Seeing Machines trading in line as losses narrow

Driver monitoring technology company Seeing Machines reported operational revenue growth of 19.4% on Wednesday, to reach AUD 21.7m (£12.42m) in its first half.

The AIM-traded firm said its underlying revenue growth at constant currency was 24.6% year-on-year for the six months ended 31 December.

Original equipment manufacturer (OEM) revenue in the automotive and aviation sectors totalled AUD 5.2m - up 69% on the prior year, which included a 170% increase in royalty revenue derived from the installation of its driver monitoring system (DMS) technology of AUD 2.1m.

Annual recurring revenue, including royalties, was ahead 9.3% since 30 June to reach AUD 18.8m.

Seeing Machines reported aftermarket revenue from its fleet and off-road customers of AUD 16.4m, up 9% year-on-year, including royalty growth of 16% to AUD 6.7m.

The company narrowed its net loss by 17.8% to AUD 13.8m, with cash at period end on 31 December totalling AUD 79.3m, up from AUD 52.4m a year earlier.

Looking at the rest of the year, Seeing Machines said it was trading within the range of consensus expectations for the 2022 financial year.

The board said there was “considerable accelerating momentum” in the business, with current market conditions presenting a “significant opportunity” to capture a greater market share, as a number of “structural tailwinds” supported application of its technology.

The current active requests-for-quotes (RFQ) pipeline, with programme opportunities exceeding AUD 1bn, underpinned the board's view that Seeing Machines would have an increased market share by 2025.

“These results demonstrate positive momentum across the company,” said chief executive officer Paul McGlone.

“Our automotive business continues to grow with more cars starting production, generating high-margin royalty revenue.

“This is underpinned by our increasing confidence in ongoing RFQ processes as we focus on feature development and integration options to support OEM demands, in partnership with our tier-1 customers.”

McGlone said the aftermarket sector was experiencing similar positive momentum, with growth in the company’s direct business resulting in a more profitable model and a growing sales pipeline through its expanding team.

“There are obviously challenges with the current geopolitical and global inflationary environment and supply chain that affect the market as a whole.

“We are focused on mitigating these risks as they are identified and are confident in our ability to continue to grow the business.”

At 0919 BST, shares in Seeing Machines were down 2.5% at 7.8p.