Ann: Update on PainChek Business Performance, page-117

I think it's really important to start to recognise that the roll out and timing of PainChek is in reality a lot slower than forecast.

Those timings for late 2020 are a target sure, but they will be soft launches and will simply not take off with a bang.

The government grant is an excellent case in point, even from announcement it took eight months to formally begin and start from out.

I think the market reaction to this update is fair. PainChek deserved to be sold into. The October Q had 20k beds signed up with a forecast 22k beds to be added for a total of 42k by December 31. This update with two weeks to go sits at 31500. It's possible they sign up another 10500 before month end, but I think it could be a missed forecast.

I'm not completely happy with the $1.53m ARR. It's not representative of the revenue being earned now. It excludes first year discounts, which I think are quite heavy judging by the averages in the last quarterly. 31500 @1.53m is $4.04/month/bed.

The last quarterly showed $720194 as the ARR from 20616 beds. Whichever way you cut it that's $2.91/month/bed.

So if you're making forecasts on breakeven and funding in to the future you cannot use these values from the last update because they are considerably different to the current actuals. I sincerely hope the company keeps reporting actual numbers as well as contacted numbers for the future so we can see how things are travelling. I really want to see the ARR lift from $2.91/month/bed to prove that the contracted price is higher and we can indeed use that $4 per month as a revenue forecast figure.

50c-$1 forecasts for the SP next year are all valid in my view. I love where the company is heading, I'm just going to try and concentrate on the facts of the here and now and read announcements with careful scrutiny.