Spectur reaps rewards of FY23 investment, targets profitability

Spectur Limited (ASX: SP3), a company that develops AI-enabled tech aimed at improving security, surveillance, safety and productivity, recently released its Q4 FY23 activities report (quarter ending 30 June 2023) citing increased revenue from the year’s expansion initiatives and reiterated a profit-focussed strategy for FY24.

Spectur Limited (ASX: SP3), a company that develops AI-enabled tech aimed at improving security, surveillance, safety and productivity, recently released its Q4 FY23 activities report (quarter ending 30 June 2023) citing increased revenue from the year’s expansion initiatives and reiterated a profit-focussed strategy for FY24.

The company’s outdoor ‘sensing, thinking and acting’ solutions and platforms are contracted to some of the largest government and institutional clients in Australia, including the Department of Planning, Lands and Heritage (DPLHWA), SingTel (Optus) and Surf Life Saving.

Including the part year contributions from 3 Crowns Technologies Pty Ltd (3CT, acquired in February) and Spectur New Zealand (final 49% acquisition completed in March), Spectur Group’s FY23 revenue tallied to $7.438 million, up 31% on FY22.

3CT is a provider of environmental monitoring and AI solutions including smart video surveillance, smart city solutions, ports and waterways management and disaster management. According to Spectur, the acquisition of 3CT has helped the business increase its dominant footprint across Australian beaches.

 

Image: Spectur Limited

June 2023 total sales of $642k marked the highest sales month of the financial year and the third largest month of sales in Spectur’s history.

Full year sales for Spectur and Spectur NZ totalled more than $4.7 million, representing a 14% increase on FY22’s sales results.

Spectur’s net cash usage was just $95k for the quarter, the majority of which was related to investment activities. Pleasingly, net cash used in operating activities was only $6k for the quarter. The Group’s cash balance at 30th June 2023 was $1.523 million.

‘Excellent start’ to FY24

As at 21st July 2023, the company’s month-to-date sales reached $462k, marking an ‘excellent start’ to the company’s new financial year. In addition to these sales, 3CT also successfully closed $282k of long-term contract renewals as of 21 July 2023 across multiple customers.

“We believe we are at a turning point,” Spectur Managing Director Dr Gerard Dyson said.

“An overhead budget smaller than the prior year, a substantial improvement in gross margins built off the back of improved technology and reduced 3rd party costs, and a growing order book underpin a very different FY24.”

Join a live online briefing with Dr Gerard Dyson on Tuesday 8th August at 1pm (AEST). Click here to register or request a recording.

FY23 strategy scorecard and sales forecasts

Spectur raised capital in July and August 2022 to fund the execution of a growth plan, including the acquisitions of 3CT and Spectur NZ, which helped the business achieve key milestones.

Expanding its reseller market, establishing a full-time South Australian presence and increasing its depth of sales expertise and marketing with a key recruit; as well as researching and visiting the US to investigate market opportunities were some of the company’s achievements over FY23.

In the reseller space, Spectur provides a fully integrated and proven solution for its customers to purchase, manage and deploy the product independent of the Spectur support team.

Along with executing a series of debt reduction, productivity, cost control and operational improvements, the company believes it has positioned itself with a scalable platform for further growth, improved margins and reduced overhead costs.

Spectur launched STA-Power, a modular solar-battery solution designed to power Spectur’s, as well as third party platforms. The company expects an increase in revenues from this space in Q1 FY24.

“The always-iconic Spectur hardware has taken a large step forward on the back of careful industrial design to improve functionality, reduce cost to build and support, and substantially improve our physical brand presence,” Dr Dyson said.

The company also recently became a preferred supplier on the Western Australian Local

Government Association’s ‘Information and Communication Technologies’ panel for a scope of services including CCTV, hardware, systems and networks. Participation in this panel provides Spectur with a faster and easier way to embed its solutions within WA councils.

Subject to agreements on final terms, Spectur also has written approval for ‘Local Buy’ programs in Queensland, Northern Territory and Tasmania. The program aims to streamline procurement processes, provide extensive pre-approved supplier lists and ongoing support for local governments.

Spectur’s strategy for FY24 and beyond

Backed by investments in the foundations built in FY23 and the previous years, Spectur‘s strategy is firmly focused on achieving consistent profitability and self-sustaining cash flow.

The company intends to leverage the aforementioned investments to demonstrate the long-term operational viability of Spectur’s current ecosystem prior to expanding into new markets, such as the US, and other strategic initiatives.

Spectur has identified key themes consistent with its strategy, some of which include: prioritising its reseller initiatives while maintaining focus on construction, government and utilities sectors; and driving integrated Spectur and 3CT solutions and an integrated technology stack for both business arms.

“The Board and Executive of Spectur are excited about delivering a strategy focussed on execution and incremental improvement to drive to profitability as a key milestone in our growth story,” Dr Dyson said.

Spectur MD Gerard Dyson will be holding an investor briefing on Tuesday 8th August at 1pm (AEST), where he will discuss the quarterly, the company’s progress and plans for the future. Click here to register or request a recording.

Reach Corporate provides Corporate Advisory Services, including managing investor communications on behalf of Spectur Limited and will receive fees for its services.

Past performance is not a reliable indicator of future performance.

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