Operational Highlights
- Order book increases during the period, with orders being won from a range of customers opening up new territories
- Board and management team streamlined and strengthened with the Group now firmly focused on converting the order book into revenue
- New team recruited into India with extensive industry experience
- Identifiable global new business pipeline grows at a rapid rate
- Expanded eco-system of partners across a number of territories
- Development and completion of new standards-based Omni IoT platform resulting in opportunity for new revenue streams including licensing. First order received for this technology and deployment of this order commenced in December 2017
Financial Highlights
- Revenue of £1.17m (2016: £1.82m) with the decrease directly as a result of the delay in deployment of a large customer contract notified to the Company just before the period end
- Operating loss of £11.15m (2016: £7.94m)
- Significant investment in strengthening the team to prepare for deployment of orders and research and development to complete development of new standards-based Omni IoT platform
- Research and development tax credit receivable increased to £1.4m (2016: £0.7m)
- Cash and cash equivalents of £5.39m (2016: £3.89m) following new equity funding during the period of £11.3m before expenses
Post Year End Highlights
- New order won from Larsen & Toubro for $3.2m
- The CESC Mysore contract in India has now officially passed the User Acceptance Testing milestone which has resulted in a cash payment of £0.3m having been received.
- The Company has taken positive steps to manage and reduce the cost base, with significant reductions being made in the last six months. The cost base from July 2018 onwards is expected to be around £670k per month, which is significantly lower than the average operating cost per month in 2017 of £808k
- R&D tax credit cash refund claim of £1.4m (2016: £0.7m) has been submitted to HMRC
John Cronin, Executive Chairman of CyanConnode, commented: “This was an important period for the Company with the successful integration of the IPv6 technology from the Connode acquisition, announced in June 2016, the expanded geographic footprint and scale of orders won during the period. In total we announced ~$50m of orders during the period, highlighting the strength of our value proposition within the smart metering markets around the world. Integration work is currently being undertaken with partners in three new territories with initial payments now received from these territories. In addition we have had successful demonstrations of our technology in a number of new locations.
“The nature of our business model has led to a significant committed pipeline of future revenues as we commence delivery on a number of high value contracts and, as such, the key objective remains focused on converting orders into revenue and profits as our business model evolves towards a cash generative one that can support and accelerate our ongoing corporate development.
“Our team continues to enhance our product suite, providing higher margin opportunities, while widening our potential customer base and the management team continues to invest in the Company and work tirelessly to provide significant returns for all of our shareholders.”
The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.
CyanConnode Holdings plc wins $3.2 million order from India
Largest order to date for IPv6-based smart metering solution in India
CyanConnode, the world leader in narrowband radio mesh networks, announces confirmation of a purchase order from Larsen & Toubro (L&T) for a smart metering deployment based solution that will enable a secure, IoT network canopy covering 15 zones of the Indore circle from the Indian state-owned utility Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Ltd (“MPWZ”) worth $3.2m, to commence deployment in the current financial year.
This is a further order from L&T for whom it has already delivered 25,100 units throughout India. Importantly, this is the second order for CyanConnode’s new Omnimesh Advanced Metering Infrastructure ("AMI") solution, highlighting the strong value proposition of the Company’s advanced IPv6 standards based product, which is now becoming the requirement in certain territories around the World.
Order details
The purchase order is for an IPv6-based smart metering implementation for MPWZ in Indore. The smart meters will be deployed over the next two years with initial delivery commencing before the end of the current financial year.
MPWZ operates in Madhya Pradesh and serves a consumer base of more than three million in Indore and Ujjain, providing substantial scope for follow-on orders in the future. CyanConnode will supply its Advanced Metering Infrastructure (AMI) standards-based hardware, services and head end software licenses to L&T. The software will be charged on a per meter per year basis with an annual maintenance contract, delivering a recurring revenue stream over the initial five-year contract term.
The IPv6-based solution
CyanConnode’s IPv6-based solution will enable a secure, IoT network canopy covering 15 zones of the Indore circle, with a capacity to connect up to 250,000 devices. The standards-based narrowband mesh technology supports build-as-you-go networks, which will allow MPWZ to rapidly scale its smart metering implementation across its consumer base.
CyanConnode’s technology, which meets the technical requirements for AMI in India, will be integrated with L&T’s IS 16444 smart meters to comply with Bureau of Indian Standards meter protocol. The integrated solution, which includes meters, RF mesh communication and head end meter management will enable MPWZ to remotely monitor and control energy usage to reduce distribution losses
John Cronin, CyanConnode Executive Chairman, commented: “We are pleased to announce such a significant order from our strategic partner, L&T. During 2017 the company continued its positive momentum in the region and this second contract win for CyanConnode’s new Omnimesh demonstrates the suitability of the product as well as the growing demand for standards-based solutions.
“CyanConnode are working in partnership with L&T, collaboratively addressing the evolving needs of the Indian utilities sector. L&T is a leading provider to the Indian utility sector and the integration of CyanConnode’s standards-based communication technology with its smart meters demonstrates the strength of the partnership as well as the suitability of our award-winning technology for the Indian market.”
www.cyanconnode.com