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Sector: Technology and Telecoms CyanConnode (CYAN): FY 2018 revenue on track with new regions opened Key data Share price (p): 11.3 Target price (p): U/R Market cap (�m): 14.4 Enterprise value (�m): 9.0 2017 results are largely as expected after January�s trading update. Affected by a delayed delivery, revenue fell 36% YoY to �1.2m contributing to a cash loss of �10.7m. R&D spend increased during 2017 with development of a new standards based product which is now complete. Cash at the YE was �5.4m after an �11.3m equity injection in the year and we calculate current cash of under �3m but with a further �1.4m due from R&D tax credits. The cash burn will be reduced during 2018, and whilst there is no visibility on the Bangladesh order, new territories have been opened up and a large order for $3.2m in India is announced with the results. The cash should be sufficient through to Q4, when the bulk of the year�s �10m expected revenues are due to be booked. To be prudent, our forecasts do not include anything from Bangladesh and little from Iran; however, delivering them will require additional working capital (our forecasts assume �2m from equity) with a number of sources being considered, including licensing. The uncertainty on timing and funding means this remains a highly speculative holding and we place our TP under review. We do see opportunity in a huge order book and strong IP; also a shift of emphasis from hardware to software with a licence and royalty model for the new product developed during the year. Lorne Daniel | ldaniel@finncap.com Interesting the forecast of �2 million equity needed, and the �10 million expected revenue In Q4

They did mention the possibility of a licencing deal as one of the options for future funding .. "We continue to work on securing additional funding that will be required during 2018, especially as we start to deliver on orders which are expected to require upfront working capital investment. This funding could include one or a mix of working capital facilities, strategic corporate investments, additional equity funding and licensing deals for our new Omni IoT platform. We remain grateful to our supportive shareholder base which has funded the Company to date, including the two fundraises from last year.� They also mention somewhere else they are presently in talks regarding licensing. ...if it's going to add to the fundraising then must be imminent.

No matter what perspective you take... there is no escape from further funding, probably dilution, CC will need money to keep going and to fund any growth and how this will be achieved will be shared after the next RNS imo If CC require significant yearly funding now ....when they only have a few, small ordes to fulfill. ..what sort of funding will they require if and when the big orders are required to be delivered. ....I can't see how CC can avoid further dilution .....it will take a mega order to land soon, with part payment up front. Can a licencing deal achieve that in next few months?

No mention of Iran or Bangladesh.....Iran got a posative mention, a full paragraph in the trading statement five weeks ago ? not even named today!

I actually feel sorry for the BODs of CC at this particular moment in time...we were told recently that business with Iran was still in play. However, these events have given CC a real dilemma ( Along with many others). They can't ignore them in the results which are due .....yet, from the look of the situation....if they continue to trade with Iran seems like risking business \ contracts / partnerships already in place. I Rembrandt when the Iran deal was announced in 2016 ...the sp doubled over at week or ten days or so...one if the best weeks invested here...the truth is they will now have to announce its possible termination, surely. ..they have a few months to get out but the ramifications on other contracts if they remain trading with Iran must take priority... I wonder what advice, if any their getting from advisors....this one is not CC fault it's just very bad luck.....saying that I still can't find anything on Our partner in Iran.

Here is one good example : Tata ...could easily be L&T or one of the othe CC partners. Tata are well embedded in US as can be seen here as are L& T http://www.tata.com/tataworldwide/index/Tata-in-North-America Tata in 2016, once sanctions relaxed ...announced they were to take on the one and only main Iranian car manufacturer by 2018. Today this initiative looks doomed just when they have introduced three new , low cost models aimed specifically at Iranian middle class .. They will now surely have to withdraw. The question is if Tata withdraw from Iran due to secondary sanctions, which is likely as they risk their business in US plus fines ....but continue to do business with CC in India, ( at the same time CC continue to trade with Iran...via CC India PVT.....).....then what will happen I think is that this will be picked up by the US via tracing financial transactions .......they will only be allowed to Use one country's ( US or IRAN) financial banking system ...they, including those they do business with, Can only touch one live wire ....the US banking wire or the iraninan banking wire and that also includes their subsidiary's and business partners ......if they, or any subsidiary or business partners touches the Iranian banking system wire ....then their in the sh**. At present Tata can easily do Business in US and India, along with CC and make payment to the bank of CC Pvt. However, if the Bank of CC Pvt. Is touching the Iranian financial wire in way of payments with or from Iran etc then both the Bank of CC Pvt. Along WithTata will be punished....I think the banks involved will be first to react and refuse to represent company's doing business in Iran as they will be punished. ....talk of 100s of millions of dollar fines, for each breach plus loss of US business..Just my opinion.

This explains it well " How should compliance officers respond? The response should be to assess how these reimposed measures will affect their existing business and take steps to address the changes, either through ceasing certain activity, or putting in place procedures to make sure transactions subject to sanctions don’t occur. For example, if your foreign subsidiary in Dubai is doing business in Iran—as they are now allowed to do—make sure they are taking steps to wind down the business within the time frame that is required. Another thing that companies need to be aware of with this change in the law, is that they need to be very careful about their counterparties who are non-U.S. firms who may still be doing business in Iran. You could find yourself in a position where you are facilitating a non-U.S. business in Iran. That is a risk." https://www.law.com/nationallawjournal/2018/05/15/5-of-the-biggest-compliance-questions-about-renewed-iran-trade-sanctions-answered/?slreturn=20180420095319

Hi all, Tony. What's very unclear at this stage is to what exteNt will the US embargo reach ...there is "just" talk at the moment of secondary embargoes on company's doing business with company's supplying Iran. If this CC did continue trading with Iran and these secondary embargoes were put in place ...( which would be faround more effective) how would this effect CC present day partners. ...and what penalty would they have to endure just to continue partnering with CC. Many of our partners trade across the world including US. We could end up being the Billy no mates of smart metering ...even if we did trade Iran from India....may never happen of course but does make you think about the longer term consequences if this were to happen....

Let's hope so Multi. As far as Iran is concerned I guess this crisis will present opportunitys for the brave .....reduce competition etc but I don't think it looks very promising. The US Are saying companies with existing contracts will have 90 to 180 days to extract themselves from their Iran dealings before becoming subject to penalties. This quote below Makes an important point, I think. Meark shipping and Total Oil have recently announced they are getting out. �Which company is going to risk access to the U.S. market, which is 100 times larger,� Ardavan Amir-Alsani, a Paris-based lawyer who specializes in Iran, said in an interview. �No one will choose Iran over the U.S. The deal is dead.�

No Tony....Stedon. IRONTART's wife , myself and possibly Sage are going to invest all our money in converting an old pier out of recycled Smet 1 meters and evey night at high tide ( or whenever it is) it will transform into a solar powered ww2 landing craft and will transport up to 50 japanese tourists onto a beach near Sages house..where he will delicately BBQ English Japanese fusion sushi using his secret ingredients of frozen fish fingers...the craft will be crewed by delinquent teenagers sentenced for upto three years each and will remain on the pier / boat at all times..... Stedon will be captain. ...as he can get a discount on the fish fingers and owns a white cap.... Anyone wishing to invest contact Stedon and for each 5 grand investment you get to take a private trip ( max 50 people _ as the boat only holds 30, and we are short of life jackets and oars). We will probably reverse the boat into a shell a long time before we make our first trip...but do expect a turnover of around £10 - 15 million a year from boat number 1..most of it drugs and arms running but good profit could also be made on the finger sushi...

STEDON I know at present your team is quite small ( just you and Mrs Irontart) but the good news is I've found you the funding....the bad news is you may have to alter your original idea a little 😧to be able to access this money.😃 https://www.gov.uk/government/collections/coastal-communities I think you should regenerate an old pier!! But one that can be launched our to see as a boat ....a bit like the old 2nd WW landing craft....you can still keep Mrs Irontart on board as jead of security....just an idea. Don't bite my head off. I'm going to have to do some work now....before I take lunch .

Look up Coastal community's fund Big Lottery funding. ...they fund all sorts of coastal initiatives. What about setting up a crab farm. ..! Or a Butterfish farm...somewhere exotic like Cornwall lol If you make your boat out of recycled materials (such as other old boats or Smet 1 smart meters) ..your defo get funding....You will hit all the latest buzz words. ..youth, recycling, heritage, tourism, ..stick a solar panel on the roof and you will be able to say you save energy with your solar powered kettle. Irontart has already found you the sea monster...so your half way there ( iron...hope your other half don't snoop on your posts, or else your be walking the plank.)

Just had a peak at the Investor chronicle magazine in wh Smith ..KMK .been tipped with sp target 34p. ...this would explain the share price increase ...if i could only get a job at the printers that print IC .....I would be a very rich chap and only need to hold shares for a few days at a time... Avoiding any risk... imagine reading the share tips each week a few days before magazine distributed....mentions US could be worth 20 city's x $10 million per city.....£13 million in bank ! Likely takeover imo

https://www.metering.com/industry-sectors/iot/iot-mesh-devices/

Nice name johnny ..one thing is for certain ...you will never need to withdraw lol

Hi Tony. On the face of it ..it's not good news but if CC are allowed to trade via india pvt ...then will be far less competition in Iran so in theory more opportunity for CC. The down side will be the introduction of secondary embargo which is expected ...which will stop any US company not only trading in Iran but Also stop them doing business with any company that is seen to be trading with Iran. ...not good news for any partnerships with US companys worldwide. .. News night interview last night summed it up well I thought when a guest said most company's doing business with Iran. ..only accounts for a fraction of their business compared to doing business in US...so many European company's may well follow Trump's line just so can continue doing business with US....cc don't do business with US as far as I know so not so much to loose, I guess....also take into account who is paying for the smart meter investment in Iran...and what influence the US will have with them, will they turn off the funding...it's an interesting development which only makes everything even more confusing than before. I'm petty sure CC are conducting business with Iran via their indian company...just not sure how far that protects CC from being blacklisted by the US if and when we started trading with Iran.

What's with the share price Today? Yesterday Trump pulls out of Iran deal and I expected a drop but the sp went up.......yet, today on same news we drop....is it Iran or something else? That spread has been all over the place today 12, then 4 and now 9....

Sorry, closed today....not sure when will be opened.

I'm assuming the previous link relates to the "Procurement of Supply, Installation, Testing and Commissioning of Smart Pre-Payment Meters including related services" tender that was due to be opened Today...but can't find anything further.

https://www.dhakatribune.com/business/2018/05/05/dpdc-install-smart-grids-first-time-bangladesh/