Ann: Appendix 4C- June 2021, page-6

This is the reason.

"Increased Inventory
To support the rapid growth in sales, Harris Technology has increased its inventory levels from
$3.3M at June 2020, to $6.6M at March 2021 and $10.4M at June 2021. This increase was
foreseen by the board and was one of the reasons for the April 2021 capital raising. The
increase in inventory used cash of $3.3M in Q3 FY21 and a further $3.8M in Q4 FY21. At the
end of the June 2021 quarter, Harris had cash on hand of $3.262M and the board is confident
that the larger inventory will be required to meet the expected FY22 demand."

The expected increase in demand FY2022 will bring in extra cash.

GLTAH DYOR