Thanks @Strawman a meeting would be great, Wayne seems like a real straight shooter (yes SAS pun intended) so it would be great to hear him talk more about the business and opportunity to firm up what the opportunity is. I am shy on doing a valuation at this point due to the rate of change in the business but better understanding the mechanics will help and add more understanding to figures as they come out.

Cheers.

Great writeup @Tom73 You have got me looking closer at this one.

There's a bit of reading to do.

So yesterday's price jump is Intelligent Investor members getting on board? Is that right?

Thanks @Arizona ,

I don't have any proof but it's a highly illiquid company that has just had some reputable spooking via Intelligent Investor to a group of investors looking for things to invest in and who have had the weekend to listen to it. So I am pretty sure that is what it is, a common phenomenon generally for small caps is a Monday bump as "retail" investors do their research on the weekend and buy on Monday.

Makes sense @Tom73

I note buyers were pretty thin on the ground compared to sellers this morning, but that has shifted a bit now with some buyers coming in.

I'll go and keep reading

Thanks again

Just got off the phone with the CEO Wayne Jones.

He's about to fly to the US, but is keen to chat with us in early Feb. Will post details as soon as it's locked in.

Thanks, it must be for Shot Show, they are an exhibitor:

2025 SHOT Show Planner - Operator XR

If I'm reading it correctly they have about 8m in debt at an average of 11%. It'll be worth keeping an eye on the DOGE agenda. I assume that Republicans will want to reverse the 'defund the police' vibe and support the police so DOGE may not be applied to law enforcement agencies, or funding may even increase. But the last few years have been tough for US police agencies and I co-incidentally saw a fairly similar US training provider recently complaining that agencies were struggling to maintain their training budgets.

However, it looks like XReality are perhaps disrupting that industry and their credibility, insights and better designed systems seems to have them gaining where competitors are stalling.

Alan Kohler 2nd Interview (24/3/26)

Alan has just interviewed Wayne Jones again (available with Intelligent Investor – may be paywalled), it was his interview early last year that put me onto XRG. There was a price spike following the interview last year, so we may see it again following this one.

My notes on discussion:

• DoD paid XRG to develop a new Mixed Reality (MR)product which uses cameras to augment the real world (augmented rather than virtual reality). The drone defence product is an extension of this as they move from a narrow scope use case with the DoD to a broader application. Was north of 20 companies bidding for the original DoD which they won.
• Just tipped over 100 customers in the US, average US$150k value. Note was 89 at the end of December so they are keeping their run rate up at around 10+ a quarter.
• Mixed Reality (MR) suite is yet to be launched, will not replace VR because MR is about augmenting existing training facilities. Pricing will be similar, but mission pack based.
• Texas DPS contract involved 26 separate agencies across Texas, all the kits are in operation, north of 100 headsets.
• XRG is in the top 3 VR training systems companies in the US now (customer based), but use of VR is only nascent so the market is growing rapidly, with an 18,000 agency opportunity in the US in law enforcement alone (XRG have 100 so far).
• December launched the counter drone system, small drone, hard to train for (shotguns most effective – like clay pigeon shooting…), beyond shooting it, it is about unit tactics on contact with a drone that is important which is way beyond a shooting range type training tool. Close to being on market, will be equipment agnostic for counter drone equipment, so don’t want to pigeonhole based on specific equipment. Company develops products from ground up – ie developed using teams with real experiences. Building up distributors in Europe and attending trade shows. Price will be similar to OP2 system, a mission pack add on approach.
• Getting a lot of interest out of Europe from the police, but the process is longer because these agencies are more centralised and in-depth review process (note this suggests less contracts but they will be massive). Wayne thinks they will be able to disrupt the European market, expecting a similar aggressive take up like in US.
• iFLY divestment underway with a consulting group, it’s holding $16m on the balance sheet, didn’t want to speculate on what they may get – understandable given commercial negotiations.

Wayne was at his laid-back best and spoke comfortably about the expanding market opportunity beyond US Police Departments, being the DoD AR spin outs and Drone training as well as progress to getting into the European market.

Disc: I own RL+SM