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Summary
- The ASX-listed Company, SenSen Networks, has reported revenue from ordinary activities of A$3,763,526 backed by a significant 33% y-o-y increment in annual recurring revenue (ARR) for FY20.
- SenSen cash position stood at A$2.46 million at the end of FY20 supported by highest-ever quarterly customer cash receipts of A$1.430 million during the June Quarter.
- With government and blue-chip corporate clients gaining more strength through the year, SenSen projects ARR of ~A$3.5 million and contracted revenues of ~A$5.6 million in FY21.
- SNS has continued to invest in R&D and file additional patents to underpin its technical leadership position in the IoT, AI, and Video Analytic solutions space, globally.
SenSen Networks Ltd (ASX:SNS), an AI solutions provider, revolutionising intelligent transportation systems and gaming sectors, has published its preliminary final report for the period ended 30 June 2020, highlighting FY20 business performance.
SenSen is contributing significantly towards creating a paradigm shift in smart transportation and gaming space. The Company has structured its solutions by integrating both video analytics as well as artificial intelligence data analytics for customers across Intelligent Transport Systems (ITS) and gaming industry in Australia, Canada, Singapore, US, India, New Zealand, Europe, and the UAE.
On that note, let us discuss the key highlights of the preliminary final report for FY20.
Revenue from ordinary activities at A$3.73 million
For FY20, revenue stood at A$3,763,526 including the contribution of A$3,369,139 from Smart Cities and A$394,388 from Retail & Leisure segment.
The FY20 revenues comprised primarily of existing recurring contracted revenue as well as additional orders from SenSen’s Smart City customer base across Australia and overseas, with the major contribution gained in the first half.
Strong progress of annualised recurring revenue (ARR)
SenSen’s top-line performance was underpinned by strengthened annualised recurring revenue (ARR) which surged ~33% y-o-y to ~A$2 million. Significant growth from its government and blue-chip corporate customers drove the growth in ARR. The Company expects an estimated ARR growth of ~75% to ~A$3.5 million in FY21.
ARR would be comprised of contributions from a globally diversified group of numerous blue-chip Smart City clients.
SenSen also expects to receive additional orders for SenGAME 3.0 from its casino customers under the existing arrangements.
Overall contracted revenues of ~ A$5.6 million estimated for FY2021; Profitability eyed
With confirmed overall contracted revenues of ~ A$5.6 Million for FY21, SenSen expects the Company to attain profitability in FY21. Furthermore, additional contract wins and revenue from other sources, comprising increased sales demand for SenSen’s Gemineye offering, is expected in FY21, enhancing further profitability boost.
It is worth noting that amid COVID-19 headwinds, SenSen did not experience any material interruptions or delays in customer deliveries as well as support, demonstrating the Company’s excellent execution capabilities, despite 90% workforce working remotely.
Boosted Cash Position of A$2.46 million
SenSen recorded strong cash and cash equivalents of A$2,462,642, as on 30 June 2020.
The improved cash position (an increase of 25% y-o-y) was on the back of a significant contribution from highest ever quarterly customer cash receipts of A$1.430 million recorded in the June quarter and A$755,000 in the March quarter 2020.
It is worth noting that SenSen achieved strengthened cash position without COVID-19 related government support.
Furthermore, the Company highlighted continuing its prudent cost-cutting measures in FY20 encompassing across-the-board 20% reduction in salaries, and reductions in costs concerning sales, office lease expenses, IT, marketing, and travel.
SenSen expects to achieve a positive operating cash flow outcome in FY21 primarily supported by continued implementation of cost-cutting strategy along with cash flow generated from contracted revenues.
Related: A Lens over Splendid Performance of SenSen Networks in the June Quarter
Continued investment in the R&D pipeline in FY20 and beyond
During FY20, SenSen continued to focus on investment in its R&D pipeline as well as on filing additional patents to consolidate its technical leadership position within the global IoT, AI and Video Analytic solutions space.
Furthermore, numerous patent applications are in the pipeline with significant progress in creating innovative and patentable products and solutions in Smart City and Casino Gaming applications, comprising technology solutions appropriate to COVID-19 related applications, like monitoring of social distancing measures.
R&D with University of Melbourne
SenSen and the University of Melbourne effectively secured a prestigious research grant to develop more accurate and efficient methods to digitise smart city assets from the Australian Research Council (ARC). ARC is providing A$370,000, and SenSen is expected to contribute A$240,000 to aid the three-year collaborative project, with both entities committing additional in-kind resources.
On 3 September 2020, SNS was trading at A$0.090 at 12:38 PM AEST.
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