ETHERSTACK PLC — Regulatory Filings 2021

Jun 14, 2021

CEO presentation to AGM Etherstack plc (ASX:ESK) June 2021 Authorised for release to ASX by David Carter, CFO & Company Secretary

Disclaimer

This presentation has been prepared by Etherstack plc (ARBN 156 640 532) (“Etherstack” or “the Company”). The information in this presentation is for information purposes only and is not investment, financial product, legal or tax advice.

This presentation contains summary information about the activities of Etherstack and subsidiaries. The information in this presentation does not purport to be complete nor does it purport to contain all the information that a prospective investor may require in evaluating a possible investment in Etherstack. This presentation should be read in conjunction with Etherstack’s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange ( ASX ), which are available at www.asx.com.au or at www.etherstack.com

Statements in this presentation are made only as of the date of this presentation unless otherwise stated and the information in this presentation remains subject to change without notice. Etherstack is not responsible for providing updated information to any prospective investors.

Past performance information given in this presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance. The historical information in this presentation is, or is based upon, information that has been released to the market. For further information, please see past announcements released to ASX.

• This presentation may contain forward looking statements with respect to the financial condition, results of operations, business of Etherstack and certain plans and objectives of management. Actual outcomes may differ materially from forward-looking statements. Forward-looking statements, opinions and estimates provided in this presentation are likely to involve uncertainties, assumptions, contingencies and other factors. As a result, unknown risks may arise, many of which are outside the control of Etherstack. Forward-looking statements including projections, guidance on future earnings and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. Etherstack disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.

Should you have any specific queries in respect of this disclaimer please contact Etherstack directly.

© Etherstack 2021© Etherstack 2015, under NDA

CEO Presentation

Presentation Overview

Business overview

2020 Results highlights

2021 Year to date activities: strategic business development

Etherstack exhibiting at Land Forces Expo Brisbane, 1-3 June 2021:

• Attended by over 12,000 delegates (with no Victorian visitors)

• • Demonstrated P25 network infrastructure and terminals

• Promoted tactical GoBox & IVX solutions for defence & civilian use

• • Promoted milSDR and waveforms portfolio to defence - Spoke at CivDef Emergency Managers conference

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© Etherstack 2021© Etherstack 2015, under NDA

Business Overview

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Terrestrial Digital (VHF, UHF, 700MHZ) Cellular Networks (4G & 5G) Satellite PTT Networks (GS, LEOS, MEOS)
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	Traditional Digital	Mission Critical Push to Talk	Push to Talk (PTT) Over Satellite
	LMR Products	(MCPTT)	Solutions
	Digital Land Mobile Radio (LMR) Networks: Etherstack designs, manufactures and delivers our own innovative digital radio communications	Emerging international cellular standard to provide public safety solutions across 4G and 5G networks	Advances in satellite communications technologies and unprecedented number of satellites launched in the past 12-24 months
	networks	Global partnership with Samsung to use	Has provided significant satellite
Overview	OEM Supply: range of highly specialised Original Equipment Manufacturer (OEM) modules	Etherstack technology Builds on Etherstack’sexisting digital LMR soft-switching technologies	bandwidth availability and commensurate cost reductions Etherstack has been developing secure
	Technology Licensing: Etherstack licenses technologies to wireless equipment manufacturers, for embedding in chipsets within their solutions	Technology to be supplied to Samsung’s telco carrier clients globally High yield plus long term support revenues	PTT over Satellite solutions for the past 36 months Initial pilots with pubic safety and other govt departments in Australia, US & Canada underway
Example	LMR:Public Safety agencies the US, Canada and Australia	June 2020: Samsung Global Teaming Agreement	In discussions with a major satellite equipment supplier to incorporate Etherstack’s technology into their offering
Customers / Partners	OEM and Licensing:Cisco, Icom, NEC, JVC Kenwood, Harris, Thales, Rockwell Collins and Lockheed Martin	Targeting global telcos through the Samsung partnership, multiple pursuits underway	October 2020: Delivered satellite PTT solution to RCMP (Royal Canadian Mounted Police)

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© Etherstack 2021

FY2020 – Highlights

Strong positive cashflow

Positive EBITDA

FY2020 strategic wins

• Net operating cash inflow of US $1.7 million in 2020 following strong operating cash inflow of US $1.4 million in 2019 and $1.5 million in 2018.

• US $1.1 million EBITDA on revenue of US $4.7 million, following FY2019 EBITDA US $1.1 million

• Global Teaming Agreement with Samsung

• • AUD $4.1 million contract with the Department of Defence

• Resources sector orders

Successful project delivery

• Successfully delivered and commissioned a satellite connected digital radio network for the Royal Canadian Mounted Police (RCMP) within the Arctic Circle.

© Etherstack 2021

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FY2020 – Highlights

Continued recurring revenue growth

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2500 60% •
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• Aggregate recurring revenues are $2.3m, a 27% increase over 2019 driven by long term support contracts and new royalty agreements

234% increase over 6 years

• Recurring revenues contributed 50% of total revenues in 2020

• Large network support revenue for government and utility networks is very “sticky”, typically 10-15 years in nature

• Every network win generates additional long term support revenue, high value

• Most network elements are software based, leading towards a long term SaaS model

© Etherstack 2021

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FY2020 – Highlights

Focus on scalability

• Global Teaming Agreement with Samsung is a “force multiplier” driving significantly increased number of large network pursuits across the globe. This agreement is expected to contribute to a sustained growth phase in both licensing revenues and long term recurring support revenues

• Successful network deliveries in Canada (RCMP) and Western Australia (resources) sector contribute towards continued repeat orders from major clients

• Each win and successful delivery increases target customer acceptability of our solutions and increases probability of wins in competitive processes

• Continued focus on high barrier to entry developments, with high margin deliverables in repeatable market segments

Improved balance sheet and working capital

• The Company raised A$5 million before costs in December 2020 to provide additional working capital in support of development activities in particular activities related to the Samsung agreement and Australian defence projects

© Etherstack 2021

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2021 Update – Significant Revenue Growth

Strategic business development: MCPTX (4G/5G)

• In June 2020, the company entered into a Global Teaming agreement with Samsung setting out the framework for Mission Critical Push-To-Talk (MCPTT) over LTE solutions to Samsung customers, specifically being telecommunications carriers and governments, utilising Etherstack’s digital LMR soft-switching technologies

• In February 2021, The company entered into a US$1.2 million agreement with Samsung for solution integration activities for the telecommunications carrier market

• As outlined in recent trading updates, Etherstack expects initial carrier deals to be completed and announced imminently

Strategic business development: Defence & Govt Comms

• As previously advised by management during FY2020, the company is positively exposed to government infrastructure and defence spending trends

• This has translated into multiple contracts with Australian, UK, Canadian & US government entities, with over A$5m of new contracts being announced since December

• Further pursuits are currently underway with expected announcements in H2 should the company be successful in award

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© Etherstack 2021© Etherstack 2015, under NDA

2021 Update – Significant Revenue Growth

Strategic business development: Resources

• The resource sector utilises essential digital radio communications networks of the same type as used in public safety and utilities for essential operations at mining facilities

• Etherstack has made a concerted push into this sector in the past 18 months and has been rewarded with multiple network awards for a major iron ore producer in the Pilbara

• These resources networks are large infrastructure projects and have a similar “sticky” long term support revenue tail as government and utility infrastructure projects

Business as usual growth

• Our traditional LMR infrastructure business continues to grow as evidenced by the continuous recurring revenue growth the company has enjoyed over the past 6 years, underpinning profitability and stability in baseline revenues

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© Etherstack 2021© Etherstack 2015, under NDA

2021: Revenue guidance

Updated financial guidance, 27 May 2021

• “The Company now expects revenue for the half year ending 30 June 2021 to be in the range of US$3.5m to US$4.0m, representing an increase over the corresponding H1 period in 2020 of between approximately 46% to 66%”

• The company expects FY2021 (31 Dec) to significantly outperform FY2020

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© Etherstack 2021© Etherstack 2015, under NDA

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+44 207 734 0200 info.eu@etherstack.com

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New York

+1 917 661 4110 info.na@etherstack.com

Yokohama

+81 45 342 9050 info.jp@etherstack.com