XMReality Interim report, Group overview, July – September 2022

The Annual Recurring Revenues (ARR) turned slightly in a positive direction and increased 2 percent compared to Q2 this year. Net Sales decreased by 15 percent compared with the previous period. The company also communicates its financial goals.

The Quarter July – September 2022, The Group

• Net sales amounted to SEK 4,482 thousand (5,286).
• Costs totaled SEK -15,311 thousand (-12,777).
• The operating loss before taxes was SEK -7,895 thousand (-7,022).
• Cash flow was SEK -10,973 thousand (-9,294) and the equity/assets ratio at the end of the period was 52.1 (80.9) percent.

Net sales decreased with 15 percent to SEK 4,482 thousand (5,286). The Annual Recurring Revenues (ARR) were in large unchanged and SEK 18,447 thousand (18,523) compared with Q3 2021. However, compared with Q2 2022 the annual recurring revenues turned slightly upwards and rose by 2 percent. The absolute majority of the revenues were recurring software subscriptions. The Gross margin continued to be high at 97 (90) percent for the quarter. The Order backlog, Order intake that at the end of the period remains to be recognized as Net sales, decreased 25 percent to SEK 11,206 thousand (14,964). The increase in costs mainly comes from additional sales resources to strengthen our wholly owned U.S. subsidiary, and increased investments in product development.

The Order intake for the quarter was significantly lower compared with Q3 2021 and decreased 54 percent to SEK 2,357 thousand (5,136). The reference quarter, Q3 2021, had two large two-year orders and a larger order from the world’s largest brewery (Anheuser-Busch InBev).

The company’s financial goals are to no later than the end of 2024 start to generate a positive cash-flow, and by 2025 reach an ARR of SEK 75 000 thousand with a 15 percent EBITDA.

The period January – September 2022, The Group

• Net sales amounted to SEK 13,907 thousand (16,608).
• Costs totaled SEK -50,335 thousand (-39,205).
• The operating loss before taxes was SEK -28,079 thousand (-21,036).
• Cash flow for the period was SEK -32,363 thousand (34,916).

Notable events during the quarter

• ABB placed an additional order with an annual value of SEK 1.5 million. ABB Process Automation in the U.S. ordered a significant number of Remote Guidance licenses using the Framework Agreement XMReality has in place with ABB. XMReality has previously been used within ABB Motion. The corresponding cash-flow effect from the order will be in Q4-2022 (SEK 0.25 million) and Q1-2023 (SEK 1.5 million).

Notable events after the quarter

• Cobalt Housing in UK have ordered XMReality Remote Guidance for first line support. Cobalt Housing Ltd is a registered housing association based in North Liverpool.
• XMReality signed a 5-year re-seller agreement with a large global industrial corporation with more than 100 000 employees and activity in more than 100 countries. The agreement enables the customer to re-sell their branded (white-labeled) version of XMReality Remote Guidance to their global customer base. The same agreement also serves as a 5-year Frame Agreement for this existing customer internal purchase of the same product. The agreement as such do not guarantee any orders.
• Saab has doubled their XMReality License Holding. As communicated back in October 2020, Saab who serves the global market with services and solutions within military defense and civil security, and XMReality signed a three-year contract where the main portion covered a fix fee. Saab has now ordered additional licenses as their use has increased.

In this video Jörgen Remmelg, CEO of XMReality, together with Johanna Edepil, CMO, talks about the reported result for the company and which events that are particularly interesting to highlight for the investors.

Link to the report website: https://www.xmreality.com/en/investors/reports-and-analyzes

This disclosure contains information that XMReality is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 2022-10-20 08:30 CEST.

The company’s Certified Adviser is Redeye AB
www.redeye.se

For more information, please contact:
Jörgen Remmelg, CEO XMReality
Phone: +46 739 822 409
E-mail: jorgen.remmelg@xmreality.se

About XMReality Remote Guidance™
XMReality Remote Guidance is an AR-enabled knowledge sharing tool that lets you communicate with gestures, speech, chat and pointers with someone at a completely different place. It includes:

• A unique hands-overlay technology that lets you guide someone else’s hands—as if you were there.
• A web portal to manage teams and users, and to measure usage
• Integration through client-side API’s (Application Programming Interfaces)

About XMReality
XMReality AB (publ) develops and sells solutions that revolutionize knowledge transfer through so-called Augmented Reality (AR). The company is a market leader in remote guidance where you guide a person on site via AR to solve problems or prevent them from occurring. The product is used globally in more than 60 countries. Nestlé, Electrolux, Sidel, Heineken and Saab are examples of the more than 125 customers. XMReality is based in Linköping and in the U.S. and is listed on the Nasdaq First North Growth Market (ticker: XMR). For more information, visit: www.xmreality.com