CLUEY LTD — Interim / Quarterly Report 2021

Jan 21, 2021

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ASX Announcement

Friday, 22 January 2021

Appendix 4C and Quarterly Activities Report October – December 2020

Cluey Ltd (ASX: CLU) (“Cluey” or “the Company”) has released its Appendix 4C Quarterly Cashflow Report and Quarterly Activities Report for the period from 1 October 2020 to 31 December 2020.

Cluey was admitted to the ASX on 9 December 2020, however the activities for the full quarter are included. Cluey will report its first interim results in respect of the half year ended 31 December 2020 in February 2021.

ENDS

Authorised for release to the ASX by the Board of Cluey Ltd.

For enquiries please contact:

Investors

Mark Rohald Greg Fordred CEO CFO & Company Secretary investor.relations@clueylearning.com investor.relations@clueylearning.com

ABOUT CLUEY

Cluey is an innovative, ASX-listed Edtech company that combines education, technology and data to deliver quality education outcomes and an enhanced experience for students. Cluey has a highly experienced management team and Board with a track record of building successful education businesses and is supported by an Independent Education Advisory Board comprising five eminent independent education sector thought leaders.

Cluey has been recognised in the prestigious HolonIQ inaugural list of most innovative Edtech companies in Australia.

Cluey Ltd

Cluey Ltd Quarterly Activities Report

October – December 2020

This report accompanies the Appendix 4C Quarterly Cashflow Report and provides an update and explanation of significant events in the quarter ended 31 December 2020. Cluey was admitted to the ASX on 9 December 2020, however the activities for the full quarter are included.

Highlights and key business activities

Initial Public Offering (“IPO”) and other investing and financing activities

In this quarter, Cluey completed a successful IPO and major capital raise as announced on 9 December 2020[1] . $30 million was raised in December 2020 from the issue of 25.1 million new shares. The cash raised will be used to fund Cluey’s growth strategy, including investment in sales and marketing, product development and operations.

Cash expenditure in the quarter related to the IPO and capital raise was $3.1 million in total. $1.2 million is presented in operating cashflows as it relates to the IPO, and $1.9 million in financing cashflows, being transaction costs relating to the issue of equity.

In the quarter, and prior to the IPO, Cluey paid $6.2 million in interest payments to Convertible Loan Note holders. These payments do not form part of the normal course of trading and are non-recurring as the Convertible Loan Notes no longer form part of Cluey’s capital structure.

The business is performing in line with expectations and the IPO Prospectus dated 23 October 2020 (“the Prospectus”).

Operating activities

Cluey, via its wholly owned subsidiary, Cluey Learning Pty Ltd ACN 620 549 019, has continued to provide personalised online tutoring and educational support to Australian school students in the quarter.

Significant cash receipts and payments disclosed in the Appendix 4C include:

• Cash receipts from customers of $3.2 million in the quarter and $7.0 million in the six months to 31 December 2020, representing growth of 298% and 366% on the respective prior year corresponding periods.

• Cash payments for advertising and marketing (including the payment of accruals and prepayments) in the quarter of $1.4 million, and $3.0 million for the six months to 31 December 2020.

• Cash payments to staff (including payments to tutors for their service in the provision of online tutoring) in the quarter of $5.5 million, and $10.2 million for the six months to 31 December 2020. Included in staff payments is $0.9 million relating to the issue of shares to executives, and associated taxes and superannuation as noted in the Prospectus[2] .

Cluey Ltd

Use of funds

The Company prepared the Prospectus in relation to the Offer of 25.1 million shares at an issue price of $1.20 per share to raise $30 million. The Prospectus was included in a previous announcement to the market dated 8 December 2020[2,] prior to the Company’s admission to the ASX on 9 December 2020.

In Section 1.8 of the Prospectus, the Company provided a proposed use of funds statement. The table below shows the use of funds from the date of admission to the ASX only (however the Appendix 4C attached covers the entire quarter from 1 October 2020 to 31 December 2020 and the YTD covers the period from 1 July 2020 to 31 December 2020).

Use of funds	Total per the Prospectus $m	Actual expenditure 8/12/20 to 31/12/20 $m	Commentary
Sales & Marketing	10.9	0.6	In line with expectations
Product, Customer Care, Education & Technology	5.8	0.4	In line with expectations
Expenses associated with the IPO	3.4	3.1	In line with expectations – note that all IPO costs are included, including those incurred prior to 8/12/20
Working Capital	9.9	0.0	Currently funded from working capital reserves prior to IPO
Total	30.0	4.1

Total cash on hand as at 31 December 2020 was $35.7 million.

Payments to Directors and Related Parties

During the quarter, the following payments to Directors and Related Parties were made:

• $14,101 included in cashflows from operating activities. These payments were to Executive Directors for net salary and fees, and expense reimbursements.

• $467,762 included in financing activities. These payments related to interest on the Convertible Loan Notes (now fully converted to ordinary shares) as outlined in the Prospectus.

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1 ASX announcement dated 9 December 2020: ‘Cluey to list on ASX following successful IPO’ 2 ASX announcement dated 8 December 2020: ‘Prospectus’

Cluey key facts:

• Cluey provides support for students in years 2-12 in Mathematics and English and years 11-12 in Chemistry, as well as test preparation for NAPLAN and Literacy and Numeracy Test for Initial Teacher Education;

• Through regular live online tutoring sessions, Cluey’s learning model is underpinned by personalised and tailored programs, content mapped to the national and state curricula, targeted tutor feedback and comprehensive reporting to students and parents;

• Cluey’s platform captures > 100,000 data points in every learning session to deliver valuable data-driven insights in teaching and learning using proprietary analytics;

Cluey Ltd

• Strong student and customer feedback with 91% of students rating their session experience positively and 82% of parents agreeing that their child’s grades have improved since using Cluey; and

• Cluey is headquartered in Sydney, Australia. At the end of December 2020, Cluey had >90 full time equivalent staff and 822 qualified tutors.

Cluey Ltd

Cluey Ltd

ASX: CLU

Appendix 4C

Quarterly cashflow report for entities subject to Listing Rule 4.7B

Name of entity

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Cluey Ltd
ABN Quarter ended ("current quarter")
65 644 675 909 31 December 2020
Consolidated statement of cash flows Current quarter Year to date
(6 months)
$A'000 $A'000
1. Cash flows from operating activities
1.1 Receipts from customers 3,236 7,033
1.2 Payments for: 0 0
(a) research and development 0 0
(b) product manufacturing and operating costs 0 0
(c) advertising and marketing (1,356) (2,965)
(d) leased assets (164) (173)
(e) staff costs (5,454) (10,157)
(f) administration and corporate costs (1,211) (1,744)
1.3 Dividends received 0 0
1.4 Interest received 48 71
1.5 Interest and other costs of finance paid (refer item 3.9) 0 0
1.6 Income taxes paid 0 0
1.7 Government grants and tax incentives 13 50
1.8 Other (provide details if material) - IPO related costs (1,187) (1,187)
1.9 Net cash from / (used) operating activities (6,075) (9,072)
Staff costs (item 1.2) include payments to tutors for their service in the provision of online tutoring
IPO related costs (in item 1.8) excludes costs related to the issue of new shares shown in item 3.4
2. Cash flows from investing activities
2.1 Payments to acquire or for:
(a) entities 0 0
(b) businesses 0 0
(c) property, plant and equipment (31) (52)
(d) investments 0 0
(e) intellectual property 0 0
(f) other non-current assets 0 0
2.2 Proceeds from disposal of: 0 0
(a) entities 0 0
(b) businesses 0 0
(c) property, plant and equipment 0 0
(d) investments 0 0
(e) intellectual property 0 0
(f) other non-current assets 0 0
2.3 Cash flows from loans to other entities 0 0
2.4 Dividends received 0 0
2.5 Other (provide details if material) 0 0
2.6 Net cash from / (used in) investing activities (31) (52)
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Cluey Ltd

ASX: CLU

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Consolidated statement of cash flows Current quarter Year to date
(6 months)
$A'000 $A'000
3. Cash flows from financing activities
3.1 Proceeds from issues of equity securities (excluding 30,000 30,030
convertible debt securities)
3.2 Proceeds from issue of convertible debt securities 0 9,505
3.3 Proceeds from exercise of options 0 0
3.4 Transaction costs related to issues of equity securities or convertible (1,883) (2,345)
debt securities
3.5 Proceeds from borrowings 0 0
3.6 Repayment of borrowings 0 0
3.7 Transaction costs related to loans and borrowings 0 0
3.8 Dividends paid 0 0
3.9 Other (provide details if material) - interest and compensation (6,229) (6,229)
payments relating to convertible debt securities
3.10 Net cash from / (used in) financing activities 21,888 30,961
4. Net increase / (decrease) in cash and cash equivalents
for the period
4.1 Cash and cash equivalents at beginning of period 19,946 13,891
4.2 Net cash from / (used in) operating activities (item 1.9 above) (6,075) (9,072)
4.3 Net cash from / (used in) investing activities (item 2.6 above) (31) (52)
4.4 Net cash from / (used in) financing activities (item 3.10 above) 21,888 30,961
4.5 Effect of movement in exchange rates on cash held 0 0
4.6 Cash and cash equivalents at end of period 35,728 35,728
5. Reconciliation of cash and cash equivalents Current quarter Previous quarter
$A'000 $A'000
at the end of the quarter (as shown in the consolidated
statement of cash flows) to the related items in the accounts
5.1 Bank balances 728 5,946
5.2 Call deposits 35,000 14,000
5.3 Bank overdrafts 0 0
5.4 Other (provide details) 0 0
5.5 Cash and cash equivalents at end of quarter (should equal
item 4.6 above) 35,728 19,946
6. Payments to related parties of the entity and their associates Current quarter
$A'000
6.1 Aggregate amount of payments to related parties and their associates included in item 1 14
(refer to quarterly activity report for further details)
6.2 Aggregate amount of payments to related parties and their associates included in item 2 0
6.3 Aggregate amount of payments to related parties and their associates included in item 3 468
(refer to quarterly activity report for further details)
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Cluey Ltd

ASX: CLU

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7. Financing facilities Total facility at Amount drawn at
quarter end quarter end
$A'000 $A'000
7.1 Loan facilities 0 0
7.2 Credit standby arrangements 0 0
7.3 Other (please specify) 0 0
7.4 Total financing facilities 0 0
7.5 Unused financing facilities available at quarter end 0
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• 7.6 Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well. None

8. Estimated cash available for future operating activities 8.1 Net cash from / (used in) operating activities (item 1.9) 8.2 Cash and cash equivalents at quarter end (item 4.6) 8.3 Unused finance facilities available at quarter end (item 7.5) 8.4 Total available funding (item 8.2 + item 8.3) 8.5 Estimated quarters of funding available (item 8.4 divided by item 8.1)***	$A'000 (6,075) 35,728 0 35,728 6

*** The calculation of estimated quarters of funding available is based on $6,075,000 of operating cash outflows in the quarter. This figure includes $1,187,000 of cash payments related to the IPO which are non-recurring. Excluding these IPO costs, and before allowance for projected growth in cash receipts from customers, there are at least 7 quarters of funding available as at 31 December 2020.

• 8.6 If item 8.5 is less than 2 quarters, please provide answers to the following questions: 8.6.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?

Answer: n/a

8.6.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful? Answer: n/a

8.6.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis? Answer: n/a

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Date: 22 January 2021

Authorised by: the Board of Cluey Ltd