Swift Media : Strong Q1 FY21 Results Quarterly Report and Cash Flow

ASX RELEASE

20 October 2020

ASX: SW1

SWIFT ANNOUNCES STRONG Q1 FY21 RESULTS

4C CASH REPORT AND INVESTOR CALL

Swift Media Ltd ("Swift", "the Company") is pleased to announce today that the strategies to drive improvements in sales, efficiency and new technologies are beginning to deliver encouraging results:

• Revenue1 $5.9m, up 23.4% on Q4 FY20. 70% of group revenue is contracted and recurring.
• 160% EBITDA2 growth vs prior corresponding period
• EBITDA margin of 5% in Q1 FY21 reflects a continuing and positive trend (see chart below)
• Cash used in operations of $0.1m versus $1.5m in the prior quarter. $1.9m in net cash reserves.
• 200% growth in project revenue, won $1.2m of new contracts and delivered $1.8m in Q1 in Mining and Resources
• 100% retention of Mining and Resources customers
• Tender requests up 28% year on year - encouraging lead indicator of sales growth for 2021

EBITDA ($M)

	Q1-FY20	Q2-FY20	Q3-FY20	Q4-FY20	Q1-FY21
0.4																10%
0.2																		5%
-
																0%
(0.2)
																(5%)
(0.4)
(0.6)																(10%)
(0.8)																(15%)
(1.0)						EBITDA					EBITDA Margin %	(20%)

% Margin EBITDA

Pippa Leary noted, "It is encouraging to see that the great efforts we are making to strengthen and streamline Swift are beginning to deliver positive results. Q1 FY21 EBTIDA represents a 160% growth year on year supported by efficiency gains. We remain focused on driving profitable sales, process improvements, enhancements in our delivery to customers, and the development of new product and infrastructure technologies. While there is much more to do, I am pleased to report we have made significant progress on each of these measures in the first quarter."

ASX RELEASE

20 October 2020

ASX: SW1

Q1 FY21 Highlights

• Revenue $5.9m, up 23.4% on Q4 FY20. 70% of group revenue is contracted and recurring. o Strong growth in Mining & Resources' revenue increasing 50% over Q4 FY20, and 30% over the prior corresponding period. 200% growth in project revenue in Mining and Resources this quarter, leads to recurring revenue. 100% retention of Mining and
  Resources customers, with 12 new contracts worth $1.2m in Q1.
  o Revenue in Aged Care down 13% over Q4 FY20, and -10% versus the prior corresponding period, impacted by continued access restrictions during COVID-19 as expected
• Positive EBITDA $0.3m, an increase of $0.8m or 160% versus the prior corresponding period reflecting the benefits of cost rationalisation achieved through FY20
• Strategies to streamline Swift beginning to drive margin expansion as EBITDA margin of 5% in Q1-FY21 reflects a continuing and positive trend
• Operating cash flow improvement: Cash used in operations of $0.1m versus $1.5m used in the prior quarter. Prudent management of cash resources, ending the quarter on $1.9m in net cash reserves.
• Strengthening sales pipeline. Tender requests up 28% year on year - encouraging lead indicator of sales growth for 2021.

Financial highlights (unaudited)

($M)	Q1- FY20	Q4- FY20	Q1- FY21	Vs Q1 FY20	Vs Q4 FY20
Revenue	6.1	4.8	5.9	(3%)	23%
EBITDA	(0.5)	0.2	0.3	160%	50%
EBITDA Margin %	(9%)	4%	5%	+14 pp	+1 pp

Q1 FY21 Business Review

Strong growth in Mining and Resources revenue driven by project work, expected to convert into recurring revenue over time. Flat growth in Aged Care due to COVID-19.

• Sales

1. Mining and Resources: 28% more tenders versus the prior corresponding period o Delivered $1.8m worth of jobs for Atlas Iron, Rio Tinto and Howard Springs
   o Installed Swift Plus for exploration, mobile, rail and road camps
   o Aged Care: Onboarded Swift Plus in 800 rooms across five Aged Care facilities including: Applewood, Rivervue, Adventist Care Rossmoyne Waters, IRT and Andrew Kerr.
   o Health and Wellbeing: New retention strategy has resulted a 100% improvement

ASX RELEASE

20 October 2020

ASX: SW1

• Improvements in process and capabilities

1. Improvement in Delivery and Support functions strengthening relationships and reputation, generating variation work worth $900k in Mining and Resources

• 1. Hired new Chief Financial Officer, Head of Product and project managers
  1. Strengthening reporting capabilities with new Data Analyst
• New technology developments
• 1. My Family My Community app evolution to fit with Swift Plus, allowing simple communication with Aged Care residents

1. Advanced scheduling of notices in Swift Plus

1. Swift Plus for exploration, mobile, rail and road camps in Mining and Resources

• 1. Deep customer research into Mining and Resources sector to evolve product and services
• Operational Cash Flow
• 1. Cash receipts from customers $5.9m, +23% vs Q4 FY20

1. $4.2m cash payments for product, manufacturing and operating costs compares to $3.1m in Q4 FY20 as trade payable balances managed lower.

1. Q1 net cash from operating activities benefited from $0.25m of Jobkeeper funding, lower quarter on quarter staff and administration expenses, and fewer redundancy and restructuring costs.

1. Interest costs increased over the prior quarter as the company's main lending facility payment deferral was reinstated post COVID-19.

1. Lease payments increased over the prior quarter as COVID-19 payment deferrals were reinstated.

Strategic Priorities

ASX RELEASE

20 October 2020

ASX: SW1

BUSINESS UPDATE AND INVESTOR VIDEO CALL

Pippa Leary and Geoff Greenberg invite investors to join them on a video conference call and Q&A session on Wednesday 21st October 2020 at Noon AEDT where they will provide an update on the business.

To join the meeting on a computer or mobile phone please go to this link:

https://bluejeans.com/705131392?src=calendarLink

NB. If you have not used the Blue Jeans Network before, it will ask you to download the app onto your computer or device. Alternatively go to bluejeans.comand join the meeting from your browser by typing in this meeting ID: 705 131 392

Notes:

1. All financial disclosures and references to financial information in this document are based on unaudited results.
2. EBITDA (earnings before interest, income tax expense, depreciation and amortisation) is a financial measure which is not prescribed by Australian Accounting Standards ('AAS') nor International Financial Reporting Standards ('IFRS') and represents the profit/(loss) under AAS/IFRS which has been adjusted to eliminate the effects of tax, depreciation and amortisation, fair value adjustments, impairment expenses, loss on disposal of assets and other one-off items including restructuring costs.
3. A summary of the cash used in operations by the business' significant activities is provided in the following table:

	Swift	Health and	Total
($000, items may not add due to rounding)	Wellbeing
Receipts from customers	5,118	788	5,907
Operating expenditure payments	(5,420)	(557)	(5,977)
Net cash from / (used in) operating activities	(302)	231	(71)

END

ABOUT SWIFT MEDIA LIMITED

Swift Media is a specialist technology company delivering premium entertainment, communications, and advertising to an audience of 5M+ via 60,000 digital assets nationally across Mining and Resources, Residential Aged Care and Health & Wellbeing environments. We connect and engage communities through entertainment and communications solutions.

This announcement was approved and authorised for release by the Continuous Disclosure Committee.

FOR MORE INFORMATION, PLEASE CONTACT:

Pippa Leary	Michael Brown
Chief Executive Officer	Investor Relations
[phone]	[phone]
[e-mail]	[e-mail]