Seeing Machines Share News (SEE)

(Sharecast News) - Computer vision technology company Seeing Machines updated the market on its operations on Wednesday, reporting that its automotive supply chain had been strengthened through a renewed supply agreement with Xilinx.
The AIM-traded firm said its FOVIO Driver Monitoring Chip strategy had been bolstered by a renewed supply agreement with its chip supply partner, Xilinx, with the chip currently committed to three ongoing automotive OEM programs - two in North America and one in China.

It said the agreement would see Xilinx now supply the FOVIO Chip directly to Seeing Machines' automotive Tier 1 customers, which was expected to reduce both supply chain qualification complexity and realise related cost savings for customers and eliminate the supply chain risks and costs associated with direct supply of the chip by Seeing Machines.

The company, through Xilinx, would remain the sole provider of the FOVIO Chip solution for the automotive industry, adding that it expected the chip would continue to appeal to customers looking to deploy new driver monitoring systems quickly with "minimal" integration risk, thereby enabling advanced driver assistance and safe semi-automated driving systems.

In order to leverage its driver monitoring technology across aviation and fleet, and enhance the products and solutions currently offered in those markets, Seeing Machines said it retained the right to procure FOVIO Chips directly from Xilinx at previously-agreed commercial terms.

In its fleet operations, Seeing Machines said it had worked with its Guardian manufacturing partner to reduce the manufacturing cost of the commercial vehicle driver monitoring technology.

The Guardian unit hardware cost had been reduced by 21%, the board said, which was expected to deliver savings of around AUD 8.4m on its upcoming negotiated volume order, which was set to be delivered in batches to Seeing Machines and its channel partners over the next calendar year, to meet expected demand globally.

Seeing Machines said it was currently channelling 70% of Guardian sales through a "growing network" of distributors.

The company said it was also working closely with insurance companies in Australia and Mexico, adding that it was in advanced conversations with others in three additional geographies.

Those insurers had either already endorsed Guardian as the preferred safety technology for commercial fleets, or were looking to do so, where mutual customers became eligible for insurance policy benefits and financial incentives.

It said Fleet Complete, a global provider of connected vehicle technology, had been appointed as a Seeing Machines value-added reseller to focus on oil and gas Industry opportunities in Australia.

That segment was now opened up to Seeing Machines directly, as a result of recent negotiations with Caterpillar, which saw the company regain the right to sell directly into additional fields of use.

Fleet Complete had more than 33,000 connections in Australia and 500,000 globally, it explained.

Seeing Machines had also signed an additional distributor in Turkey, AUSIS, which it described as an existing telematics, fleet management and Mobileye reseller with installations spanning a range of multinationals across the country.

AUSIS viewed the Turkish opportunity at more than 1,000 commercial truck and bus fleets and around 50,000 individual vehicles.

Finally, Seeing Machines said Toll Group - part of Japan Post, which had already installed more than 1,300 of its Australian fleet with Guardian - was continuing to deploy the technology across all vehicles over 4.5 tonnes.

It said that opened up additional opportunity for Seeing Machines to a total of over 4,500 Guardian installations in Australia alone.

Initial installations across Toll's international locations had also started, and were expected to continue, in line with the move to seek to standardise Guardian across its entire operation.

"I'm delighted with the progress being made across the business," said chief executive officer Paul McGlone.

"Our partnership with Xilinx has been nurtured over several years and our renewed agreement for supply of the FOVIO Chip directly to our Tier 1 automotive customers seeks to leverage the particular strengths of each company to their benefit and that of our customers.

"In addition, we believe the outcome of our negotiations with our manufacturing partner, coupled with the strong momentum across the fleet business and the strengthening relationships with distributors and other partners, will improve the division's profitability and cash flow, and will also help fund the company through to profitability."

McGlone said the company was continuing to work with aviation partners to develop commercial relationships to accelerate mass-market opportunities for its crew training system.

"Our strategy is now set in three major transport verticals - automotive, fleet and offroad, and aviation - each with a "significant" growth trajectory and a refined business model.

"Importantly, this provides diversification in cash generation and minimises risk around timing, segment and customer concentration."

As at 1626 GMT, shares in Seeing Machines were flat at 4.62p.