I agree @fcmaster26

I've emailed Mal and will report back with what he says.

Thanks Andrew! I tried to reach the investor relation weeks ago but haven’t heard anything back, which is quite disappointing. Maybe they will answer if I had a larger position lol.

ugh, yeah I tend to place IR folk right up there with RE agents and brokers :)

(no offense to those in the industry -- there are very notable exceptions to the rule! Also, people in glass houses etc etc)

Anyway, the communication with Mal is as follows:

I was hoping you could clarify whether these contracts are entirely fixed priced for the contract period. Also, is the contract with Siemens Korea also for a 5 year term?

As per all our Aura Ai-X contracts there is a supply contract and a service contract for a period, some 5 years some shorter some longer it does depend on the region and customer. The key is Aura Ai-X has a recurring and data support embedded function. Does that clarify, obviously I can’t break the contract down in detail 

Thanks Mal -- just for the avoidance of any doubt, the US$0.7m contract announced today includes both the supply AND service components? And that is the total amount receivable under the contract length.

Correct it's a comprehensive contract supply and service which includes support. The reason it is so critical to us is the future potential and the success of Ai-X

You are a legend!

@fcmaster26 don't feel too bad I had the same response as you last week. But who can refuse a request from the smiling assassin @Strawman!

So from this we can assume that the upgrade and support contract from the previous airport announcements are pretty small. As I am thinking the circumference of a solar farm is probably slightly larger than an airport so we get $0.7 vs 0.5m. In this case the $0.7m also has the supply component embedded (maybe the last airport one did too?).

I am a bit confused on why they are making such a fuss about the recurring revenue component given that it appears to be relatively modest. I may be simple but to me the attractiveness of ARR is that you know a lot of what future years numbers will be and you are not as susceptible to year to year variation in contract wins. I don't really see that occurring hear as it looks like the recurring revenue here is probably only $100-150K over 5 years. So $20-25K/yr, which, interestingly, corresponds to a number they mentioned in the last results webinar - where the CFO I think said that the recurring comp was around $20000/yr per system. My question mark when I heard it was whether multiple systems make up each install, but it now looks like they don't.

I am actually a bit underwhelmed.

I guess its good that they are getting new contracts and it looks like Aura Ai-X has a good future and does it make any difference if they win 1 x $10m contract or 10 x $1m contracts?

I think the team is having a hard time trying to sell software solution (FFT Atlas) since Mal did mention that many clients want to keep their systems offline.

The size of contracts does look very small especially comparing with defence contracts. As long as FFT keeps a high gross margin, I won’t be worried about the price.

Lets see if the new platform developing be Rod could generate any meaningful recurring revenue.

Yeah I get the sense these announcements are more about saying "look, our new product is getting some early traction and with some notable partner firms too".

We need to see a lot more though, but hopefully each new install provides some important social proof and helps open doors to new customers.

Let’s hope it’s not Mal trying to boost share price. After all his performance shares are linked only to share price movement.