Ann: United States Work Zone Speed Tender Update, page-7

This is a blood nose, no doubt about it. Don't tell the market you're the "apparent successful tenderer" unless you are pretty bloody sure that you are. Bad form from the team.

This article is not a bad read:- https://www.businessnewsaustralia.com/articles/acusensus-puts-foot-on-profit-accelerator-as-road-safety-technology-gains-traction.html

Basically:-

a) ACE has relationships with most Australian governments apart from WA. 93% of their revenue is coming from Australia. Presumably the rest coming from the UK. The UK is a patchwork quilt of local police forces acting autonomously so they are not necessarily big contracts. They are forecasting $5 million EBITDA for FY24. Obviously they are trying to grow and so their bottom line is basically breaking even.

b) contrary to what the article says, there was no IPO, it was an institutional capital raising. In any event the company is now trading at a 20% to its cash reserves

c) this is not your usual tech startup with an impressive idea but very little besides. They already had contracts and a market ready product prior to the capital raising.

d) the US tender ended with no one getting a contract. Governments outside Australia are not necessarily keen to introduce these cameras. Even in Australia, they have been unpopular at times. There was an interesting article by Waleed Aly where he opined that Australians were more accepting of authority than other countries:- disallowed/national/carefree-larrikin-is-a-myth-australians-are-obedient-to-authority-20201217-p56oc7.html
Perhaps introducing these cameras is simply too hard a sell for US governments, politically.

e) AI is an inherently competitive space and invariably there will be others throwing their hat into the ring. But like I said, ACE has a significant lead on those other parties.

Will still hold on till the end of FY24 at least, but feeling pretty upset at the company today.