Ann: HTG Trading Update, page-2

Sounds like HTG management are working hard to increase revenues & to reduce costs - with some further progress having been made, but with no massive revenue increases just yet

See some details of the announcement below:

HTG TRADING UPDATE HIGHLIGHTS:

• Continued momentum in demand for Infinity products with increasing monthly recurring revenue and high-volume sales pipeline for Infinity products
• Resilient balance sheet and reduced monthly cash burn rate
• Expansion of global presence into the United Kingdom, Europe, Middle East, and Africa (EMEA) during June quarter
• Signed a reseller agreement with RSM Australia, a 100-year-old professional services company promoting technology that improves efficiency and sustainability, and reduces costs, to its customers across a range of industries and government
• Harvest and Inmarsat Aviation delivered a new innovative solution for Beyond Visual Line of Sight (BVLOS) operations for small commercially deployed Unmanned Aerial Vehicles (UAVs) livestreaming high-quality video at less than 100kbps
• Harvest and Cisco in transition process from proof-of-concept to operational deployment July 12, 2022:

Harvest Technology Group Limited (ASX:HTG) (Company, Harvest, Group), a global leader in network optimised remote operations, is pleased to provide this trading update to the market.

TRADING PERFORMANCE For the June 2022 quarter, the Company recorded an increase of more than 16% in monthly recurring revenue (MRR) when compared to the March 2022 quarter.

Invoiced sales for the June month exceeded $319k. Infinity invoiced sales for June were $292k.

This followed an increase of over 49% delivered in the March quarter and demonstrates the continued momentum in demand for the Company’s products and services consistent with the Group’s Phase 2 strategy to diversify income streams and expand customer base globally.

The Company reported a June Group MRR of $257k. Infinity MRR for June was $232k.

The June MRR result was impacted by macro and geopolitical instability; client project delays; customers’ choosing to delay purchases until commencement of their FY2023 budget; extended time in conversion of some maritime opportunities due to assets being located offshore for longer periods and made inaccessible for installation; and significant delays to supplies of hardware componentry and casings due to the continuing impact of the COVID pandemic on supply chains.

Whilst economic conditions are expected to remain challenging, the Company is confident of continuing to grow its sales funnel and increase revenue in the coming quarter with new customers and generating growth in existing customer spend, bolstered by investment in regional sales expansion during the June quarter.

Going into FY2023, the Company has an opportunity pipeline at least three times its forecast MRR and total revenue targets and is forecasting a further increase of 32% in Group MRR to between $340k and $380k by the end of the September 2022 quarter.

*Monthly recurring revenue (MRR) represents a blended revenue figure across all products and services sold to customers. Any revenue received in advance is apportioned over the service period.
Invoiced Sales represents the actual revenue billed to customers during the month.

In recent months the Company has taken proactive steps to focus on core areas of its strategy, exercise a disciplined focus on spending and develop an annual budget for the year ahead recognising that capital market conditions and sentiment across the listed technology sector will remain challenging and the expectation that economic conditions will remain volatile.

At the end of June 2022, the Company held cash reserves of $4.5m. It should be noted that this cash position excludes the additional director’s placement proceeds of $1.0m (committed by directors Mr. Marcus Machin and Mr. Paul Guilfoyle) which is anticipated to be paid to the Company post-shareholder approval at the Company AGM in November 2022.

In addition, the Company has recently submitted its annual R&D Tax Claim1 in the first half of FY2023, with the expectation of a conservative cash refund of approximately $750k.

Ongoing gross operating overheads are estimated at approximately $825k per month, excluding revenue contributions. This represents a reduction in current monthly cash burn.

In terms of commercial and operational developments, the June quarter has seen significant progress with the achievement of several important milestones.