25 sep 25   seeing machines ltd - fy2025 results and annual financial report seeing machines limited | see | 2.5 0 0.0% | mkt cap: 123.5m    rns number : 7899a seeing machines limited 25 september 2025   seeing machines limited ("seeing machines" or the "company")   25 september 2025 fy2025 year end results   eu general safety regulation: mandatory camera-based dms in all new vehicles begins in nine months, driving significant growth for seeing machines   seeing machines limited (aim: see), the advanced computer vision technology company that designs ai-powered operator monitoring systems to improve transport safety, has published its audited financial results for the year ended 30 june 2025 ("fy2025" or "the period").   paul mcglone, ceo of seeing machines, commented: "we are now seeing the expected quarterly increase in automotive royalty volumes as the implementation of the european general safety regulation, which mandates camera-based driver monitoring systems (dms) for all new vehicles across europe, comes into force in nine months' time. as the july 2026 deadline approaches, increasing fitment rates will drive a substantial uplift in royalty volumes. our oem customers are forecast to sell around 12.5 million new cars in europe in 2026, all of which will require dms technology post deadline. therefore, as seeing machines expects to supply a large portion of this technology, this quarterly growth is expected to continue in the current quarter and beyond.   "in the aftermarket sector, we have begun converting trial customers into confirmed sales, and our business pipeline-particularly in those markets offering the greatest opportunities, the americas and emea-is developing strongly. as we continue to progress through customer trials, engage in negotiations, and pursue new brand partnerships in collaboration with mitsubishi across the americas and europe, we are confident that our guardian generation 3 technology is poised for significant growth and market adoption. working with mitsubishi also presents exciting new opportunities in automotive and near-term prospects in adjacent sectors like rail, building management, and factory automation, demonstrating the versatility of our world-leading technology.   "we are on track to reach cashflow break-even run rate at the end of this calendar year and are firmly focused on being cashflow positive in the second half of fy2026 and beyond. our strategic priorities continue to centre on sustainable growth and advancing safety technology innovation to get more people home safely."   financial highlights:   -     revenue us$62.3m[1], ahead of market expectations[2] (fy2024: us$67.6m) -     underlying automotive royalty revenue increased by 35% to us$14.4m (fy2024: us$10.6m) -     aftermarket monitoring revenue increased 9% to us$13.6m (fy2024: us$12.4m) -     aftermarket hardware and installation revenue of us$6.4m (fy2024: us$18.9m) -     cash at 30 june 2025 of us$22.6m (fy2024: us$22.8m) -    adjusted ebitda[3] loss of us$30.1m, with a significant sequential improvement in h2 fy2025 of (us$12.4m) compared with h1 fy2025 of (us$17.7m)   operational highlights:   -     secured landmark £26.2m (us$32.8m) investment as part of partnership with mitsubishi electric mobility corporation ("melmb"), a global leader in the design and manufacture of automotive products and technologies, as well as a collaboration to jointly pursue opportunities in automotive, aftermarket and adjacent markets where mitsubishi has an existing competitive advantage -     strategic reorganisation of the company completed during the year that removed around us$12m in annualised operating cost base, supporting the reduction in average monthly adjusted ebitda loss during h2 fy2025 from us$3.0m to us$2.1m per month, with further improvement anticipated during h1 fy2026   automotive highlights: -     cars on the road with seeing machines' driver and occupant monitoring system (dms/oms) technology increased to 3,730,201 units, representing an increase of 69% from 12 months ago (q4 fy2024: 2,211,422) -     collaboration launched with valeo, a global leader in automotive, and acquisition of asaphus vision gmbh, a highly specialised development group that provides seeing machines with a berlin office and a material boost in ai and machine learning capabilities   aftermarket highlights: -     referral agreements signed with mitsubishi electric automotive america, inc. (meaa) and mitsubishi electric europe b.v. set to accelerate sales of gurdian generation 3 across the americas and europe, delivering encouraging progress, leveraging mitsubishi's deep customer relationships in those regions, the first of which has been signed in the us post period end -     guardian generation 3 now in full production and quarterly guardian hardware sales increased by 120% in q4 fy2025 to 2,536 units (q3 fy2025: 1,151) -     completed us$1.2m transaction with world-leading north american self-driving car company to supply and deploy cutting-edge guardian back-up driver monitoring system (guardian bdms) into a test vehicle fleet for a number of new locations as they continue to expand across new sites in the us -     guardian generation 3 successfully approved for homologation with two commercial bus manufacturers in the uk   current trading and outlook -     current trading in line with expectations -     q1 fy2026 quarterly key performance indicators will be published in early november   results presentation paul mcglone, ceo and martin ive, cfo will provide a live presentation of the fy2025 results via investor meet company today at 10:00 bst.   https://www.investormeetcompany.com/meetings/seeing-machines-fy2025-results-presentation   enquiries:   seeing machines limited +61 2 6103 4700 paul mcglone - ceo sophie nicoll - corporate communications       stifel nicolaus europe limited (nominated adviser and broker) +44 20 7710 7600 alex price fred walsh brough ransom ben good     about seeing machines (aim: see), a global company founded in 2000 and headquartered in australia, is an industry leader in vision-based monitoring technology that enable machines to see, understand and assist people. seeing machines is revolutionizing global transport safety. its technology portfolio of ai algorithms, embedded processing and optics, power products that need to deliver reliable real-time understanding of vehicle operators. the technology spans the critical measurement of where a driver is looking, through to classification of their cognitive state as it applies to accident risk. reliable "driver state" measurement is the end-goal of driver monitoring systems (dms) technology. seeing machines develops dms technology to drive safety for automotive, commercial fleet, off-road and aviation. the company has offices in australia, usa, europe and asia, and supplies technology solutions and services to industry leaders in each market vertical. www.seeingmachines.com     review of operations the group's total adjusted revenue for the financial year (excluding foreign exchange gains and finance income) decreased by 22% and total adjusted ebitda losses reduced by 23% on prior year results.       30 june 2025   30 june 2024   change   change     $'000   $'000   $'000   %                   oem   27,955   26,524   1,431   5% aftermarket   24,814   41,101   (16,287)   (40%) adjusted revenue   52,769   67,625   (14,856)   (22%)       30 june 2025   30 june 2024   change   change     $'000   $'000   $'000   %                   oem   (15,339)   (19,051)   3,712   (19%) aftermarket   (14,712)   (19,832)   5,120   (26%) adjusted ebitda   (30,051)   (38,883)   8,832   (23%)   adjusted revenue and adjusted ebitda are non-ifrs measures but included as important metrics for shareholders understanding of the underlying performance of the business.  adjusted revenue includes adjustments linked to minimum royalty guarantees. adjusted ebitda includes earnings before interest, tax, depreciation, amortisation and adjustments for capitalised development costs, restructuring and acquisition related costs, certain tax items, and revenue adjustments linked to minimum royalty guarantees.  please refer to note 4(b) for a reconciliation of adjusted revenue and adjusted ebitda with their ifrs measures.   oem division   seeing machines' driver and occupant monitoring technology (dms/oms) is now installed in over 3.7 million vehicles across nine automotive production programs. the implementation of europe's general safety regulation, which requires advanced distraction warnings in all new vehicles by july 2026, has contributed to increased adoption by automakers. the number of vehicles on the road using seeing machines' technology has increased by 69% compared to the previous year, with further growth expected as the regulatory deadline approaches. this growth is significant for the company, as it is associated with high-margin royalty revenue.  the integration of asaphus vision gmbh into the company has progressed as planned, with engineering teams collaborating to enhance seeing machines' ai and machine learning capabilities. the acquisition has also resulted in the establishment of a european headquarters in berlin.  collaboration with mitsubishi electric mobility corporation (melmb) is ongoing, with a primary focus on automotive opportunities in japan and a secondary focus on global markets.  the company expects that the general safety regulation will continue to influence current and future projects. programme awards are anticipated in the coming months, enabling automakers to meet the increasing demand for advanced safety technologies, particularly in europe. other regions may also adopt similar standards in the future.       30 june 2025   30 june 2024   change   change     $'000   $'000   $'000   %                   royalties   14,406   10,632   3,774   35% non-recurring engineering   9,383   9,242   141   2% licensing   3,188   6,038   (2,850)   (47%) hardware and installations   978   612   366   60% oem adjusted revenue   27,955   26,524   1,431   5%   oem adjusted ebitda   (15,339)   (19,051)   3,712   (19%)   ●   royalty revenues, derived from the installation of seeing machines' driver monitoring system (dms) technology, remains a high-margin revenue stream. during the year, the group recorded a 36% increase in royalty volumes and a 35% increase in royalty revenue. the introduction of the eu general safety regulation (gsr), which will require advanced driver distraction warning (addw) in all new vehicles sold in europe from july 2026, is expected to further increase adoption of driver monitoring technologies by automotive oems. ●   non-recurring engineering (nre) revenue relates to software development activities undertaken to embed dms technologies into specific oem configurations. the increase in nre revenue for the year reflects contributions from the newly acquired asaphus vision gmbh ($3,454,000), offset by a reduction in activities for some larger programs that were at or near completion by the end of june 2025. nre revenue is typically lower margin and is considered a leading indicator of future royalty revenue. ●   revenue from license fees was earned from exclusive collaboration agreements with magna electronics (exclusivity period ended 30 june 2025) and collins aerospace, reflecting the volume of work undertaken during the year to fulfil those agreements. these agreements are generally unique and one-off in nature, and license fee revenue typically attracts a high margin. ●   adjusted ebitda loss improved by 19% compared to the prior year, primarily due to a higher proportion of high-margin revenue and a decrease in research and development expenditure.   aftermarket division   guardian generation 3 entered full production during the year, with units being trialled by customers in multiple regions, particularly in the americas. in fy2025, global sales of guardian hardware totalled 5,466 units.  referral agreements were established with mitsubishi electric automotive america, inc. and mitsubishi electric europe b.v., supporting guardian generation 3 sales in the americas and europe through mitsubishi's customer networks.  guardian generation 3 received homologation approval from two uk bus manufacturers in preparation for the new european general safety regulation (gsr) requirements for advanced distraction monitoring by july 2026. the product is positioned for adoption by commercial vehicle oems for after-manufacture fitment in europe.  in north america, guardian backup-driver monitoring system (bdms) continues to be used in the development of automated vehicle technology. during the year, a contract valued at $1,135,000 was secured to supply guardian bdms to a major autonomous vehicle company in north america for its test fleet.       30 june 2025   30 june 2024   change   change     $'000   $'000   $'000   %                   driver monitoring   13,563   12,433   1,130   9% hardware and installations   6,435   18,902   (12,467)   (66%) royalties   -   3,463   (3,463)   (100%) licensing   3,478   5,000   (1,522)   (30%) non-recurring engineering / consulting   1,338   1,303   35   3% aftermarket adjusted revenue   24,814   41,101   (16,287)   (40%)   aftermarket adjusted ebitda   (14,712)   (19,832)   5,120   (26%)   ●   driver monitoring revenue represents recurring, high-margin revenue generated from guardian connections. revenue increased by 9% during the year, reflecting an increase in the number of connected units. ●   hardware and installation revenue from the sale and installation of guardian units declined by 66%, primarily due to delays in the production of generation 3 units. as at 30 june 2025, generation 3 units were available to meet current demand and requirements in the global pipeline. ●   royalty revenue agreements with caterpillar were replaced with a new five-year license agreement at the end of june 2024. ●   nre revenue relates to technology development and consulting projects with caterpillar. ●   adjusted ebitda losses improved by 26% for the year, primarily due to a higher mix of high-margin revenue, efficiency in service costs, lower operating costs, and a reduction in research and development expenditure.   gross profit   gross profit increased from $31,525,000 in fy2024 to $39,204,000 in fy2025. the gross profit margin rose from 47% in fy2024 to 63% in fy2025. this increase was primarily due to a change in sales mix, with a higher proportion of revenue from license fees (including royalty revenue) and a lower proportion of lower margin hardware revenue compared to the prior year. service costs for monitoring revenue also decreased compared to the previous year.     expenditure       30 june 2025   30 june 2024   change   change     $'000   $'000   $'000   %                   operations expenses   13,273   14,473   (1,200)   (8%) research and development expenses   26,668   34,549   (7,881)   (23%) customer support and marketing expenses   7,548   8,033   (485)   (6%) general and administration expenses   14,726   15,284   (558)   (4%) net foreign exchange gains/(losses)   (34)   (69)   35   (51%) adjusted operating expenses *   62,181   72,270   (10,089)   (14%) depreciation and amortisation   12,813   8,981   3,832   43% capitalised development costs during the period   (17,058)   (22,868)   5,810   (25%) operating expenses   57,936   58,383   (447)   (1%)   * adjusted operating expenses is a non-ifrs measure but included as an important metric for shareholders understanding of the underlying performance of the business. adjusted operating expenses exclude depreciation and amortisation expense and include capitalised development costs.   adjusted operating expenses decreased primarily due to a reduction in people resources, both directly employed and through outsourced contractor roles. the combined number of full-time equivalent employees and contractors declined from 509 at 30 june 2024 to 393 at 30 june 2025, including the addition of 34 full-time equivalent employees from the acquisition of asaphus in july 2024.  adjusted operating expenses for the year included $2,386,000 (fy2024: $1,489,000) in one-off costs, comprising restructuring expenses of $2,291,000 (fy2024: $1,113,000) and acquisition costs related to asaphus vision gmbh of $95,000 (fy2024: $376,000). excluding these one-off costs, adjusted operating expenses decreased by $10,986,000 (or 16%) compared to the previous financial year.   results for the year   as a result of above factors, the loss for the year ended 30 june 2025 decreased by $6,010,000 to $25,266,000 (fy2024 loss: $31,276,000).   working capital management   after adjusting for the receipts from one-off licensing arrangements, cashflows from operating and investing activities have improved for the year.       30 june 2025   30 june 2024     $'000   $'000           net cash flows from/ (used in) operating activities   (12,310)   12,052 net cash flows used in investing activities   (17,486)   (23,996) net cash flows used in operating and investing activities   (29,796)   (11,944)           less: cash from one-off licensing arrangements   (3,750)   (25,250) adjusted cashflows *   (33,546)   (37,194)   * adjusted cashflows is a non-ifrs measure but included as an important metric for shareholders understanding of the underlying performance of the business. adjusted cashflows excludes cash from one-off licensing arrangements   excluding cash received from one-off licensing arrangements, operating cashflows declined by $2,862,000 during the year. this decline was primarily attributable to significant payments for inventories, including payments made to close out remaining generation 2 units sold in the prior year and payments for new generation 3 units to support current demand and the global pipeline.  the reduction in development costs capitalised as intangible assets contributed to a favourable movement in cashflows from investing activities.   industry update  driver monitoring system (dms) technology adoption driven by regulatory developments the european union continues to implement regulations that support the adoption of driver monitoring system (dms) technologies. under the general safety regulation (gsr), all new vehicle types have been required to include driver drowsiness and attention warning (ddaw) systems since july 2022. as of july 2024, this requirement applies to all new vehicles. a further regulation, advanced driver distraction warning (addw), will take effect in july 2026. this regulation mandates systems capable of monitoring driver eye movements to detect distraction, necessitating the use of camera-based dms.  these regulatory measures are intended to reduce road fatalities and improve driver safety across the eu. the requirement for camera-based systems is expected to increase the deployment of advanced dms technologies across both the aftermarket and original equipment manufacturer (oem) segments in europe.  in addition, the european new car assessment programme (euro ncap) has introduced incentives for dms adoption by awarding safety points to vehicles equipped with such systems. this has contributed to increased interest from oems seeking to meet top safety rating criteria.  outside of europe, regulatory activity is also progressing. in the united states, the national highway traffic safety administration (nhtsa) has proposed rulemaking that includes dms as a countermeasure for impaired and distracted driving. the proposed roadmap includes phased implementation, beginning with detection of distraction and drowsiness, followed by alcohol impairment monitoring and, ultimately, vehicle-initiated safe stops.  in australia, regulatory focus is increasing, particularly in relation to heavy vehicle safety. meanwhile, china and japan are advancing toward dms mandates, with japanese oems actively working to align with international standards.  the company has contributed to policy development through submissions to nhtsa, the federal aviation administration (faa), and the national transport commission (ntc), and continues to participate in euro ncap's tier 2 working group on occupant state monitoring.   other highlights   the company completed a strategic reorganisation, reducing annualised operating costs by approximately $12 million. as part of this process, john noble was appointed chief technology officer and dr mike lenné was appointed chief safety officer.  a £26,207,000 ($32,751,000) investment was secured through a partnership with mitsubishi electric mobility corporation (melmb).  referral agreements were signed with mitsubishi electric automotive america, inc. (meaa) and mitsubishi electric europe b.v. to support sales of guardian generation 3 across the americas and europe.  a new 3d camera technology for in-cabin monitoring was launched in collaboration with airy3d inc., offering a cost-effective solution for meeting future safety regulations.  a collaboration was initiated with valeo, and the company acquired asaphus vision gmbh, a berlin-based ai and machine learning development group. significant change in state of affairs share capital increased by $31,240,000 (from $240,948,000 to $272,188,000) as a result of the issuance of new shares to mitsubishi electric mobility corporation. the details of the changes in contributed equity are disclosed in note 21 to the financial statements. subsequent events after the balance date no matter or circumstance has arisen since 30 june 2025 that has significantly affected, or may significantly affect the company's operations, the results of those operations, or the company's state of affairs in future financial years.   likely developments and expected results of operations more information on the likely developments and expected results of the operations are included in the review of operations, trading update and other highlights on pages 4 to 8.   environmental regulation the company holds no licenses issued by relevant environmental protection authorities and there have been no known breaches of any environmental regulations.     consolidated statement of financial position as at 30 june 2025                 note   2025 $'000   2024 $'000 assets                           current assets             cash and cash equivalents   9   22,556   22,828 trade and other receivables   10   9,079   25,293 contract assets   11   8,089   7,044 inventories   12   4,614   3,625 other financial assets   13   308   315 other current assets   14   2,611   2,113 total current assets       47,257   61,218               non-current assets             contract assets   11   6,253   -  property, plant and equipment   15   2,634   3,486 right-of-use assets   25   3,014   3,737 intangibles   16   71,621   61,323 other financial assets   13   521   533 total non-current assets       84,043   69,079 total assets       131,300   130,297               liabilities                           current liabilities             trade and other payables   17   10,162   21,161 contract liabilities   19   4,329   5,471 leases   25   1,430   1,122 provisions   18   4,718   4,909 deferred consideration   34   1,177   -  total current liabilities       21,816   32,663               non-current liabilities             contract liabilities   19   7,943   9,088 borrowings   20   51,315   45,701 leases   25   2,856   4,097 deferred tax   6   791   1,423 provisions   18   292   342 deferred consideration   34   3,027   -  total non-current liabilities       66,224   60,651 total liabilities       88,040   93,314               net assets       43,260   36,983 equity             contributed equity   21   272,188   240,948 other equity   22   5,582   5,582 other reserves   23   7,552   7,249 accumulated losses and reserves   23   (242,062)   (216,796)               total equity       43,260   36,983   the above consolidated statement of financial position should be read in conjunction with the accompanying notes  consolidated statement of comprehensive income for the year ended 30 june 2025                 note   2025 $'000   2024 $'000             sale of goods       6,865   18,168 royalty and license fees       30,640   25,133 service revenue       24,832   24,324 revenue   4   62,337   67,625               cost of sales       (23,133)   (36,100) gross profit       39,204   31,525               expenses             operations expenses       (16,749)   (16,600) research and development expenses       (18,947)   (18,535) customer and marketing expenses       (7,548)   (8,033) general and administration expenses       (14,726)   (15,284) net foreign exchange (losses)/gains       34   69 expenses   5   (57,936)   (58,383)               operating loss       (18,732)   (26,858)               finance income       935   411 finance costs   5   (7,981)   (5,757) finance costs - net       (7,046)   (5,346)               loss before income tax benefit       (25,778)   (32,204)               income tax benefit   6   512   928 loss after income tax benefit for the year attributable to the owners of seeing machines limited       (25,266)   (31,276)               other comprehensive income/(loss)                           other comprehensive income/(loss)             exchange differences on translation of foreign operations       2   (26)               other comprehensive income/(loss) for the year, net of tax       2   (26) total comprehensive loss for the year attributable to the owners of seeing machines limited       (25,264)   (31,302)                       cents   cents               loss per share for loss from continuing operations attributable to the owners of seeing machines limited             basic loss per share   8   (0.555)   (0.753) diluted loss per share   8   (0.555)   (0.753)                 the above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes  consolidated statement of changes in equity for the year ended 30 june 2025             contributed   other   accumulated   foreign currency translation   employee equity benefits &   total equity     equity   equity   losses   reserve   other reserve       $'000   $'000   $'000   $'000   $'000   $'000                           balance at 1 july 2023   240,948   5,749   (185,520)   (13,818)   19,172   66,531                           loss after income tax benefit for the year   -   -   (31,276)   -   -   (31,276) other comprehensive loss for the year, net of tax   -   -   -   (26)   -   (26)                           total comprehensive loss for the year   -   -   (31,276)   (26)   -   (31,302)                           transactions with owners in their capacity as owners:                         share-based payments (note 27)   -   -   -   -   1,921   1,921 value of conversion rights on convertible notes   -   (167)   -   -   -   (167) balance at 30 june 2024   240,948   5,582   (216,796)   (13,844)   21,093   36,983       contributed   other   accumulated   foreign currency translation   employee equity benefits &   total equity     equity   equity   losses   reserve   other reserve       $'000   $'000   $'000   $'000   $'000   $'000                           balance at 1 july 2024   240,948   5,582   (216,796)   (13,844)   21,093   36,983                           loss after income tax benefit for the year   -   -   (25,266)   -   -   (25,266) other comprehensive income for the year, net of tax   -   -   -   2   -   2                           total comprehensive income/(loss) for the year   -   -   (25,266)   2   -   (25,264)                                                     transactions with owners in their capacity as owners:                         contributions of equity, net of transaction costs (note 21)   31,240   -   -   -   -   31,240 share-based payments (note 27)   -   -   -   -   301   301 balance at 30 june 2025   272,188   5,582   (242,062)   (13,842)   21,394   43,260     the above consolidated statement of changes in equity should be read in conjunction with the accompanying notes  consolidated statement of cash flows for the year ended 30 june 2025                 note   2025 $'000   2024 $'000 cash flows from operating activities             receipts from customers (inclusive of gst)       60,689   81,634 payments to suppliers and employees (inclusive of gst)       (73,811)   (69,952) interest received       933   411 income taxes paid       (121)   (41) net cash from/(used in) operating activities   24   (12,310)   12,052               cash flows from investing activities             payment for purchase of business, net of cash acquired   34   (62)   -  purchase of property, plant and equipment   15   (235)   (831) payments for intangibles (patents, licenses and trademarks)   16   (131)   (297) payments for intangibles (capitalised development costs)   16   (17,058)   (22,868) net cash used in investing activities       (17,486)   (23,996)               cash flows from financing activities             proceeds from issue of shares   21   32,752   -  share issue transaction costs   21   (1,512)   -  payment of lease liabilities   25   (1,760)   (729) net cash from/(used in) financing activities       29,480   (729)               net decrease in cash and cash equivalents       (316)   (12,673) cash and cash equivalents at the beginning of the financial year       22,828   35,606 effects of exchange rate changes on cash and cash equivalents       44   (105) cash and cash equivalents at the end of the financial year   9   22,556   22,828     the above consolidated statement of cash flows should be read in conjunction with the accompanying notes  [1] reported revenue includes us$10.2m of automotive royalty license revenue as per aasb15: revenue from contracts with customers for guaranteed minimum volume royalty payments from a program that commenced production during fy2025. [2] consensus expectations for fy2025 are for revenue of us$58m, adjusted ebitda of us$(28.9)m. [3] adjusted ebitda reflects earnings before interest, tax, depreciation and amortisation, adjusted to better show the underlying performance of the business. adjustments are made for capitalised r&d, restructuring and acquisition-related costs, certain tax items, and revenue adjustments linked to minimum royalty guarantees. these items are excluded as they are not considered part of the group's normal ongoing operations.   this information is provided by rns, the news service of the london stock exchange. rns is approved by the financial conduct authority to act as a primary information provider in the united kingdom. terms and conditions relating to the use and distribution of this information may apply. for further information, please contact rns@lseg.com or visit www.rns.com.  rns may use your ip address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. for further information about how rns and the london stock exchange use the personal data you provide us, please see our privacy policy.   end   fr uvvsrvrukurr return to news summary

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