Seeing Machines revenue rises, cash outflows narrow

31st Oct 2024 11:14

(Sharecast News) - Seeing Machines reported a 17% revenue increase in its year-end results on Thursday, to $67.6m, aligning with market expectations as regulatory momentum fuelled demand for its driver monitoring technology.

The AIM-traded firm said key revenue drivers included a 40% rise in original equipment manufacturer (OEM) royalties to $10.6m, and a 37% increase in OEM non-recurring engineering (NRE) revenue to $9.2m, indicating robust growth potential.

Aftermarket monitoring and hardware revenue also saw significant gains, up by 12% and 30% respectively.

Despite an EBITDA loss of $17.9m, Seeing Machines said it achieved a 76% reduction in cash outflows to $11.9m.

Operationally, the company reported strides in the automotive sector, expanding its cumulative program lifetime value to $392m with new contracts, while cars using its technology on the road grew 104% year-on-year to over 2.2 million units.

Seeing Machines also announced a post-period collaboration with Valeo to pursue joint automotive ventures globally, and began integrating Asaphus Vision - a recent acquisition in Berlin - to enhance its AI and machine learning capabilities.

In the aviation sector, Seeing Machines solidified its partnership with Collins Aerospace, initiating a $2.6m project for fatigue detection solutions, and deepened its relationship with Qantas Airways by developing eye-tracking solutions for flight simulator training.

The aftermarket segment also saw progress, with a new five-year agreement with Caterpillar providing $16.5m in licence fees and expanding opportunities for Seeing Machines' Guardian solution in on-highway and heavy-equipment markets.

Guardian Generation 3 technology, meeting new European GSR regulations, was successfully homologated in collaboration with bus manufacturers, including WrightBus, reflecting strong alignment with rising regulatory standards.

"Despite broader market dynamics in the automotive sector, our business continues to gain momentum and meet expectations on both revenue and cash," said chief executive officer Paul McGlone.

"The group's performance has been supported by favourable regulatory tailwinds as the global market for driver and occupant monitoring systems matures, further boosting demand across all our targeted transport sectors and driving our growth prospects.

"We have delivered double-digit revenue growth, supported by increased high-margin royalty revenue as cars on road with our technology increased 100% compared to the previous 12 months, and an ongoing ramp up of cars in production is anticipated."

McGlone said that, coupled with the broader launch of Guardian Generation 3, expected to deliver significantly higher margins compared to its predecessor, the trend of higher margin growth was set to continue.

"Our focus remains on reducing operating costs, as achieving cash flow break-even is our top priority and we are reaffirming our expectation to achieve a cash flow break-even run rate in the 2025 financial year.

"By delivering efficiencies and a disciplined approach to management, I'm confident that we will be able to successfully navigate increasing geopolitical complexity, to deliver strong medium- and long-term performance.

"The business has had a good start to 2025, and revenue is on track within the consensus range."

At 1046 GMT, shares in Seeing Machines were down 1.78% at 4.32p.

Reporting by Josh White for Sharecast.com.