SenSen Networks - North American expansion boosts cash receipts

SenSen Networks (SNS) started its new fiscal year with robust cash receipts of A$2.6m, climbing 39% y-o-y. Boosted by multiple contract wins across the globe, management reported annual recurring revenues (ARR) of A$7.6m. Furthermore, management expects to approach an ARR of about A$10m by the end of FY23, and the A$600k from recently announced North American contracts should support that effort. SNS will also be implementing A$1.1m in annual savings starting in the current quarter to improve cash flows. These factors support our forecasts, and if SenSen continues driving ARR growth across multiple geographies and improves liquidity, we believe it could narrow the valuation gap versus its peers.