Letter to Shareholders 29/12/23

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0	Column 1 0 Column 1 0 Column 1 0 Dear ShareholderSpacetalk Limited (ASX:SPA) is pleased to present you with our highlights for the 2023 calendar year.It has been a period of significant change for your company, At the start of the year, Spacetalk was predominantly a child’s wearables business. By year’s end, it has transformed into a wearables-enabled software subscription and Mobile Virtual Network Operator (MVNO) business.The ‘new’ Spacetalk is now leveraged to the key thematic of keeping all family members - especially the more vulnerable younger and older loved ones - safe and out of harm’s way.This transformation process has enhanced the sustainability of Spacetalk’s business operations, with significant improvement in a host of financial metrics reported over the second half of calendar 2023. These stronger numbers have your Company on the path towards cash flow breakeven.Operational highlightsSpacetalk significantly revamped its leadership team – both at the board and senior management levels - over the course of calendar 2023. Early February 2023 saw highly-regarded senior executive Simon Crowther (ex-CEO of ASX-listed Nearmap) appointed as the Company’s new Chief Executive Officer and Managing Director. Since his arrival, Spacetalk has selectively hired, with some top operators now on the team who bring expertise in their fields. As these new hires occurred, your Company continued to manage its cost base.The year also saw Spacetalk make a conscious decision to focus on achieving profitable growth in its target Australia and NZ markets. This initiative does not however mean that your Company sees little scope for expansion into other geographies. The Spacetalk leadership team is now constructing a runway to deliver controlled international expansion further down the track.Indicative of Spacetalk’s building momentum, the Company reported a pleasing September 2023 quarter. The period saw a 35% uplift in annual recurring revenues, headed by Spacetalk Mobile subscriptions. Revenue from continuing operations surged by 100% to $3.6m.Some of the other key strategic and operational highlights of the year include: A revamped strategy was announced in May 2023. It was premised on: An increased focus on subscription revenue, reshaping Spacetalk into a software-led, hardware-enabled business Delivery of an improved retail margin performance in the Australia/NZ business An increased emphasis on value-add features and promotions New product launches across the family life cycle. The launch of the Adventurer 2 all-in-one smartwatch, phone and GPS safety device for children aged 5-12; key channel partners were also engaged. The successful restructuring of Spacetalk’s loan facilities with Pure Asset Management, with covenants favourably amended. Commitments secured for a single tranche Placement of $0.76 million to professional and sophisticated investors in August 2023; Spacetalk also set in motion a partially underwritten non-renounceable Rights Issue to provide extra funding for its growth initiatives. The launch of a mobile first family safety and tracking Family App, targeting the older tween and teens market segments. The app represented another milestone in Spacetalk’s plans to create an ecosystem of products that provide safety and peace of mind to their users. The release of the Loop 4G and GPS smartwatch, with its features including phone calling capability, SMS messaging, location tracking, a parent-approved contacts list, the ability to create safe zones & alerts, and a distraction free school mode The signing of a partnership agreement with New Zealand-based retailer, The Warehouse Group NZ. It sees the Spacetalk Adventurer 2 and Spacetalk Loop smartwatches offered in the retailer’s large network of Noel Leeming and The Warehouse Stores (around 150-strong). An expansion of Spacetalk’s Mobile Virtual Network Operator (MVNO) offering to service the whole family with a full range of plans suitable for Spacetalk wearables, as well as its 4G and 5G handsets. Looking ahead, your Company remains committed to its stated goal of achieving $20-25m in annual recurring revenues within 3 years and setting in motion a measured move into overseas markets.Media HighlightsSpacetalk inks retail deal with The Warehouse Group – Reseller News 8 December 2023Spacetalk (ASX: SPA) Lifts Revenue Growth In Q1 FY2024 – A Rich Life 20 October 2023Closing Bell: Local markets ignore the conflict, follow the money to a fifth day of wins – * 11 October 2023Spacetalk (ASX: SPA) taps investors for $760k – The Market Herald 24 August 2023Spacetalk revenue up 33% to $8.3m for FY2023 – iTWire 28 August 2023Spacetalk (SPA:ASX) launches Adventurer 2 all-in-one smartwatch – The Market Herald 22 May 2023Spacetalk (ASX:SPA) shares soar with appointment of Simon Crowther as CEO and Managing Director – The Market Herald 2 February 2023Digital HighlightsHow to pair a Loop smartwatch to your phone – December 2023Introducing Spacetalk Loop - Closer. Together. – December 2023How to insert a SIM card into your Adventurer 2 – December 2023How to pair your Adventurer 2 to your phone – December 2023Adventure Calling! - Spacetalk Adventurer 2 – November 2023Introducing Spacetalk Loop - Kids Smartwatch - Voice Calling & Location Tracking – December 2023How to insert a SIM card into a Spacetalk Adventurer– August 2023Introducing Spacetalk Mobile – September 2023How to pair a Spacetalk Adventurer – September 2023Locate. Connect. Protect. - Spacetalk Adventurer 2 – August 2023Introducing Spacetalk Adventurer 2 – August 2023 Thank you for your continued support of Spacetalk Limited. Column 1 0	We invite you to keep track of our progress on our website

Spacetalk Limited (ASX: SPA)Simon CrowtherCEO and Managing Director Tel: 1300 087 423 Investor RelationsThe Capital Network Julia Maguire+61 2 8999 3699[email protected][/table][/table][/table][/table]

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0	Column 1 0 Column 1 0 Column 1 0 Investor ContactComputershare Investor Services Pty LtdLevel 5,115 Grenfell StreetAdelaide SA 5000 Australia[email protected]1300 556 161	+61 3 9415 4000 (International)

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