IT Player, Dragontail Systems releases Q1 FY2019 results

Dragontail Systems Limited (ASX: DTS) is a company that forms a part of the IT sector and is in the business of optimising restaurant operations. On 16th April 2019, Dragontail Systems Limited provided its quarterly review for Q1 FY2019.

During the month of February and March 2019, the company reported an increase in its global installation rate. With these increased installation rates, the company is well on track to reach its installation targets. Also, the company has a strong inventory of stores, where the company’s products are installed across leading global QSR brands, thus providing a solid base towards the company’s growth. Meanwhile, the company will continue to explore new opportunities in its pipeline.

For the Q1 FY2019 ended on 31 March 2019, the cash receipts from the customers were higher by over $400k (275% of last quarter’s amount); expenses reduced by more than $500k as compared to the last quarter. The cash used during the period reflects the investment made by the company to strengthen its team, developing additional related technology, followed by expanding its relationship with the leading global QSR companies.

The company expects that it will receive a grant for research and development of over A$500k with respect to FY2018.

The Q1 FY2019 reported an impressive installation expansion. The company was able to reach a rate of over 300 locations in a single month. The group also hit a new record, whereby it was able to complete 32 installations in a single day of its flagship products ALGO Dispatching Platform and the Artificial Intelligence QT Camera.

The company also highlighted that since the end of March 2019, the installations had exceeded 1,000 stores. The installation numbers showed that the company is in line with its Q2 target.

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The group also clarified in the announcement that the roll-out of the ALGO platform across the Pizza Hut stores in Australia has started and is expected to be completed by the end of the year ‘19. During 2019, the company has plans to roll-out the platform in more than 280 Pizza Hut store across the country.

After working closely with the USPTO, on 9 April 2019, the company was granted the patent rights for its QT Quality Control Camera in the USA. This is an indication that the company is leading the way with its unique and innovative AI technology.

During the period, the company’s net cash outflow from operating activities stood at US$1.327 million. The primary source of cash outflow was through the payment made for the research and development, product manufacturing and operating costs, staff cost along with the administrative and corporate costs.

By the end of the period, the company had net cash and cash equivalents worth US$2.437 million.

In the previous six months, the shares of DTS has given a negative return of 18.37%. However, in the last three months, the stock has generated a positive return of 17.65%.

At the end of the trading session on 16th April 2019, the stock of DTS was trading at A$0.200, down by 4.762% as compared to its previous closing price. Today, 17 April, the stock is trading at A$0.190, down by 5% (as at 01:45 PM AEST). DTS has a market capitalisation of A$49.6 million and 248 million outstanding shares.


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