalf of Talking Medicines by Kineticos Lifescience Consultancy, that highlights that 82% of pharma industry executives interviewed plan to adopt 'social listening' technology in the next five years, with 23% believing that they will be using it on a daily basis.  68% do not have a technology partner in place to provide this service .  The preparations to establish a US presence for Talking Medicines are also underway to enable closer proximity to target decision makers in 'Big Pharma'.

Commenting Al Sisto, CEO of Tern, said :

"I am very pleased to note the strong momentum that is continuing with all of Tern's portfolio companies and to be able to report their recent successes.  The importance of the IoT continues to accelerate and the adoption of the real world solutions that Tern's portfolio companies are looking to provide is significantly increasing, particularly as the need for many of these solutions has become more urgent in light of the ongoing Covid-19 pandemic.

"We anticipate our portfolio companies making further progress in the coming months, supported by Tern, and I look forward to providing further updates on their development."

Portfolio Update

Device Authority Limited ("DA" or "Device Authority")

Holding: 56.8%

Device Authority,   a global leader in identity and access management ("IAM") for the Internet of Things, has continued its business momentum, particularly that developed over the last 12 months, increasing its annual recurring revenue through its subscription base and its modularised licence platform, KeyScaler.  Device Authority has also continued to innovate and launched its latest major software release, which includes KeyScaler Edge, in October 2021.

KeyScaler Edge

Device Authority launched KeyScaler Edge in October 2021 and DA believes it is the first device identity centric IAM designed to address the complex end-to-end challenges of IoT security lifecycle management at the network edge.  It is a lightweight version of DA's KeyScaler that has been created specifically for network edge nodes, with the ability to register, authenticate, and provision security certificates and tokens to devices in the local network, independent of an available internet connection.  This allows organisations the ability to automate Edge deployments to drive efficiency at IoT scale and meet their compliance and regulatory obligations for private local network deployments, with safety, confidentiality, data theft/privacy, brand reputation, revenue protection being important factors.

Commenting on the launch of KeyScaler Edge, Darron Antill, CEO of Device Authority, said: "We're delighted to bring KeyScaler Edge to the market and help our customers with their IoT edge deployments. Our BETA program has been a success within the healthcare, retail and transport sectors."

Additional Partnerships

In addition to new customer wins, Device Authority have recently entered into further distribution partnerships, including with Trusted Objects, a leading independent player in cybersecurity technologies for embedded systems and cloud device management platforms , and with Titan Automotive Solutions, a leading provider of car connectivity solutions .

IoT security solutions have a requirement to be adapted to manage the constraints associated with connected devices, including limited computing capabilities, power consumption and scalability.  Trusted Objects is developing IoT security solutions to protect IoT devices, including an innovative embedded secure libraries concept for generic microcontrollers.  Device Authority and Trusted Objects have partnered to collaborate around software Root of Trust (RoT) and security lifecycle management for IoT, enabling a robust end-to-end solution to automate security into any application without the need for expensive custom hardware.  This is intended to provide a number of benefits to the customer including:

·     pre-validated software development kits (SDK) to work on generic chipsets and families of devices, providing a reduced cost option for end customers;

·       an option to "retrofit" to existing IoT deployments, enabling customers to increase security on existing devices;

·         enabling customers to meet new and evolving legislation; and

· allowing security lifecycle management into any cloud application.

Further information about DA's partnership with Trusted Objects and the technology is available via the webcast session at Device Authority's recent Virtual IoT Security Summit here .

Device Authority has also recently entered into a partnership with Titan Automotive Solutions ("Titan"), a leading provider of car connectivity solutions.  Device Authority's KeyScaler has been enabled on Titan's cellular modules to enable 'out of the box' vehicle to cloud trust and identity management and data privacy solutions.   This is aimed at solving several digital challenges in the automotive industry, including:

· vehicle digital identity and trust, enabling the secure connecting of vehicle systems to cloud infrastructure;

· vehicle ownership transfer, providing a secure and scalable security solution to meet the needs of ownership transfer for manufacturers, leasing companies, and car rental companies;

· data privacy and compliance, using policy-driven crypto key provisioning and management; and

· secure over-the-air updates and code signing.

The partnerships with Trusted Objects and Titan Automotive Solutions are in addition to Device Authority's existing partnerships with leading IoT ecosystem providers, including AWS, DigiCert, Entrust, Ericsson, HID Global, Microsoft, PTC, Thales, Venafi and Wipro, amongst others.

Device Authority Virtual IoT Security Summit

Device Authority held its second 'Virtual IoT Security Summit' from 12 to 14 October 2021, covering some of the most challenging cybersecurity IoT issues in the identity and access management (IAM) sector.  With over 1,200 pre-registrations, the sessions attracted diverse global organisations from the automotive, cybersecurity, financial services, system integrator, healthcare, Industrial Internet of Things (IIoT), insurance and government sectors.  These attendees geographically spanned Europe, the USA and the Asia-Pacific regions, reflecting the breadth of international interest in IoT cybersecurity.

The summit attracted sponsored support from industry leaders Venafi / Jetstack, BSI, KORE and Jitsuin, and expert speakers from Microsoft, KORE Wireless, Venafi, Jetstack, Jitsuin, BSI, Intel Corporation, Imagination Technologies, InVMA Limited and Armored Things, amongst others.  Microsoft participated in four sessions over the three days, providing key insights into a number of the key challenges that Device Authority are solving for their customers.

All of the Virtual IoT Security Summit sessions can be viewed on-demand across each of the three days at:  October 12 - Device Authority (brighttalk.live)

FVRVS Limited ("FundamentalVR")

Holding: 26.9%

FundamentalVR delivers virtual reality ("VR") haptic 'flight simulators' for surgery creating a safe, measurable and repeatable space to refine skills.  FundamentalVR's goal is to transform the way surgeons prepare, practice, and refine their skills.  It has built an immersive, surgical simulation application platform, Fundamental Surgery, to provide medical professionals with the opportunity to rehearse, practice, and test themselves within a safe, controllable space that is as close to real-life as possible.

As previously announced, the adoption of FundamentalVR's haptics virtual reality simulation solutions, as a credible alternative to in-person and on human learning, has accelerated as a result of the challenges of social distancing and the reduction in elective surgeries as a result of the Covid-19 pandemic.  Recent months have seen this trend continue, with FundamentalVR trading strongly, with significant new business wins.  Approximately 60% of the business won in recent months has come from new customers with the remainder being repeat sales to its existing customer base.

New business wins include FundamentalVR's first urology procedure and a significant win with a company previously using a competitor's product.  The business is maintaining its focus on the strategic areas of the market where they see high growth potential, in particular ophthalmology, interventional, robotics and regenerative, and where their platform is most differentiated.  The sales and marketing efforts are making steady progress within all these areas.

Validation work with partners is starting to be published, with New York University Langone issuing a validation study in September 2021 highlighting the improved skills transfer of FundamentalVR's HapticVR service over normal VR.  This is backed up by a smaller study by the NHS and a second study that is expected to be published later this year.

InVMA Limited ("InVMA")

Holding: 50%

InVMA has continued to experience strong sales growth for its Industrial IoT connected asset software as a service (SaaS) product, AssetMinder® in recent months, with orders being secured with a number of large international customers who are looking to connect their assets to AssetMinder®, particularly as the Covid-19 crisis has accelerated the need for contactless monitoring of factory and remote assets.  InVMA has a strong sales pipeline and it is continuing to build its recurring revenue base.

InVMA have also further enhanced their US presence, AssetMinder USA, in particular with the addition of a recently appointed Head of Product based in the Durham, North Carolina, office.

Wyld Networks AB (publ) ("Wyld Networks" or "Wyld")

Holding: 60.7%

Wyld Networks has continued to make further significant progress following its IPO on the NASDAQ First North Growth Market in Stockholm on 2 July 2021.  In particular, it has continued with the commercialisation of Wyld Connect, its hybrid satellite terrestrial low-power wide-area network (LPWAN) IoT solution, securing purchase orders and entering into additional partnerships.  Wyld has also recently strengthened its commercial position with the company's first published international patent applications.

Recent purchase orders

In September 2021, Wyld Networks signed a contract with Eutelsat S.A ("Eutelsat"), one of the world's leading satellite operators, worth SEK 900,000 (approximately £76,000) to deliver five satellite IoT test terminals.  Eutelsat's fleet of Low Earth Orbiting (LEO) satellites, called ELO (Eutelsat LEO for Objects), will offer global IoT coverage enabling sensors to transmit data, irrespective of their location, demonstrating the fundamental complementarity between terrestrial networks and satellite technology.  The five satellite test terminals that will be delivered by Wyld in Q4 2021 support both satellite LPWAN and terrestrial LPWAN connectivity as part of the test phase of the Eutelsat ELO programme.

Additionally in September 2021, Wyld Networks announced that it had signed a contract with Bayer Crop Science, a world leader in agriculture and part of the multinational Bayer Corporation.  Bayer placed an initial purchase order worth SEK 320,000 (approximately £27,000) with Wyld Networks to develop a satellite IoT terminal and sensor to collect data from beehives.

Further Partnerships

As satellite IoT adoption accelerates, particularly in the 85% of the world's surface where there is no cellular coverage, Wyld Networks has continued to build out its partnership network recently signing agreements with Chevron Corporation, the multinational energy company, AgroCognitive, a South America based smart precision agriculture platform for sustainable, efficient and profitable food production and KWS, a leading seed specialist providing innovative solutions for farmers around the globe, to implement Wyld Connect, its LPWAN satellite IoT solution.

Patent and Trademarks

Wyld has also recently strengthened its commercial position with the publication of the company's first international patent applications aimed at protecting Wyld's technology.  In its strategic efforts to protect its intellectual property assets and long-term value, Wyld Networks has also secured key trademarks associated with the Wyld brand and products.

The published patent application, titled 'Systems and methods for establishing and operating a resilient and low-latency outband overlay communications network', concerns Wyld Network's core technology and has been published through the Patent Cooperation Treaty (PCT)*, which covers most of the major industrial countries of the world. (*PCT application number: PCT/EP2021/053561. Publication number: WO2021/160867A1).

The registered trademarks secured are for the names Wyld™, Wyld Mesh™, Wyld Fusion™, and Wyld Connect™.

Commenting, Alastair Williamson, CEO of Wyld Networks, said: "We are very pleased to have got our first international patent application published as well as having secured several key trademarks.  As a growing tech company, our intellectual property is a strategic asset and - alongside the people who make Wyld Networks - our most valuable asset.  Therefore, protecting our know-how and brand is essential.  It gives us competitive edge and it creates and protects long-term value for the company and our shareholders."

Board appointment

On 30 September 2021, Wyld Networks announced the appointment of Henrik Hedelius as a director to strengthen the Wyld board.

Henrik Hedelius, born in 1966, studied Business Administration and Economics at Stockholm University.  He is chairman of the board of FUUD AB (publ) and SASHED AB and a board member of Vembla AB, Bergman & Beving Aktiebolag, Addtech AB and The Cloud Factory AB.  He has previously been a senior advisor at UB Markets, CEO and partner at Hedelius & Berthelius, Head of private M&A at Kaupthing Bank, managing director at Storebrand Investments Sweden, and a project manager at Swedbank Markets.

Talking Medicines Limited ("Talking Medicines")

Holding: 23.4%

Talking Medicines is a data technology company using Artificial Intelligence ("AI"), Natural Language Processing ("NLP") and Machine Learning ("ML") as social listening technologies to give patients a voice.  Talking Medicines uses leading technologies to structure and decode what patients are saying by medicine brand.  They continue to focus on establishing their recently new to market PatientMetRx® data platform capitalising on insights from recent market research.  An independent study run on behalf of Talking Medicines by Kineticos Lifescience Consultancy has reinforced the opportunity for Talking Medicines and PatientMetRx®, indicating that 82% of pharma industry executives interviewed plan to adopt social listening technology in the next five years, with 23% believing that they will be using it on a daily basis.  68% do not have a technology partner in place to provide this service.

Commenting Jo Halliday, CEO of Talking Medicines, said: "COVID-19 has shone a light on the need for pharma to adopt new digital technologies and to use actionable data more effectively.  During the pandemic people have flocked to social media, making less frequent visits to GPs and Consultants, as their medicine regimes have inevitably been impacted.  The good news is that pharma professionals are clearly already thinking about this.  They're prepared to step up their efforts and investments to adopt tech-led forms of social listening that are tailored to the needs of the pharma sector as a means of gathering better patient intelligence and improving brand performance."

Partnership

The PatientMetRx® data platform relies on patient feedback sourced as unstructured text from social platforms to input into Talking Medicines proprietary AI/ML models.  Talking Medicines have partnered with Socialgist to accelerate and scale access to that source data.

Commenting on the partnership: Jay Krall, Chief Product Officer at Socialgist, said: "A decade ago, healthcare providers weren't among the first industries to derive useful insights from public social media.  Now, leading firms like Talking Medicines are helping them achieve a new understanding of the patient experience.  We're proud to partner with them to increase signal for analysts and researchers, while ensuring privacy protection."

Sales pipeline

Talking Medicines offers pharmaceutical marketeers a transformative way to access their patient voice by medicine type.  Talking Medicines are focusing on building their sales pipeline on the World's top 20 pharma companies, with showcases such as the 'Bristol Myers Squibb Global Innovation Week Request For Solution' being used.   The preparations to establish a US presence for Talking Medicines are also underway to enable closer proximity to target the decision makers in 'Big Pharma'.

Enquiries

Tern Plc Al Sisto (CEO) Sarah Payne (CFO)	via IFC Advisory
Allenby Capital Limited (Nominated Adviser and Broker) David Worlidge / Alex Brearley (Corporate Finance) Matt Butlin / Kelly Gardiner (Sales and Corporate Broking)	Tel: [phone]
IFC Advisory (Financial PR and IR) Tim Metcalfe Graham Herring Florence Chandler	Tel: [phone] [e-mail]

 

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