1.

Capital Structure

After both tranches in placement which was done at $0.05.

Shares on Issue: 141,060,417 including escrow.

At price of $0.055 your market cap = $7.7Million

Cash at hand = $2.3Million

Receivables and ST Liquid assets (Incl. Cash) = $3.3M

Payables and ST liabilities = $2.4M

Enterprise Value = $6.8Million

Trading on an annual basis 2.4X Revenue and 3.8X Gross Profits.

2. Management/Register

Management as far as I know aren’t top tier X-Factor entrepreneur’s like Vaughan Bowen on UWL. But they quietly
get the job done and can potentially create growth.

Just some brief notes on management;

Fadi Geha – Running the ship. His previous deal was Viewlocity where he was VP to head the expansion strategy in
2003. Was acquired by Fujitsu in 2009 for $48M.

Phillip Tye – Hedge fund manager and has had hedge fund positions in multiple quality businesses.

Ben Loiterton – N/A.

Fadi holds 12M shares and he’s adding another $100K in placement. Fadi will have 10% of shares on issue. Phillip will
also be adding another $100k in placement tranche 2.

I’ve asked a (fairly tech cynical) friend who’s caught up with management a few pointers on what he thinks. I’ve been
informed they are very business focused however the downside is they have made promises before of growth at IPO
and failed to deliver. I think others should be aware about that.

As per annual report, management are very aware they failed as an IPO and there was a need for restructuring of
expenses. Since mid-2018 they’ve been focused on just cutting down overheads and running a tight ship. They feel
they’ve executed on that – and I feel the same. Now comes the part where focus is moved to major U.K expansion. If
they’re successful in executing this (without blasting overheads again) it’s a multi-bagger. Of course, there are huge
risks with betting on a turnaround and “expansion” strategy early, which can often fail. That’s where one must
consider their personal Risk Vs Reward appetite.

PAC Partners and Patersons Securities managing the raise, Canary Capital also subscribed to a bunch. The broker
from PAC most recently did the ADN raise which did 7bags in 6months from their placement and 15M options well in
the money so likely his clients will hold on tight for another potential multibagger. Patersons have done well with a
handful of placements, looking at their last three tech placements; 9SP did one bag so far, MEM did three bags in a
month from $4.2M placement ann., NXS (biotech focused) did 4bags from IPO led by Pattos.

Of course it is a bull market so every broker is doing well irrespective of how well they manage the book or asset, so I
don’t think too much of it but its an added bonus especially following on from the ADN run.
 3. Business

Provide smart meters both on software and hardware with mobility suite. Allows SME’s to automate, mobilise,
monetise, control and visualise their operations and provide better energy and asset management.

The part of the business that interests me at the moment is there energy management system. “Simble’s energy
management suite enables grid-connected premises to reduce energy wastage, automate control of their switch
circuitry and monetise surplus microgeneration capacity. Our suite of energy management solutions is principally
catered towards enterprise and SME markets across a range of industries including retail, healthcare, utilities,
construction, hospitality and industrial customers.”

A few things I like about the business, management isn’t overly promotional but proactive enough to keep market
updated with newsflow, contract values are attached to every deal they make, large market potential – I’m not
talking about global market but generally the market they have access to from strategic partnerships, so it can be
realistically tapped into. The numbers are growing both on hardware and software, great margins, not labor or
hardware dominant so its scalable, management are wary on expenses and don’t blow on lifestyle they are actively
cutting costs and trying to push into cashflow positive, 75% of current revenue is recurring with new contracts
commencing should tick up the revenue figure.

Snapshot of their quarterly business statistics provided on next page. Directly below attached is a chart of their cost
cutting and booked revenue. Its reaching the critical stage of moving into positive cashflow.

Attached also is there customer base growth which has begun moving exponentially. With two major contracts
commencing in Q3 this figure should increase.
Here are the business stats; brief explanation

• Annualized valuation is simply if they repeat current quarter’s performance. Rolling valuation is the last four quarters performance. GP is gross profit.
• Given its growth I feel annualized valuation is more appropriate. At 6cents trading 4.73 times Gross Profits, 2 times Revenue. Usually anything that trades under 7
times gross profits with good margins has my interest. Of the last 5 quarters they average 60% margins which is exceptional, and usually standard for SaaS
dominated business. Overheads has been reducing which is aligned with managements cost cutting plans.
• They $1.027M revenue figure came from the following calculation:
- 75% of revenue is recurring. Assume 75% of that $700k revenue this quarter will re-occur next quarter. As per Page 2 of quarterly, deployment of the
$750k contract over 12months will begin deployment Q3 this equates to additional $187k/qtr. Deployment of $6.4M contract commences Q3 over 3-
year period which equates to $530k/qtr. Discount both these deployments by 30% for risk/scaling/late receipts the company should receive $1.027M
revenue and will mean it will trade under 3 times gross profits and under 2 times revenue.
• Assuming a 60% margin, a slight increase in overheads they should be close to cashflow positive. With cashflow positivity potential being reached in 2 quarters.
 4. Potential/Peers

This is the X-factor part, more subjective and less statistical.

• Direct market potential

Currently they have a contract with a U.K confectionary manufacturer valued at $750k for 450 Simble Energy Bundle
to be deployed over next 12months for $750k. A contract with RATP lead bus operator in London to include SIS
systems in all 13 garages.
However the real value add is the agreement with U.K Energy Broker, UCR.

$6.4M revenue will be directed to SIS from the contract and is to be delivered by BID/SIS partnership over 3-years for
10,000 smart energy meters to be connected to SIS software and hardware platforms. The contract has potential to
move to 60,000 meters quite quickly which should significantly boost revenue. UCR has also recently been appointed
as non-exclusive distributor for UK Energy Market bringing their total meters under control to 250,000. SIS have
contractually secured 10,000 of these, with discussions to expand to 60,000 with greater market growth opportunity
to 250,000 in future.
SIS expect monthly revenue to increase by 6-figures upon rollout. With rollout commencing Q3, should bring
aggregate $530k/qtr ($6.4M split into 3-year term) which aligns to approximately $176k/month “monthly six figure
income stream”.

BID also has a strategic partnership with SIS to provide a whole lifecycle bundled solution. BID will allow SIS to tap
into their clients for further value add. BID as per announcement on 04/06/19 manages 127,900 meters. If they are
able to convince 10% of their clients to include SIS platform as a value-add, that’s 12,000meters which should be an
additional $4-8M revenue for SIS depending on scope of works – and using the 10,000 meter $6.4M UCR contract as
guideline.

• Second potential is re-rate. Their closest peer and partner in providing Smart Energy solution is BID. On an
Annualized basis BID is currently trading 12x revenue, this is even after the fallout with the board and
governance issues. Of-course BID has better tier clients, a more dependable income stream, larger market
share and presence but SIS continues to trade under 3x revenue with aggressive growth potential which
seems a significant disparity.

• Last point on potential, and kind of a far reach so take it with a grain of salt. But there is an ethical
environmental value add with SIS solution. Market may pay premium for this, and for those that do back the
EV revolution and electric charging station all should be equipped or have potential for smart meters.
 5. Technical

Definitely not the best after today’s action but I guess that was normal across the board after DOW drops -3%,
people dumped but it continues making higher lows, at trend line. Usually after panic there’s usually a solid bounce.

6. Risks
• Delayed revenue, if they are installing all through this quarter and rolling out smart meters until quarter end,
cash receipts will not be audited and booked in for following quarterly. Which could lead to a disappointed
market reaction, however should move into receivables and booked in following quarter.
• No new contracts coming in from BID or further contract scope expansion from UCR which will stunt high
growth potential. Basically, a failed execution of expansion strategy.
• Jump in OPEX and overheads while undertaking these new meter contracts. This may delay Cashflow
positive achievement. Furthermore, high overheads can burn through their cash faster and lead to further
dilution.
• Drop in margins from undertaking new roll out and installation of hardware of Simble energy systems across
UCR, confectionary and bus transport contracts.
• Further governance issues with key strategic partner BID.
• General market risk – crash, trade wars, deflation, inverted yields, cooling off XEC, XJO at top of weekly
trendline.
• Liquidity risk, can be choppy.
• Supply may come in from recent placement done at $0.05. Another $600k tranche 2 placement due in
4weeks in which $200k is taken by directors leaving an additional $400k new supply.

7. Highlight Summary
• Under $7M EV trading 2.4x annual revenue, and 1.6x expected annual revenue. With closest peer and
business partner trading 12x annual revenue.
• High margin business averaging 58% profit margins last 5 quarters. Management actively cutting expenses to
move towards cashflow positivity.
• Directors adding $200k in recent placement with significant skin in the game. Now cashed up for expansion.
• Q3 commencing rollout of $7M UCR contract and $750k Confectionary contract.
• PAC has had great success with ADN, AGH, CAN, OCC and more recently PMY emerging. Same broker from
PAC managing placement on SIS as they did with ADN. Pattos have done well recently on 9SP which was
their recent tech play and before that it was NXS and MEM which both did about 3bags from placement
price.
 8. Disclosure

Nothing I say should be advice. I get more wrong than I do right. Just assume this is all fictional humor and don’t take
advice from strangers online in general.

I’ve been a buyer between 0.06-0.068, I’ll probably offload some (hopefully) at double digits, but really it’s too early
to tell, this is just a thesis and I will wait for management to execute and keep up to date with the business and
adjust sentiment/position accordingly.