GTH
Gathid LTD
ASX
Interim Financial Report & Business Update
Sentiment:
Business Update
19 April 2024 3:11 AM
Gathid Ltd reports increased revenue for the six months ending December 2023, but faces ongoing challenges including a dispute over the sale of its physical security business and the continued suspension of its ASX trading.
Delay expected
The expert determination process regarding the dispute with Bloom is ongoing.
Summary
- Gathid Ltd's directors have approved the interim financial statements for the six months ending December 31, 2023, which have been reviewed by BDO.
- The company is currently involved in a dispute with Bloom, the buyer of its physical security businesses, regarding the Completion Statement calculation, which is undergoing expert determination.
- Revenue for the Gathid business increased to $284k during the six months to December 2023, compared to $73k in December 2022.
- The loss for the Gathid business increased to $755k for the same period, but this was lower than budgeted.
- The company has signed two new partner agreements to expand its sales reach in Australia and the Middle East.
- Gathid is working with the ASX to lift the suspension of trading of its securities, with the half-year financial statements being a key part of the decision-making process.
- The company is preparing for its US launch at the Identiverse Conference in Las Vegas.
- The board considers that the level of business operations that has been achieved is sufficient to warrant continued quotation of its securities under Listing Rules 12.1 and 12.3.
Sentiment
Score: 6
Explanation: The sentiment is neutral to slightly positive. While revenue increased, the company is still operating at a loss and faces challenges with the ASX listing and the dispute with Bloom. The management expresses confidence in future growth, which adds a slightly positive tone.
Positives
- Revenue increased to $284k (Dec 2022 $73k) during the 6 months to December 2023.
- The loss for this business increased to $755k (Dec 2022 $415k) in the 6-month period but this was lower than budgeted.
- The company signed 2 more partner agreements to increase the sales reach of the company in the Australia and Middle East markets.
- Marketing strategies have resulted in a pipeline of opportunities in Asia, Australia/Oceana, UK and the USA.
- All existing customers due to renew their contract with Gathid during this period have done so.
Negatives
- The company is involved in a dispute with Bloom regarding the Completion Statement calculation from the sale of its physical security businesses.
- The loss for the Gathid business increased to $755k for the six months ending December 2023.
- The ASX trading of the company's securities remains suspended.
Risks
- The ongoing dispute with Bloom could have financial implications for the company.
- The continued suspension of ASX trading could impact investor confidence.
- The company's ability to achieve significant growth depends on the success of its sales and marketing efforts.
Future Outlook
The management team is confident that the company can build on the foundational work that has been done and achieve significant growth.
Management Comments
- The Board is satisfied with the performance of the Gathid business since the divestment of the physical security business lines.
- The Board considers that the level of business operations that has been achieved is sufficient to warrant continued quotation of its securities under Listing Rules 12.1 and 12.3.
- The management team is confident that the company can build on the foundational work that has been done and achieve significant growth.
Industry Context
Gathid operates in the Identity Governance market, which is experiencing fast growth. The company is focused on customer acquisition, customer experience, and retention.
Comparison to Industry Standards
- The company mentions RightCrowd, but notes that the customer supported under the OEM agreement with RightCrowd has not renewed its subscription with RightCrowd during the same period.
- The company's customers are in different business sectors (online retail, financial technology and health insurance) and are based in different geographies (North America, Europe and Australia).
Stakeholder Impact
- Shareholders are impacted by the ongoing suspension of ASX trading and the dispute with Bloom.
- Employees are affected by the company's focus on resolving the dispute and building the Gathid business.
- Customers are impacted by the company's focus on customer acquisition, experience, and retention.
- Suppliers and creditors are impacted by the company's financial performance and the outcome of the dispute.
Next Steps
- The company will continue to work with the ASX to lift the suspension of trading of its securities.
- The company will continue to pursue the expert determination process regarding the dispute with Bloom.
- Gathid will launch in the US at the Identiverse Conference in Las Vegas.
- The company will continue to train partners to enhance their effectiveness in creating sales opportunities.
Key Dates
- 21 September 2023: Completion of the sale of the physical security businesses.
- 31 December 2023: End of the six-month period for the interim financial statements.
- 29 February: Announcement to the ASX regarding the dispute with Bloom.
- End of next month: Gathid's US launch at the Identiverse Conference in Las Vegas.
Keywords
GTH
Gathid LTD
ASX
Sector: Software & Services
Filings with Classifications
Better than expected
16 April 2025 7:19 PM
Quarterly Activity Statement & Business Update
- The company's ARR growth of 142% indicates better than expected performance compared to the end of FY24.
Delay expected
23 January 2025 10:41 PM
Quarterly Report
- The company is waiting for the resolution of a dispute over the sale of its physical security business before relisting on the ASX.
- The audit opinion in respect of the FY24 Financial Statements may require further actions by the ASX before any relisting takes place.
Better than expected
23 January 2025 10:41 PM
Quarterly Report
- The company's ARR growth of 12% in the quarter and 92% since the end of FY24 is better than expected.
- The company secured two new customer contracts and maintained a high renewal rate, which is better than expected.
- Sales revenue increased from $272k to $390k, which is better than expected.
Worse than expected
21 November 2024 5:50 PM
AGM Results
- The 'first strike' against the remuneration report indicates that the company's compensation practices did not meet the approval of a sufficient number of shareholders.
Worse than expected
20 November 2024 11:15 PM
Annual General Meeting Results
- The rejection of several key resolutions, including the remuneration report, incentive plan, and placement facility, indicates worse-than-expected results from the AGM.
Capital raise
20 November 2024 11:15 PM
Annual General Meeting Results
- The rejection of the 10% placement facility suggests that securing additional capital may be more challenging than anticipated.
Delay expected
20 November 2024 8:05 PM
Annual Report Presentation
- The finalization of the sale of the RightCrowd businesses has been delayed due to an ongoing dispute with the buyer, Bloom.
- The audit of Gathid's FY24 financial accounts has been delayed due to Bloom's failure to provide necessary documents to the auditors.
Worse than expected
20 November 2024 8:05 PM
Annual Report Presentation
- The company's overall profit was driven by the sale of its RightCrowd business, masking a significant loss from its core Gathid business.
- The ongoing dispute with Bloom regarding the sale of RightCrowd and potential further claims creates significant uncertainty and financial risk.
- The auditors' inability to provide an unqualified opinion on the financial statements due to lack of access to information from Bloom indicates a significant shortcoming in the financial reporting process.
Delay expected
4 November 2024 8:00 PM
Quarterly Report
- The finalization of the sale of the physical security business has been delayed due to a dispute over the final payment calculation, impacting the company's ability to provide the ASX with the required information for relisting.
Worse than expected
4 November 2024 8:00 PM
Quarterly Report
- The unresolved dispute regarding the final payment from the sale of the physical security business represents a significant negative deviation from expectations, creating uncertainty and delaying the company's ASX relisting.
Worse than expected
18 October 2024 1:15 AM
Suspension Notice
- The announcement details numerous companies failing to meet reporting deadlines, resulting in potential delisting, which is significantly worse than expected performance.
Capital raise
16 October 2024 6:58 PM
Notice of Annual General Meeting
- The company is seeking shareholder approval for a 10% placement facility, allowing it to issue equity securities up to 10% of its issued share capital over a 12-month period.
Delay expected
30 July 2024 12:04 AM
Quarterly Activity Statement
- The resolution of the dispute over the consideration due for the sale of the physical security businesses is delayed.
Worse than expected
10 July 2024 2:15 AM
Market Announcement Long Term Suspended Entities
- The document indicates that numerous companies have failed to meet their reporting obligations, which is worse than expected for market compliance.
Delay expected
10 July 2024 2:15 AM
Market Announcement Long Term Suspended Entities
- The document lists numerous companies that have delayed lodging required periodic reports.
Worse than expected
20 June 2024 7:12 PM
Release to ASX
- The expected cash balance is lower than the previously announced target.
Delay expected
20 June 2024 7:12 PM
Release to ASX
- The FY23 R&D Tax Incentive claim will be received after 30 June 2024.
- The FY23 income tax return submission is delayed due to the expert determination process.
Delay expected
19 April 2024 3:11 AM
Business Update
- The expert determination process regarding the dispute with Bloom is ongoing.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.