Prasad Kasinadhuni: Good morning, everyone. Matt will be here shortly.
[Analyst]: There he is.
Matthew Bellizia: Hi, everyone. Eric? Right. Good morning, everyone. We will just wait another minute or two to allow a few more people to join. Okay. It looks like we are stabilizing, so we might get started. Welcome to the Q1 FY27 quarterly activities update. I am the CEO, Matthew Bellizia. I will be giving the presentation along with the CFO, Prasad Kasinadhuni. Prasad, if you can move us along to the key messages, please. Right, we were cash flow positive for the quarter, which you can see through the 4C. We finished the quarter with AUD 11.2 million of cash, and as well as our further undrawn AUD 5 million facility, giving us a total liquidity of around AUD 16.2 million, again, with a debt-free strong balance sheet. Our revenue was up marginally to AUD 7.7 million. We have maintained our cost discipline.
Matthew Bellizia: We are continually doing substantial R&D in this place, which I will talk about in a minute, which we fully expense. We are not capitalizing the R&D, so all the R&D we have done over the last 12 months is expensed into the numbers. I continually talk about broadening the revenue streams to four revenue streams. We have the call recording business. I think we all know now that Verizon is due now, I know it keeps pushing back, but they are doing more and more piloting right now, so we are expecting that to go live in the first quarter of calendar year 2027, in the next three to four months. We are making good progress with them. Second revenue stream is our payments revenue stream. We are spending a lot more time on investing in payments. We have built it into the AWS cloud.
Matthew Bellizia: We are now spending more money on marketing and selling the payments business, promoting the payments products. The third product stream is our Dubber Notes. We have invested heavily in this product. We have a good product. People that are piloting love it, but we have not generated any substantial revenue off it yet because it has taken most of the year to build. We have had to update contracts with partners.
Matthew Bellizia: Partners are updating their contracts, but people love the product, and we hope that investment is going to start turning into real revenue very soon. Similarly, we have invested substantially in our AI development. So we have got a lot of voice AI that we have built. A lot of it is being piloted. We continue to get positive customer feedback, but again, in an R&D business, we have got to build the IP, we have got to change the partners' contracts.
Matthew Bellizia: The partners then have to change their SKUs in their business with the ability to sell it. Most of that has happened. So we are expecting to start to see the fruits of our labor coming through in revenue shortly. So it has been a year of investment, but we are hoping to start seeing some of these broader revenue streams start to feed on top of our existing revenue streams to broaden the business and pivot us into growth into next year. Next slide, please, Prasad. One more, please. We did a deal to acquire Daisee. Daisee has some fantastic customers, MLC, Ampol, Woolworths, some massive brands throughout Australia and New Zealand. Some really good companies. They are very strong in insurance and financial AI. Quite a sticky business.
Matthew Bellizia: The deal is we are paying AUD 400K up front, which has already been disclosed to the market, and then a further AUD 300K at the six and 12 month milestones anniversaries. If AUD 1.7 million ARR is retained after 12 months, a further AUD 250K in shares, which will have to get shareholder approval. Completion is progressing fast and is likely to happen very soon. Again, this plays into our four verticals.
Matthew Bellizia: We said we have got call recording, we have got payments, we have got Notes to go to market, and voice AI. This, again, strengthens our AI offering, which sits on top of our voice recording platform. There is a lot said in conversations. We are now untapping a lot more information to give to market to tell you what actually is being discussed in your business and things that you can action to improve your business. Real solutions.
Matthew Bellizia: As we get this stuff to market, we hope to get pretty good acceleration through next year on sales. Next slide, please, Prasad. To give you an idea of some of the things we have built, we have built sales playbooks. If you ring any organization, any company, and you speak to a salesperson, they ought to pick up certain questions. If you ring Dubber, who is your current provider? How many licenses are you interested in? If you ring up to buy a car, who is the car for? Do you have budget? Do you need finance for the vehicle? Sales playbooks allows you to define questions so you can start to measure, have your sales team ask the right questions. It gives them instant feedback. Objections are then raised in the sales cycle. You are too expensive.
Matthew Bellizia: Well, this is the best responses the company thinks that you should give to objections. This is too expensive. Well, your finance is too expensive. Well, we do not have establishment fees, convenience. There are certain answers. Again, we teach the sales guys that was the objection raised by the customer. There are two responses you did use. There are two or three you could have also used to help do it.
Matthew Bellizia: You ought to pitch it. You should sell the benefits of your company or the benefits of your products. We measure whether you actually pitched and you should be outcomes achieved out of a sales meeting, such as did you get an appointment? Did you get a test drive? Did you get people to a presentation? What is the next outcome? That is what a sales playbook is. We have built that, and that is getting close to release. It is in pilot.
Matthew Bellizia: Sales process looks at all the particular ways you try to close a deal. A direct close, which is would you buy this? An assumptive close, can I have the name for the reservation? A temperature check, which might be or a conditional close. If I match the price, would you buy? We measure the close techniques the salespeople tried to use, the customer's reaction. Did the customer react positively or negatively to that sales close technique? Which ones are working more effectively in your business? Which of your sales team are using which sales close technique, and what results are resulting from it? So you can coach your lesser sales team into improving based on the best sales team's performances. We have built a service and support workflow that tracks you through a service calls, different flows that happen in service.
Matthew Bellizia: Did you achieve the milestone through a service and support to satisfy the customer? Did this customer get satisfied? Was he reacting well? Did he leave the call dissatisfied? If he leave dissatisfied, let us flag to the service manager. Let us engage before you lose that customer. A Dubber Training Centre, so you can actually take the best sales processes, the best sales books, put the best calls in a training center. Your junior staff can learn by listening to the calls of the best sales staff, and that is the Dubber Training Centre. All this stuff is new. This is the stuff that is going to market. We are changing customers' contracts to support AI and these new SKUs so we can sell this stuff into next year. Next slide, please, Prasad. We have a new iPhone and Android app that lets you record.
Matthew Bellizia: If you want to record in-person meetings, you can pick them up. You can review summaries. You can see basic information about your last calls with those customers. Before you call them back, you can say, "What did I discuss with them last time? What was their main objections? How did I overcome them? Were they satisfied?" We have built business intelligence modules, which gives you graphs and stats.
Matthew Bellizia: You can see which staff are talking over other staff. You can see talk to listen ratios. You can see who is making outbound calls, how many people are making external calls versus internal calls versus personal calls. Are people driving the KPIs they ought to be doing in their businesses? We have email and app reporting modules that send straight to your email information pertaining to what you have been doing based on each of the things I just talked about.
Matthew Bellizia: People are getting live coaching at the end of a call. This is what you said. This is what you could have said. If there are escalations, we email managers so they can get involved. We have our Insights Agent, which is ask AI any question you want across your voice. How many people rang up? How many of my customers were dissatisfied last week? If you like that query, you can then schedule and say, "Each week I want to know all the complaints in the business. Send me an email of all the complaints." I hope this is making sense. Next slide. Daisee is obviously going to bring us some strong insurance and finance stuff, so that is another plug into our AI capability. I have talked about a lot of stuff being post-call, where we send you an alert.
Matthew Bellizia: Next year, we want to coach the people live in the call. If you get an objection, we are going to flag up. Here are some of the answers you can actually provide to the customer as and when it occurs. That is some of the stuff we have built, which we have not seen the fruits of our labor. I say to some of our investors, it is kind of like planting a field. We have planted the field.
Matthew Bellizia: We have put all the seeds in. We have fertilized it. We have spent 12 months paying for all this R&D. Little seedlings are growing. People look at what we have built. All our partners and early customers say, "We love what you are doing," but we are yet to harvest and see the fruits flow into the revenue. There is a bit of process, but that is where the business is heading.
Matthew Bellizia: I obviously believe in it because I keep buying our shares, and have so again. That is where the business will go, which is four revenue streams. Voice AI is a boom market, and that is what I think is going to rerate this place as we get this stuff to market. Next slide, please, Prasad. Some of the projects that we are currently working on. We are still moving Vodafone in the UK, our biggest customer, across to the Dubber platform, so that will rationalize that. They are launching new SKUs and new products in November, which will give them more opportunity to give us revenues. Verizon still wants to go live now in Q3. They are making substantial headway now. We are hooking up more and more live testing is going on, so now it is getting more and more real. The delays were not at our end.
Matthew Bellizia: They have been network based and telco, but we are looking in good place to go live with that. We are migrating out of the UK data center continuously, moving our payments customers from a data center into the AWS cloud, which we have invested in. That is going to drive savings. Plus, it gives better security and a better product that we can then take around the world because we are in AWS, which can be globalized rather than setting up data centers around the world. There is still more direct cost optimization to be found. We are still finding more things in AWS and Azure where we can save costs, so there is more work going on to drive down our direct costs. Our Dubber Notes and new AI launch I have talked about, and the recovery of funds is going on.
Matthew Bellizia: We are doing a little bit of discovery at the moment with the BDO case over the next month or 2. Then the case will be stayed, so there will be no more to spend in this business until the ASIC case goes ahead, and the ASIC case might take 18 months before they get BDO to court. But the good news for us is we get to sit behind that case, spend zero for that 18 months, and see what the outcome. If ASIC beat BDO, you would think BDO ought to want to settle with us. Across to Prasad for the CFO update.
Prasad Kasinadhuni: Thanks, Matt. Hi, everyone. I will take you through the numbers for the quarter now. Overall, we are pleased with where we have landed. Costs are down again. We have delivered another quarter of positive normalized EBITDA. Importantly, the business generated AUD 1.3 million in operating cash flow. Let us start with revenue. We finished the quarter at AUD 7.7 million, slightly up on AUD 7.6 million last quarter. Recurring revenue grew around 3% to AUD 7.3 million, and the exit ARR held steady at AUD 29 million. After the changes we have been through over the past year, it is good to see revenue stabilizing. From here, the job is to get to growing again, and the new products Matt just spoke about are the big part of that. Now to our operating run rate, which is probably the result I am very pleased with for the quarter.
Prasad Kasinadhuni: Revenue of AUD 7.7 million came in ahead of our cash base cost of AUD 7.2 million. That gives us a positive operating run rate of around AUD 0.5 million, up from breakeven last quarter. Our annualized cost base is now around AUD 28.6 million. That is a further AUD 1.9 million of annualized savings on last quarter. So the cost work we have been doing is now clearly showing up in the numbers.
Prasad Kasinadhuni: Direct costs did not move much this quarter. They were around AUD 2.5 million, in line with last quarter. The gross margin is held at 68%. There was a small uptick in AI compute cost, which is about AUD 21K, and this is due to the new trials products which we are trialing right now for our Dubber Notes and other AI products. We are continuously optimizing our cloud spend. Operating cash costs are where most of our savings have come from. They fell 10%, from AUD 5.2 million to AUD 4.7 million, which takes our annualized operating cash cost base to around AUD 18.8 million.
Prasad Kasinadhuni: That is the restructuring, supplier renegotiations, automation work all coming through. Also, we have identified further savings in the coming quarters. On EBITDA, normalized EBITDA was positive AUD 0.5 million, which is up from AUD 100K last quarter. That is three quarters in a row of positive normalized EBITDA. For context, if you look at Q1 FY28, we made a normalized loss of AUD 3.8 million. That is a AUD 4.3 million turnaround compared to Q1 FY25. It shows how far we have come in putting the business on a sustainable footing. Now to cash. We have ended September with AUD 11.2 million cash in the bank, which is about AUD 1 million more than at the end of June.
Prasad Kasinadhuni: On top of that, we have AUD 5 million loan facility that remains completely undrawn. So the total available funding for the quarter is at AUD 16.2 million, which is very strong. Coming to the actual cash flows, this slide shows the actual cash that came in and went out during the quarter. Operating cash flow was positive AUD 1.3 million, compared to a small outflow of AUD 100K last quarter. Customer receipts were strong at AUD 9.8 million, which is up from AUD 8.1 million from last quarter. Operating payments were around AUD 8.5 million, which is slightly higher than last quarter. This is due to some timing of annual prepaid expenses. What we can see is that better operating performance is now turning into cash in the bank. This is about normalized cash flow.
Prasad Kasinadhuni: If we strip out the AUD 90K for a one-off restructuring and recovery cost, the normalized cash flow is about AUD 1.4 million, up from AUD 200K last quarter. So the underlying cash performance of the business keeps improving all the time. To wrap up, it has been a solid quarter. Revenue has stabilized. Costs were down again. Normalized EBITDA has been positive for last three quarters, and the business is generating cash. A lot of work has gone in getting the cost base where we are today. The next step is growing revenue while keeping the same cost discipline. With that, I will hand over back to Matt. Thanks, Matt.
Matthew Bellizia: Yeah. Pushing forward, next slide, please, Prasad. Our new model, and as we have updated all the contracts, we are moving to a token-based model. In fact, we got a good compliment from the head of product of Verizon who said, "We think you have actually got one of the best models we have ever seen." That means as we go forward and once we have done all these contract changes with all these customers and put all the SKUs in place, updated all the marketplaces so people can buy through our token products, we can continually build more AI, continually put it in the platform. We have come up with a model where people can self-configure the options. They can turn stuff on, they can turn it off, they can consume our tokens, and they can spend more with us providing they are buying value from our product.
Matthew Bellizia: Our challenge going forward as a business is continually building purposeful AI. Stuff that is going to drive real value for business, going out to market, understanding what the customers want, building stuff that people want to consume, putting in the platform, and then it is easy to continue to build the business because people can just buy more and more tokens and enable more and more features. It really helps to scale globally as we go through this transition from fixed SKUs to tokens and just continually consuming more tokens, which is the AI market. Importantly, we also talked our partners into a much lower margin on tokens. They have agreed to that. Their margins were much higher, which was pricing Dubber out of the market a little bit on previous AI, and they have gone to much skinnier margins, understanding that the AI market is more competitive.
Matthew Bellizia: But we do have reach into 224,000 people getting voice recordings off Dubber who is readily available that could take our Dubber Notes products and our AI products as we go live. Focus in the next year, we will continue to have cost discipline. We will continue to drive down our direct costs. Once we see growth, once we get fully enabled and our notes and products are going to market and our AI is getting consumed, we have a good cash reserve to fuel the fire. We will throw the petrol on the fire once we see it starting to take off, which is more marketing, more sales team, and absolutely try and boost this business once we start to fuel the fire. We have gone through the process of R&D. We have built a lot of stuff. It is in pilot, positive feedback.
Matthew Bellizia: We are going through the contractual updates right now and the SKUs and the system, the system changes so that they can order stuff automatically through our products. Hopefully next year as we go through, this stuff turns into a real growth market coupled with Vodafone back selling and the Verizon products coming on. Let us now go to questions.
Matthew Bellizia: That is the end of the presentation. I will ask the first question. Why is your share price in the bin? I assume everyone wants to know that. Our enterprise value at the moment is about AUD 5 million, is not it, roughly speaking? Obviously, we have one of the institutions that are selling off our stock. You guys can guess who it is. They are selling off a lot of stocks around the world. Sorry, a lot of stocks in the small and medium cap. They were in the AFR yesterday selling off hard.
Matthew Bellizia: But until they are washed out, we just got to continue to absorb that sell-off, and it is just a particularly cheap stock. Our company is worth AUD 5 million with AUD 30 million revenue trading in the black enterprise value at the moment. That is probably all I can talk about in the valuation stakes at the minute. Any other questions? I am not seeing any unless my system is not putting them up. Are there questions coming through?
Prasad Kasinadhuni: Matt, can you see them?
Matthew Bellizia: I cannot see any questions.
Prasad Kasinadhuni: Oh.
Matthew Bellizia: Hang on. Eric is just coming to pick some up. Sorry, there are 15 questions. Sorry. I have now got the questions. Has Dubber, either directly or through ASIC's investigations, identified any significant assets held by the former CEO, including property investments, company interest trusts, or assets held through associated entities, against which Dubber could potentially enforce a successful judgment? Has the board received any investment of the approximate value of those assets, whether they encumbered and what portion could be realistically be recovered for Dubber shareholders? The answer is no, not really. The ASIC process, we are fairly blind to. ASIC do not communicate with us. We do not really know where their investigation is on investigating where the money went or who took the money. ASIC do not communicate with us at all. The only thing we are aware of is that ASIC is pursuing BDO.
Matthew Bellizia: In terms of the assets by the former CEO and others, well, we obviously know they have got some, but we have got a legal case against them. But until you win that, you cannot freeze them. And ASIC have not proven any wrongdoing on those people just yet. So, it is a difficult situation. I know it is frustrating for people, but we do not really have a lot of answers on that.
Matthew Bellizia: Has Dubber commissioned a forensic asset tracing investigation, including examining transfer to associated entities and third parties? ASIC has done all that. ASIC has had a massive investigation. Again, we are blind to what they have done, but they have had meeting after meeting. They have dragged everyone in. This is around 18 months ago, 2 years ago. Again, we are not really privy to what they have found. Now, we obviously, our former board commissioned KPMG to investigate that.
Matthew Bellizia: We're privy to a chunk of information, which is forming some of the basis of our legal case, so we can't talk about it much more. But again, we don't really know where this is up to. Does your system offer 2FA or MFA security for client accounts and systems? Absolutely. We're very secure. The big telcos that use us around the world push our security standards extremely hard, and we've got a lot of certifications. So certainly 2FA, MFA, and all that stuff's well and truly part of that. Has Dubber sought freezing orders or other asset preservation measures about the recoverable assets? If not, why not? Again, we did have a look at that.
Matthew Bellizia: The former board had a look at that and decided not to proceed on the basis that ASIC was involved, and we didn't again have enough. The guy's not been charged, so it's a difficult one. Based on information available to the board, is there a realistic prospect of recovering a proportional amount of the AUD 26 million of the former CEO and associated parties? There's another one. Is there annual revenue that Dubber can generate? This is the last question I'll answer on this one because I keep repeating myself. Again, we are pursuing BDO for AUD 26 million. So is ASIC. We're going to be stayed after we do discovery over the next month or two, and we'll wait to see what ASIC. ASIC have a ton more information than us. ASIC have pulled through. They have powers that we don't have.
Matthew Bellizia: We have access to information like any civil litigation would. They have a ton more power. So we need to sit behind their case and see what they find and hope your regulator does that. So maybe write to the regulator and see if they'll give you something, but certainly they're not giving us anything. At what annual revenue can Dubber generate a sustainable statutory net profit of AUD 5 million, assuming its current operating structure? Well, right now, I'd assume with growth, we would probably flow 30% to 40% to the bottom line from here. We're running at 67% gross margin, but as you grow, you've got to hire more salespeople, more support people, more engineers. So I'd say the answer to that is probably to get AUD 5 million to the bottom line is probably AUD 45 million turnover. Has the European business now stabilized? Mostly stabilized.
Matthew Bellizia: That was the one that was the hardest hit. Obviously, we lost Virgin Media. It's fascinating. We told the market we lost Virgin Media. Our share price went from AUD 0.037 to AUD 0.018 overnight to factor in that we lost AUD 10 million revenue. Of course, that revenue rolled off progressively over the next five quarters, and our share price kept getting punished as it went down on what we'd already told the market. But yes, it's substantially stabilizing now, and hopefully, we're starting to pivot more into growth as we launch more products and we go from defensive and call recording and suffering the pain from the shit of the past to launching new entrepreneurial products that the market should consume and the market's starting to say, "Hey, we like what you've got." How much revenue is currently generated specifically from AI products, excluding traditional?
Matthew Bellizia: The business has not been great at measuring that historically, the difference between AI revenue and add-on revenue. Certainly, our new SKUs are geared to measure AI growth, Notes growth, and I talk about the four revenue streams. As we bring them on next year, we are going to be able to report that on a lot more distinctively. I will not name the company, but have they finished selling off their holdings? How many do they have left? This is the institution that is selling off. I probably should not answer what I am guessing they have left. I do not really know because they hold their holdings in other companies. I have a back of the envelope guess of what I think they are holding off. Myself and others have got buy orders in today. We are continually absorbing them. I think it is a fire sale.
Matthew Bellizia: I am not just buying Dubber stock, I am buying the other stuff they are selling off as well, to be honest. When does North America carrier go live? It should be in Q1. Of the AUD 4.6 million upfront, how much is refundable or deferred? It is not refundable or deferred. Dubber's network has been standing up. We have been drawing down on a proper accounting basis.
Matthew Bellizia: This place is going to be run squeaky clean. There is no bullshit anymore. We are drawing that down over 60 months. It started from last January. They started paying us, I think it was on a five-year term. They pay us for the network and the services. Our network and services are standing up, so we are drawing that down into revenue on a monthly basis. The services that they sell go on top of that, and that is the flow on when they go live.
Matthew Bellizia: It is not refundable nor deferred. It is a contract for five years to hook up and supply network services. Do not forget, the investment they made in their network to support this is substantive. Millions and millions well above, I am going to guess, well in excess of AUD 10 million or more they would have had to put into their own network to be able to hook up the Dubber call recording. So a substantial project for them, massive investment, and they are starting to turn that on, hopefully, in Q1 next year. But the signs are good. They are certainly doing a lot of trialing now. Do you have any key contracts expiring in the next 12 months? Contracts do expire all the time, so yes, they do come up like any business and I guess you are asking me what I expect exposure to be.
Matthew Bellizia: There is probably one that I sit there and think April, May next year that I am hoping we will renew. There is certainly nothing of substantial nature like we lost in VMO2. The biggest partner we have right now is Vodafone. Vodafone is launching more SKUs. They have moved a chunk of their stuff onto our cloud. They are moving the rest of the stuff onto our cloud. They are going forward with us.
Matthew Bellizia: In the April webinar, you announced Teams Phone Mobile. What has been the uptake of that developed product? That has not been well taken up anywhere, to be honest. Not just call recording. Teams Phone Mobile has not taken up anywhere in the world. That was a year ago that Vodafone presented that at Mobile World Congress, Teams Phone Mobile in Dubber. But Teams Phone Mobile is not booming anywhere in the world. I have not seen it take off anywhere in the world right now.
Matthew Bellizia: Any guidance for FY27 revenue? No, we are not providing guidance at this point. Again, we have a lot of products going to market. I would love to get excited about them. I would love to go and spend recklessly on growth and hope that they went to market. As I said to you, what I want to see as a CEO, I have invested in these products. We believe in these products. I want to see the sales starting to take off. When I start sensing certain sectors picking up these products, we will fuel the fire. We have plenty of cash reserves sitting here that we will fuel when the time is right to drive that acceleration. For you to grow by, say, 20% over the next couple of years, what would you expect profit to look like? I think I have answered that one.
Matthew Bellizia: I would expect AUD 0.30, AUD 0.40 to flow to the bottom line of our growth now that we have reset this cost base. Sit with 60%, 70% margin, but assume AUD 0.30 or AUD 0.40 on the dollar would go to more sales team, more marketing, more support staff, more engineering to continue to invest and continue the growth. When do you expect revenue to come from Verizon?
Matthew Bellizia: I have covered that. Say revenue is AUD 40 million, I would expect EBITDA to be around AUD 3 million or AUD 4 million. Can you estimate the R&D cost absorbed in the P&L for the new product development? Yeah, I would say we have probably spent, I do not know if I get in trouble for these guesses, but I would say we have spent a couple of million dollars this year in R&D on these new products. What are your expectations for the magnitude and growth from revenue from Verizon?
Matthew Bellizia: I know what they are forecasting. What is positive is we are signing a change to their contract right now to support the AI SKUs. That could be even greater. Do I really want to turn up? One thing I have not done to you in 2 years is turn up and promise the market anything. I have been pretty straight. I have been pretty honest. I have not really given any false promises.
Matthew Bellizia: I have not really pumped the share price. In fact, I do not even have investor relation companies at the moment. As we go into next year and we can start to really see the growth, I think then when I can actually not just go on promises, which this company used to bullshit you guys with promises. When I really see real traction, I can actually start to put my hand on and say, "I can trust that trajectory.
Matthew Bellizia: I will give you forecasts, and I will give you forecasts that you can trust and believe at that point." Other than that, I will keep credibility. Next year, I will probably bring a lot of investor relations back. When I start to believe that we have gone from suffering the pain of the shit of the past to seeing the fruits of our labor and the investments of our R&D turn, we will bring back investor relations.
Matthew Bellizia: We will promote the share price. We will promote the business to investors. That will be the time that we do it. We do it with credibility because we have not bullshitted you to date. We have kept ourselves credible, and we will continue to do that. Righty-o. Thank you for your transparency. Looking forward to the next year. Can you talk to the share consolidation? Yes. Our shares, listen, what looks stupid is our share price of AUD 0.01.
Matthew Bellizia: They are AUD 0.005, AUD 0.006, AUD 0.007. People look at that and do not understand that we have 2.7 billion shares on offer. How did we have 2.7 billion? We did an emergency AUD 25 million capital raise in around April 2024. We then did another AUD 25 million emergency capital raise, or maybe not emergency, in October 2024, where we issued another 1.6 billion shares, I reckon we issued.
Matthew Bellizia: I am guessing this, guys, so do not hold me to it. That pushed us out to 2.7 billion shares when we raised AUD 50 million in 2024. It is crazy. So a 50 to 1 share consolidation pulls us back to around 55 million shares. It will bring the share price back to what? Right now, it is going to be about AUD 0.30, AUD 0.35, AUD 0.40. It depends when that company has been washed out, that is flogging off hard.
Matthew Bellizia: There are some opportunities around the market right now based on their sell-offs. I think that just rewrites our, puts our share back to more credible things because customers look at that share and say, "Well, hang on. Do I want to do business with a share that is under AUD 0.01? They are a penny stock." It is not the right credibility. In hindsight, I wish we had consolidated a year ago. I was probably talked out of it at the time. They said, "Well, you are losing money. Do not share consolidate because you will drift backwards again." I think from a credibility point of view and a cleanup point of view, it is neater and tidier that we actually brought ourselves back to a rational amount of shares that a company like us should have.
Matthew Bellizia: Is your average recurring revenue of existing clients a concern for you and you are working towards improving old existing clients? We are continually working on confidence with the clients. I have spent 6 of the last 8 weeks abroad. I turn up to the clients, I tell them the vision. I tell them where we are going. They know we are being honest. You know what they keep saying? "You keep doing what you say you are going to do. Your results keep coming like you say you are going to be." I have told them we are going to be stable. I have told them we are going to retain at least AUD 8+ million in the bank. We keep beating expectations. They keep on believing that we are delivering on what we promised. So that creates a lot of stability over the 12 months that we have done what we have done.
Matthew Bellizia: The customers say, "Well, you are investing in product, you are investing in R&D, and you are taking us on a journey. We are not stuck in the past. You are taking us forward." Yes, we had shutters that happened in 2024, and it takes a year to do a tender and a year for us to lose customers, which we have. We all know about and we have suffered. Notwithstanding, we have suffered nearly 10% losses through FX as well because we are 94% offshore revenue. Now, that is not helping us that our interest rates go up Tuesday, and the US holds constant on interest rates, but that is cyclical and hopefully it swings back the other way, and we pick up our 10% revenue loss on FX at some point.
Matthew Bellizia: Are you looking for a new board member following John Selak resignation? Are you able to summarize your senior leadership and their roles? Rob, Ben, Giles, et cetera. Rightio. So right now, because I am a scumbag, I am happy to stay with four directors. At some point, if we had a strategic person that could help us grow the business, we would look at them. So if we found someone strategic around the world that could join our board or someone that was going to take a material stake, I think it would be interesting.
Matthew Bellizia: But right now, I am happy with the savings and so forth. Senior leadership, we obviously have a leader of each region that runs each region and tries to grow each region. We have a head of marketing, we have a CFO, and we have a CTO. They are my main sets of reports through the business. What markets are you seeing the most growth in US, and what is leading that? Traditional recording.
Matthew Bellizia: US is having a pretty good month this month, to be honest. Probably the best I have seen. Right now, yes, they are selling mostly on recording revenues because right now we are doing free trials on AI and Dubber Notes. People are loving it, but we cannot transact it, so our direct costs are a little higher than they should be because we are paying for the free trials.
Matthew Bellizia: Hopefully, as we start to get the contracts on, the system is hooked up so they can automatically provision Dubber Notes and our new AI, that will come on. But the US is our main growth market at the minute. The UK, funnily enough, it is funny when you look what happened in this business in 2024, the US market did not seem to give a shit. They are just like, well, we have seen companies go broke. They go into Chapter 11, they come out the other side.
Matthew Bellizia: What is the big deal? The UK is the one where we suffered greater pain through and more shutters around, well, what does it mean that you are in the trading halts for a couple of months? Are you going to be stable? Are you going to get out of it? Should we take some of your business away and have two vendors? The US seemed to be pretty unfazed about it all, but we are mostly through all those woods because for the last 12 or 18 months, 2 years that I have been here, I have talked to the market, I have talked to the customers. We continue to deliver.
Matthew Bellizia: So I do not see people that have not made a decision to leave us leaving us now. I think we are suffering from what happened in the past. That is now onwards and upwards about where we go. Can you disclose how many employees Dubber currently has compared to 2 years ago? Software, engineering, product maintenance, and support. The answer to that is, I love engineering. So we have stripped back a lot of people in HR, in product.
Matthew Bellizia: We have reduced our finance team because we automate a lot of the invoicing to go as straight automated invoicing processes. We have done a lot of internal automation in our business. Engineering, we do not touch. If you are an engineering company, you have got to build bloody good product, you have got to have good customer support, you have got to deliver it, and you have got to sell it. We have stripped back our sales team as well because we sell through indirect channels. I thought it was stupid that we are paying indirect sales channels and we are paying for salespeople. Why are you paying two lots of sales channels?
Matthew Bellizia: If you are using indirect, run them efficiently. If you are going to sell direct, have KPIs on your direct team, and I thought there were too many people. What flushed that out for me is I put Dubber Notes, our own product, on our own people, and I found most of our sales staff around the world doing external calls for 1 hour a day. So if they are working at home and only doing 1 hour a day, what are they doing for the other 6 hours? That is what I started to pull apart. Why do we have so many people? Which is great because our story of how we rationalize our business by using Dubber's own products shows the return on investment we got, and this is what our customers are going to experience too.
Matthew Bellizia: Can Dubber realistically maintain support, continually improve, commercially develop all these?" Absolutely, we can continue to maintain and invest in product, and we are going to continually invest in new engineers and better engineers. Do not forget, a lot of your software is now built by Claude and AI and more automation. So companies like us can build more faster, produce more software using Claude Code, other software techniques, AI, and build it more efficiently and effectively. If we are going to compete in the AI space, we have to build AI and do AI more effectively than everyone else as well. We are in competition. Just a comment. "You are not a scumbag for keeping a lean board." Well, I like to keep our costs in, and I like to keep value and invest in the areas that create growth and value for this business.
Matthew Bellizia: We invest in IP, we will invest in the right sales team, we will invest in results, we will invest in accountability and growth. I am a big believer that people do business with people. I want a sales team that people like, people want to do business with, people can trust, honest ethics, and good product. You win technology by having the best product, the best IP, having the best people selling it, and then evolving it. The fact that our model allows you to enable and disable features means we continue to build features, push them into the product, and our customers will just continually see new products. We complement that with good marketing and sales engagement, and that is our model for growth next year. I think that is the whole list of questions. I hope I answered them clearly for everyone.
Matthew Bellizia: I thought this was going to be a short presentation because we put the 4C out early, but we are already 45 minutes in. Are there any further questions? I will give it another 30 seconds. If there are no further questions, we will wrap up. Good stuff. Thanks both. Thanks. Very good preso. Timeframe for share consolidation, the AGM is on 25 or 26 November, and that should happen around mid-December, assuming the vote goes through on the share consolidation.
Matthew Bellizia: Any further questions? All right. If there is nothing further, we will wrap up. Thank you for everyone for attending. We will continue to work hard for you, push hard with this vision, and hopefully all the fruits of our labor, we will be harvesting all the stuff that we have been seeding for the last 12 months, and hopefully this IP goes out and can turn us into voice AI companies. Look at the valuation of these voice AI companies that we are going head to head with. Incredible versus our valuation. Thanks everyone, have a good day.
[Analyst]: Thank you all.
Operator: Goodbye
