Total Brain : September 2021 Quarterly Report (PDF)

For personal use only

29 October 2021

Australian Securities Exchange (ASX) Announcement

September 2021 Quarterly Update and Appendix 4C

Total Brain Limited ("Total Brain," "TTB" or "the Company"), a digital mental health SaaS company, is pleased to report on its activities for the quarter ended 30 September 2021. Key highlights from the quarter are set out below.

• During the quarter, Total Brain announced that its affinity partner IBM has entered into a contract with the first government client of the IBM Health & Wellness 360 platform. TTB supplies the Total Brain platform for use within GRIT, IBM's initial deployment of the Health & Wellness 360 platform, which targets the support of large populations in transition. The initial roll-out is for 25,000 users, which represents A$600k in Annual Recurring Revenue ("ARR") to TTB

1. The contract between IBM and its government client includes provisions for potential deployment up to hundreds of thousands of users over the next 2 years, representing a very significant additional ARR opportunity for Total Brain.

1. GRIT is scheduled to launch in November. It will be promoted by the government agency across their social media handles, web properties, and through a variety of other on- and off- line channels to drive agency members, their families and their caregivers to register for the app. Revenue recognition and cash receipts are expected to commence subsequent to the launch in Q4 CY21, subject to risks of process delays inherent in transactions of this kind

• 1. Following the close of this initial contract through IBM, management has seen increased activity in the joint IBM / TTB pipeline of other opportunities in the government and non- government sectors. Management expects this to accelerate in the coming quarters
• The anticipated transaction for the commercialization of a Direct-to-Consumer (D2C) version of the Total Brain platform continues to progress following partner delays during the quarter. Management continues negotiations with the other side and expect the contract to conclude in the near term
• During the quarter, the Company entered into 6 contracts with small and medium businesses and behavioral health and addiction clinics. In total, they represent A$43k in ARR to the Company
• 1. 5 of these contracts are with clients in the clinical space, representing an estimated 1,150 addressable patients annually. While, these opportunities start at a lower level of ARR, management expects material growth in the size of each account as TTB's solution gains traction within their patient and clinician in the coming quarters
• During the quarter, User Registrations increased by 40k, a 4% quarter-on-quarter and 22% year-on- year growth in cumulative users, while Brain Profiles increased by 25k, a 3% quarter-on-quarter and 24% year-on-year growth in cumulative profiles
• During the September 2021 quarter, Total Brain collected A$554k in cash receipts, representing a 65% decline quarter-on-quarter, driven by large one-off payment received in the June 2021 quarter. On an adjusted basis, cash receipts increased 8% quarter-on-quarter
• Total cash outflows via payments from operating and investing activities (items 1.2 and 2.1 in Appendix 4C) increased by 3% quarter-on-quarter (A$159k increase), driven by an increase in

Total Brain Limited | ABN 24 094 069 682

15 Belvoir Street, Surry Hills NSW 2021, Australia

[e-mail] | totalbrain.com

For personal use only

administrative and corporate expenses due to the capital raise in July 2021 (A$355k), offset by a 5% decrease in staff costs and wages capitalized as intellectual property (A$202k), and a 17% decrease in marketing costs (A$55k)

• 1. Note: in accordance with Listing Rule 4.7C, payments made to related parties and their associates included in item 6.1 of the Appendix 4C include payments for remuneration of director fees to executive and non-executive directors in the normal course of business, excluding reimbursements of out-of-pocket expenses which is equivalent to the previous quarters expense
• During the month of October 2021, the Company undertook a significant right-sizing exercise in order to minimize ongoing expenditure
• 1. Approximately $4.2M of the company's annual cost basis was eliminated (25% of total), with reductions across all major line items, including people expense, marketing, corporate, administrative, directors' fees, and other. As part of the right-sizing, 15 active positions were eliminated and another 5 open positions that were previously being recruited for, were halted. As a result, Total Brain expects a 30% reduction in its 3-month-average cash burn down to A$830k/month

1. As part of this right-sizing exercise, management is refocusing the company's direct go-to- market efforts on the most scalable Affinity, Clinical, and D2C markets, and it plans to continue its work in the B2B Corporate market via distribution and channel partnerships

• 1. In addition, management is focused on securing additional funds for the business in the very near term, including proceeds from (i.) a A$2.3M R&D tax receivable that is currently being applied for, (ii.) D2C license transaction, and (iii.) select data licensing deals
• Given the proximity of the release of this report with the upcoming Annual General Meeting ("AGM") of Total Brain, investors are invited to participate in the AGM on 30 November at 10 am Melbourne time viahttps://web.lumiagm.com/358539167with further instructions available in the Notice of Meeting, which has been made available on the ASX platform and TTB website.

Louis Gagnon

Managing Director / CEO

Total Brain Limited

For further queries please contact:
Investor	Media
Simon Poidevin	Nigel Kassulke
President - Australia & New Zealand	Managing Director, Teneo Consulting
E:[e-mail]	M: [phone]
	E:[e-mail]

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Total Brain Limited | ABN 24 094 069 682

15 Belvoir Street, Surry Hills NSW 2021, Australia

[e-mail] | totalbrain.com

For personal use only

About Total Brain Limited (ASX: TTB)

Total Brain Limited is a San Francisco and Sydney based company that has developed and offers Total Brain, the world's first mental health self-monitoring & self-care platform powered by the largest standardised brain database. Its SaaS platform has helped more than 1 million registered users to-date scientifically measure and optimise their brain capacities while managing the risk of common mental conditions. Benefits for employers, large organisations and insurers include productivity improvements and healthcare cost reduction. For more information, please visit www.totalbrain.comand follow us

on Twitter,LinkedInand Facebook.

Authorised on behalf of the Total Brain board of directors by Non-Executive Director Matt Morgan

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Total Brain Limited | ABN 24 094 069 682

15 Belvoir Street, Surry Hills NSW 2021, Australia

[e-mail] | totalbrain.com

For personal use only

Rule 4.7B

Appendix 4C

Quarterly cash flow report for entities subject to Listing Rule 4.7B

Name of entity

Total Brain Limited
ABN	Quarter ended ("current quarter")
24 094 069 682	30 Sep 2021

Consolidated statement of cash flows	Current quarter	Year to date
			$A'000	(3 months)
				$A'000
1.	Cash flows from operating activities
1.1	Receipts from customers	554	554
1.2	Payments for
	(a)	research and development	-	-
	(b) product manufacturing and operating	(279)	(279)
		costs
	(c)	advertising and marketing	(263)	(263)
	(d)	leased assets	-	-
	(e)	staff costs	(2,403)	(2,403)
	(f) administration and corporate costs	(474)	(474)
1.3	Dividends received (see note 3)	-	-
1.4	Interest received	-	-
1.5	Interest and other costs of finance paid	-	-
1.6	Income taxes paid	-	-
1.7	Government grants and tax incentives	-	-
1.8	Other (provide details if material)	-	-
1.9	Net cash from / (used in) operating	(2,865)	(2,865)
	activities
2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a)	entities	-	-
	(b)	businesses	-	-
	(c) property, plant and equipment	(10)	(10)
	(d)	investments	-	-
	(e)	intellectual property	(1,401)	(1,401)
	(f)	other non-current assets	-	-

ASX Listing Rules Appendix 4C (01/12/19)	Page 1
+ See chapter 19 of the ASX Listing Rules for defined terms.

For personal use only

Appendix 4C

Quarterly cash flow report for entities subject to Listing Rule 4.7B

Consolidated statement of cash flows	Current quarter	Year to date
			$A'000	(3 months)
				$A'000
2.2	Proceeds from disposal of:
	(a)	entities	-	-
	(b)	businesses	-	-
	(c) property, plant and equipment	-	-
	(d)	investments	-	-
	(e)	intellectual property	-	-
	(f)	other non-current assets	-	-
2.3	Cash flows from loans to other entities	-	-
2.4	Dividends received (see note 3)	-	-
2.5	Other (provide details if material)	-	-
2.6	Net cash from / (used in) investing	(1,411)	(1,411)
	activities
3.	Cash flows from financing activities
3.1	Proceeds from issues of equity securities	6,523	6,523
	(excluding convertible debt securities)
3.2	Proceeds from issue of convertible debt	-	-
	securities
3.3	Proceeds from exercise of options	-	-
3.4	Transaction costs related to issues of	(472)	(472)
	equity securities or convertible debt
	securities
3.5	Proceeds from borrowings	-	-
3.6	Repayment of borrowings	(692)	(692)
3.7	Transaction costs related to loans and	-	-
	borrowings
3.8	Dividends paid	-	-
3.9	Other (provide details if material)	-	-
3.10	Net cash from / (used in) financing	5,359	5,359
	activities

4. Net increase / (decrease) in cash and cash equivalents for the period

4.1	Cash and cash equivalents at beginning of	1,427	1,427
	period
4.2	Net cash from / (used in) operating	(2,865)	(2,865)
	activities (item 1.9 above)
4.3	Net cash from / (used in) investing activities	(1,411)	(1,411)
	(item 2.6 above)
4.4	Net cash from / (used in) financing activities	5,359	5,359
	(item 3.10 above)

ASX Listing Rules Appendix 4C (01/12/19)	Page 2
+ See chapter 19 of the ASX Listing Rules for defined terms.