Swift TV Ltd (STV) Earnings Call Transcript & Summary

Hello, everyone, and welcome to the Lynx Discovery Series: Health Innovation. I'm David Tasker, and I'll be moderating today's session. Today, we'll hear from 3 ASX-listed companies entering an important phase of commercial growth. PainChek, Swift Networks and Memphasys. Each company will present, followed by a short Q&A. So if you do have any questions, please submit them using the Q&A function on your screen. Today's discussion is general information only and does not constitute financial advice. I should also disclose that I am Chair of Memphasys. We will begin with Joe Durak from Lynx Advisors, who will briefly introduce Lynx and explain why it has brought today's webinar together. Joe, over to you.

Thanks, Dave. Appreciate it, mate. Good afternoon, everyone, and thanks very much for joining us for this first Lynx Discovery Webinar Series where we cover health innovation companies. For those who don't know much about Lynx, we're a boutique corporate and investment advisory firm based -- sorry, focused on the Australian micro and small cap market. We work closely with selective ASX-listed companies, we believe have unique and scalable technologies and have global potential. And of course, it's important that they're run by proven management. We see a lot of opportunities, but we're very selective. PainChek, Mem and Swift TV are 3 businesses we know really well. Currently, we act as corporate advisers to Swift and Mem, and we've been invested in PainChek and supported it for many years. We believe each of these companies has world-class technology, blue-chip customers and growing revenue. And now it's just a matter of scaling those revenues globally. That's really the thinking behind today. We wanted to bring together 3 companies. We've got a high degree of conviction in and give investors the opportunity to hear directly from the people running these companies. This is the first time, as I said, that we're running in this format, and we're looking forward to doing many more of these in the future. So thanks very much for joining us, and I'll hand back over to you, Dave.

We will now turn to Swift Networks, which is rolling out its Swift TV platform across aged care, workforce accommodation and hospitality. Joining us is Managing Director and CEO, Brian Mangano. Brian, welcome, and over to you.

Thanks, David, and thank you, everyone else, for joining today. Much appreciated. For those of you who don't know, Swift TV is a very new enterprise-based TV system. So it's designed for business. So when you look at the market of what exists at the moment, it really is very expensive TVs designed by either Philips, LG or Samsung. So what that means with a TV design for business is the ability to use the TV more than just a smart TV. It's the ability to integrate into your property management system, whether that's an aged care facility, a hotel or a mine site. Next slide, please. If you look at Swift and what we've achieved to date, as a business, we've already got an established revenue stream of close to $14 million in FY '26. Our recurring revenue is a large proportion of that at $12.2 million. And of our new Swift TV Device, which was only launched 28th of May this year, so less than 4 months ago, we've already sold 7,200 devices, and that's to 13 enterprise customers. And we're talking premium customers across mining, aged care and into hotels and resorts as well. We've currently deployed by 30 June, about 52% of those. So there's a few more still to be deployed this financial year. And what Swift TV represents is really a 2.5, maybe 3-year multiyear investment into this technology. So it really is the latest chipsets. It's also fully Google and Netflix certified, and that's very important in the TV environment, not just within Australia, but also internationally. And also the big takeaway is we're in 3 markets already. So aged care mining and workforce accommodations, and hotels and resorts. So we basically have already expanded the scope of the product by using the same platform with different user interfaces that are designed for each of these markets. Next slide, please. Just looking at how Swift TV works in the environment in which it works to really give you a quick snapshot. It's one platform that really connects the enterprise with people, users in the room and also with the world. So it might be in an aged care environment where the resident has a TV experience. Using our app, family members can even put a picture or a video directly on to the resident's TV. So it's a real nice seamless experience for the resident rather than just going to their phone where it will be forgotten about or not looked at. But more importantly, in terms of other environments, that integration ability in terms of being able to upgrade the TV really differentiates it from a standard smart TV. So standard smart TV has its software built in when you first buy it, which can age very quickly as new apps come available, new technology becomes available such as AI. These things can't be updated remotely, whereas with our system, the TV can actually be remotely managed and upgraded by the enterprise or by us on behalf of the enterprise. We also have a very slick management interface that allows the businesses, whether it's an aged care provider or a workforce accommodation to put all sorts of notices on the TV, whether it's a barbecue happening in 5 minutes or the activity schedule for someone for that particular day in an aged care facility. Next slide, please. So when you look at Swift, I sort of really look at it as 4 elements that really provide the value behind what Swift is. It's really this UI/UX that's actually a user interface, a user experience that's unique to each of the environments that we work in. That's something we've developed over years and years, and it's unique in that it is a business user interface. It's not a user interface for a domestic TV, which just gives you the apps. This is a user interface that can put all sorts of information on the TV in a 2-way fashion that basically makes it easy to use both from an end user point of view and also from the actual facility that's trying to communicate with people in the various rooms. The technology itself is a very slick effectively small box and remote control that is very easy to install. It's basically plug-and-play. So what we're finding end users or the providers themselves can actually put it into their TV sets immediately. It's unlike having to put a new TV on where you have to muck around with things. It's a very, very simple device to put on to the TV. And we're seeing that across all our verticals now. So part of that has been the experience that we've had with Google. So that integration with Google and working within the Google environment is very, very important moving forward. It allows us to open up into the Google Gemini 2 AI functionality in the future. It also allows us to have full complete access to the Google App Store. So effectively, you're not just restricted to the apps that are on your TV when you buy a particular TV, but any streaming app that's available on the Google App Store can be downloaded immediately and used on the TV. So it's nice and slick, easy to use and it's a very familiar interface. So it's very similar to what you'll find at home, but with that enterprise layer. And when I talk about enterprise layer, that's really that integration. So in a hotel environment, it's the ability to integrate directly with the property management system. So if you log into Netflix or YouTube and use your own personal log-ins, you can be assured that at the end of your stay, that will all be cleared out of the system. So no longer going into a hotel and forgetting your Netflix logged-on as you move out of a hotel. So we can actually -- in the future, we're looking at working with hotel providers to even integrate that. So when you move into the room, all of these things will be immediately logged-on for you based on your profile with the actual establishment. So that's something that can work in workforce accommodation like a mine site. It can work in hotels and more so it can work in aged care where the person in the room is more of a resident rather than a guest. So it allows us to have that full integration, which is not just important for us to say, in upgrading the tech point of view as you need to, but also just working within the property management system or even the point-of-sale system. So ordering things through the TV becomes a thing that's now possible with Swift TV rather than having to use a QR code and do a multistep process, you can now order straight through the TV. So this is something which can have a lot of utility in the different environments, but really comes down to the provider and whether they want to enable that functionality. The other element to Swift is really we have very good, long-established content license deals with a lot of major studios. And that's become very important for us because that really gives us this new release window of movies. So we're basically in the same window as a lot of the airlines. So that attracts people to use the platform. And basically, once you've got them on the platform, it adds value to what they're doing, whether it's in a hotel, that's something maybe the hotel could charge to guests or provide guests for free. But it also just enhances the experience. We can also, with our own content, have curated content, for instance, whether it's our own content, we might have dementia-specific content in the aged care environment that we put on the TV. But it could also be using, say, a mine site's own content, whether they have employee assistant program videos which sometimes are sort of only available through an app, you can put them on to the TV. That encourages workers on site to view videos on maybe financial planning for FIFO workers. So that's a sort of utility that we can bring to any TV set. So you don't need a specific TV, anything with the HDMI cable really has this capability. Next slide, please. So where we are? As I mentioned, $12.2 million of revenue is already out there in a lot of our preceding products that Swift has developed over the years. This has really been a massive step change for us. So we're now -- I suppose, for lack of a better term, we're in the big league. We're playing with the big boys working with Google and Netflix. We're the only Google-certified provider in Australia at the moment for this type of system. And that's led to 7,000-odd boxes. So when you look at who we've actually sold it to, Chevron was one of our first big customers. So we're talking a premium customer here, one of the world's biggest oil and gas companies has taken us on, and we're talking about 3,000, nearly 4,000 devices being rolled out to Chevron. So very large deployment shows the scope and the scale that we can operate on in what can be a very arduous environment up in the Northwest of Western Australia. Recently, we've also signed a deal with Opal Healthcare, which is the largest aged care provider in Australia, and they've basically started to roll out Swift TV to a number of their sites as well. So deployment is well and truly underway. And really, our next step is scale. So we're moving into hospitality and hotels. We've had the first 2 customers in hotels recently with Daydream Island and Seashells Resort in Mandurah and Broome, both taking on the product. And interestingly, both of those resorts actually self-installed the device. So we could remotely commission it, makes it very easy. And that's very important in a hotel environment because you're not disturbing people in the room. You're not taking away room nights while you change a whole TV system and move brackets and knock around with things. It's basically something that they can do with their maintenance team. And that really is that plug-and-play design that we've really concentrated on with this product because that's really what will drive scale for us as a business. Next slide, please. Now looking really at who we sell to, and this is really the bit which sometimes when you're in the business, you forget how good this is. We are currently selling to some of the biggest companies in the world, it's Chevron, Opal, Shell, Bethanie, Compass Group. We've got quite a list of premium customers that are using our product. And a lot of these customers have the ability to scale further. So we might have only done a few sites, and then there's a lot more scope for further sites as we roll out the product to them across the whole portfolio. And this is something that a lot of providers are looking for is a product that on a site-by-site basis, people can manage and put out messages, but also on a corporate basis, some of our larger mining clients, they might have a corporate message that they want to go across multiple sites. They might have 24 different mine sites across Australia, and they want their corporate messaging to be consistent across those sites because Swift TV can do that. But at the same time, you can have log-in so that the kitchen on a particular site can let people know that the barbecue is about to happen and what the menu is for that day. So that's the flexibility of our user interface that allows that ability to communicate with people. And that is very important in a lot of these environments. A mine site is very important because you have people who work on site every day out in the field. They don't necessarily have connection to their employer. So the TV becomes a large focus for their connection with their employer and for notices, and it always becomes a company Internet. Same within health care environment in aged care can be quite isolating. So just providing notices or people who are maybe bedridden or don't have mobility issues, be able to see maybe a live stream from a communal area. These are all important things that can be done with a business-based system that you can't do with a normal smart TV sticking in the corner of the room. Also additionally, we have presently quite a number of enterprise customers who are still to move to Swift TV. These are customers we have with our previous product or we provide other services too. So we do already have a path to market with a number of other big customers who we have to see to move to Swift TV in the near future. Next slide, please. One of the key things that we've really focused on in the last probably 3, 4 months since we've actually introduced Swift TV is resellers. In all of our markets, there are strong reseller presence and they're usually in the form of Facility Management Companies, companies like Sodexo, Compass or technology companies like Datacom. These are companies that either look after businesses ICT portfolios or businesses mine sites. So something like Compass does the entire facility management. Also, these companies also extend to other areas. So we're building relationships with these customers with a view that they have a very strong path to market. They might be the technology holder for a particular enterprise customer and getting them across the line and getting them to help resell our product really expands the scope of the addressable market for Swift and really keeps our costs down. So I don't have to employ a lot of salespeople running around to all these different environments. I can really leverage off people's relationships. And it also gives a sense of approval for the product. If you have your largest ICT provider who does all your systems say this is a great system that works on your network, it really opens it up for us and makes it a lot easier. Next slide, please. So I'll just touch on really quickly the 3 environments that we moved into. One is workforce accommodation, so that's large oil and gas companies. It could be defense bases, it could be mine sites. And that gives us a lot of scope. That really was our DNA in Swift where we started off in that mining environment in the Northwest of Western Australia. We learned a lot of lessons in what is a very, very arduous environment. And that's really proved us out. So we have very good direct relationships in that environment. And hopefully, we can scale more and more within that environment. So there are several features that our product brings to that environment like we use very low bandwidth. We have very good entertainment packages, plus, as I say, that ability to be able to communicate with the staff on site is so important. So they're just some of the little issues -- the many issues, I should say, that Swift TV addresses for those customers. Next slide, please. Hospitality, hotels and resorts is a very new one for us. We've really only just launched into that. And that's -- so our first few sites have only just come on stream. Both sites are in relatively remote areas. So we haven't even really started to sell into the CBD market, which is our next step as well and be launching at the big hotel conference on the 23rd of September this month in Sydney, where we're really starting to push our product into that market. We see a lot of opportunity for that market, not just in Australia, but overseas as well. This is a market which if any of you have stayed a hotel recently, what you see on a hotel TV screen is far from adequate. It's very reliant on casting, which can be hit and miss. Our product works on a whole new level. In fact, the whole using of apps native to the screen that are easily accessible is really the future that we see. We still offer a casting functionality for those who want that, but a lot of it is more of a secure casting that's fully Google approved. And it's all integrated in the actual device. So there's no other device that sits in the room or be plugged in. It's basically fully integrated and fully Google and Netflix approved. Those improvements have taken multiple years to get. So it's not something which we take lightly, but it's very important in these markets as we move to really the status that we're in. So there's a lot of opportunities to really now see the TV has ability to maybe generate revenue again for the hotels, whether that's to put more direct advertising on the TV, integration into event management companies, maybe ticket sales, obviously, integration of the point-of-sale system and also integration of their property management system. So we also see the ability to maybe resell movies as a package. So rather than the old school way of selling a movie pay by view for one single movie, which you could probably get away with 5 years ago. Really, what we see is the ability and what we're seeing from our customers is the ability to sell maybe a whole package of new release movies for a minimal amount for your stay. So that's something that's a lot more attractive. And we see a lot of value in that because we get the movies probably about 6, 7, 8 weeks ahead of Netflix and the streaming services. So you can go straight into streaming or look at movies and then you get this real nice direct revenue stream for the business. Next slide, please. And really bring it back to health and aged care, which is really a market which we see a lot of growth coming from, especially with the new legislation coming into effect from 1 November. We are working, as I say, with the largest provider in Australia. So the largest provider, Opal has really provided a big tick for us as a business. They are looked at as a real leader in this environment. And that's where we see a lot of benefits for us to not just grow but also to learn from that environment as well. What we can do with our system is more than just communication. We can also provide better clinical outcomes. For instance, we do provide dementia content that's specific to aged care. We also provide a low sensory content. There's various other things that can be used through the TV, which is effectively a very familiar interface that provides comfort for people in that environment. So it's very important to have an interface that people can use. People have tried using mobile phones or tablets. Unfortunately, those things require people to make sure they're charged, make sure they're used, make sure they're present, make sure they're not broken. So it adds a cost burden, whereas the TV is there sitting on the wall in a lot of ways, it's very underutilized. And by using this system, it really opens it up for people in that industry for more than just communications, but also from a care point of view. Next slide, please. So why Swift TV now? As I mentioned, we've got this fantastic new product, which we've only just started really releasing. So very early days for us, 7,200-odd screens already sold at 30 June, so there's more that has sold since then. We've got a strong revenue base from our residual products. What we expect to see is a lot of that revenue base signing up to new Swift TV agreements for long terms because effectively, in the business environment, we see our contract terms somewhere between 3 and 5 years for people to actually move to our system. So having those relationships already with those customers, seeing the transition to the new tech has been very beneficial for us. Also, we see a lot of changes happening in the whole TV environment with the Google Android platform and partnering with them is very important. As I mentioned, with the Google Gemini AI, that will be open to us as that moves forward into the TV Android market, which opens up a lot more technical opportunities for us in the future. So we're working on that with Google as well. And really importantly, it's the real step change for us as a business has been the plug-and-play ability of this device, the fact that anyone can deploy. This has saved considerable amount of time and deployment. It also, as I mentioned, allowed customers to deploy it themselves. So it cuts down the time line. So between sale and revenue starting, which is basically on commissioning of the device, we can really shorten that time line and move forward. Next slide, please. I'll just touch on briefly. We have quite an experienced Board of management. Charles Fear was one of the founders of Argonaut, well-respected Perth brokers. Nick is also on the -- involved Pure Asset Management, which is the lender of the company. So we have a very good relationship with Pure Asset Management. Brad Denison, ex-Fleetwood and also involved in the land lease community, which is another area we're looking at moving into. And Ryan and myself are management who basically do the day-to-day work and make sure we're growing and growing rapidly. Thanks very much. I might just open up the questions and take from there.

Thanks, Brian. Great presentation, great update. I think there's a statement here, which is more of a question, which was if you only launched in May of this year, how did you get sales so fast?

Basically, we had some presales. We actually had Chevron coming to us in, when was it, late December saying, "Look, we're going to upgrade our site. What can you do for us?" So we actually had to airfreight in quite a number of boxes in preproduction mode to get them rolled out to their first site, which is about nearly close to 2,000 rooms, and that happened in probably March by the time they had their site shut down and we were able to roll them out to their site. So unfortunately, you can -- we were hoping to have that product launch and then take it and roll out at a nice controlled pace. But when a company like Chevron comes knocking you all and wants it tomorrow, you jump and you get it to them tomorrow.

Now you've sold more than 7,000 higher-margin Swift TV devices, as you said in your presentation, with many still to be deployed. What needs to happen before those devices become live? And how quickly can they convert into recurring subscription revenue?