KINATICO LTD — Interim / Quarterly Report 2021

Jan 19, 2021

ASX RELEASE ASX: CV1

20 January 2021

CVCHECK – Q2FY21 QUARTERLY ACTIVITIES REPORT

• A record of over $3.5m revenue booked in Q2FY21 (12% higher than PCP), $2.7m coming from B2B and $0.8m B2C

• A record of $7.0m revenue booked in H1FY21

• A record of over $10.2m booked ARR in the 12 months to 31 December 2020

• Revenue from platform integrations continued rising strongly (87% above PCP)

• First international white-label client, Netforce Global, already amongst CV1’s top 30 clients by revenue for the quarter

• Net cash generation in Q2 driven by strong sales and $0.1m government assistance

• Strong balance sheet with cash at bank $5.2M as at the end of December, no debt

Leading online integrated screening and verification company, CV Check Limited (“CV1” or “the Company”) (ASX:CV1) is pleased to provide an operating update and report on its cashflow performance for Q2FY21.

CV1 Chief Executive Officer, Rod Sherwood, commented, “CV1 revenues surged in Q2 to set all-time company records for a quarter, for a half-year and for the booked 12-month ARR. All channels performed strongly: direct sales, revenues booked through integration partners and the nascent international white label channel where our first marquee client Netforce Global LLC already features among our group wide top 30 customers for the quarter.”

“Looking forward, there are promising signs in both internal and external backdrops. Internally, new client wins have been strong during recent months, resulting in an ongoing pipeline of customer onboarding. TechnologyOne, Australia’s largest enterprise software company, recently integrated with CV1, opening another new segment of the market for our team to target. Our technology team assisted with that integration and have several other new builds in progress. The external backdrop is also positive with the ANZ job ads series for December coming in stronger than that of February 2020 and consumer purchasing strengthening amid continuing COVID-related government support for the economy and widespread optimism about planned vaccine roll outs domestically and internationally.”

Record revenues

CV1 Group revenue was 12% higher than the PCP with strong sales occurring right through until Christmas. The Company set new sales records for the quarter of over $3.5m, for the half year of $7.0m and for the booked 12-months ARR to 31 December 2020 of over $10.2m. In the quarter, $2.7m of sales came from B2B customers, an increase of 14% on PCP, and B2C sales of $0.8m increased by 7% against PCP. The strong revenue performance was accompanied by continued strength in total website usage and new account sign ups.

Notable new customers

First orders were booked during the quarter from new customers including AECOM (NYSE: ACM), APS Group, Cenitex, Kone (HEL: KNEBV), Korn Ferry (NYSE: KFY), Netforce Global LLC, Pfizer (NYSE: PFE), TSB Bank Ltd, UDC Finance Ltd, Woolworths (ASX: WOW) and several municipal councils among many other well-known brands.

These client wins were aided by the CV1 platform offering a comprehensive range of screening and verification products, the broad number of integrations now in place with other key HR technology platforms and the strong performance of our customer engagement teams.

Platform integrations

As previously announced, part of CV1’s strategy is to deliver growth through platform integrations with providers of other HR information systems and applicant tracking systems. Revenue booked through these integrations continues to rise strongly with Q2FY21 sales through integrations exceeding PCP by 87%.

CV1 further increased its addressable market by recently completing a successful integration with TechnologyOne (ASX: TNE), Australia’s largest enterprise software company; the customer launch is proceeding in Q3FY21. Further such builds are in progress and we look forward to updating shareholders as each goes into the live production environment.

International customers

CV1 previously announced its strategic objective to white label its screening and verification services, particularly to recognised international wholesalers within the industry.

The strategic white label rollout gained momentum during the quarter with CV1 announcing on:

• 15 October 2020, that it had signed US headquartered employment screening specialist, Netforce Global LLC, as its first international customer under the strategic white label rollout; and

• 22 October 2020, that it had signed UK headquartered Vero Screening Ltd as another international customer under this roll out.

CV1 is pleased to report that Netforce Global LLC featured among our list of top 30 clients during Q2FY21.

Cash positive quarter, strong balance sheet

Driven by strengthening sales performance, customer receipts rose to $3.6m in Q2FY21 to be 10% higher than the $3.3m received in the PCP and resulted in a positive operating and investing cashflow outcome for the quarter.

Net assistance and incentives from government were limited to $0.1m of assistance received during the quarter from packages introduced by governments in response to the COVID-19 pandemic. $0.1m was received in R&D related incentive in the PCP and none in Q2FY21 as it was all received in one payment during Q1FY21.

The cash balance as at 31 December 2020 was $5.2 million and CV1 Group has no external debts.

Related party payments (listing rule 4.7C.1)

$183k of related-party payments were made during Q2FY21, being director fees, salary for the executive director and other remuneration.

-ENDS-

Announcement released with authority of CV1’s Disclosure Committee.

For further information, please contact:

Rod Sherwood, CEO Investors@CVCheck.com

+61 427 497 039

About CV Check Limited : CV1 is an expanding business with growing revenue streams through the provision of its check products to employers, industry associations and individuals via the CVCheck brand on its proprietary online platform CVCheck.com. The Company has been operating for more than 10 years and in the process has developed a world-class online platform providing a comprehensive range of checks across the globe. CV Check Limited is a listed public company quoted under the ticker CV1 on the Australian Securities Exchange (ASX).

About AECOM: AECOM is the world’s premier infrastructure consulting firm, partnering with clients to solve the world’s most complex challenges including the world’s longest cable-stayed bridge, record-breaking sports events, the largest greenfield port development mega project, life-sustaining disaster recovery programs, and the tallest tower in the Western Hemisphere. Projects span transportation, buildings, water, governments, energy and the environment. For more information please visit aecom.com

About Australian Personnel Solutions Group (APS Group): APS Group is an Australian owned and operated company, with a long history of supplying high quality candidates for contract, permanent and executive placements to a broad spectrum of business sectors. These include production and manufacturing; warehousing and distribution; transport and logistics, industrial, engineering and trades; and retail. For more information please visit: australianpersonnel.com.au

About Cenitex: Cenitex sits in the portfolio of the Victorian Department of Premier and Cabinet reporting to the Minister for Government Services. Cenitex provides reliable, robust and contemporary shared Information and Communications Technology (ICT) services, enabling the departments, agencies and over 46,000 public servants it works with to deliver services for the Victorian community. For more information please visit centitex.gov.vic.au

About Kone : Kone is a global leader in the elevator and escalator industry providing elevators, escalators and automatic building doors, as well as solutions for maintenance and modernisation. For more information please visit kone.com

About Korn Ferry: Korn Ferry is a management consulting firm headquartered in Los Angeles, California. It was founded in 1969 and as of 2019, operates in 104 offices in 52 countries and employs 8,678 people worldwide. Korn Ferry works with clients to design their organizational structures, roles and responsibilities, helps them hire the right people and advises them on how to reward, develop and motivate their workforce. For more information please visit: kornferry.com

About NetForce Global LLC : US based, Netforce Global was founded by two industry veterans in 2008 and has since rapidly evolved by supplying unique, compliant and accurate wholesale screening solutions that fit the needs of their retail screening customers. Netforce Global has an operational office based in San Ramon, California and gateway offices on four continents located in Beijing, China, Paris, France, Rio de Janeiro, Brazil, Kent in the UK and Johannesburg, South Africa. For more information please visit info.netforceglobal.com

About Pfizer: Pfizer is one of the world’s leading research based, biopharmaceutical companies. Through its Australian operations, Pfizer offers a health care portfolio with some of the world’s best-known prescription medicines, vaccines and non-prescription products. For more information please visit pfizer.com

About TechnologyOne: TechnologyOne Limited is an Australian enterprise software company. TechnologyOne was founded in 1987 in Brisbane, Australia. It is listed on the Australian Securities Exchange with the symbol TNE and is a constituent of the ASX 200 index. For more information, please visit: technologyonecorp.com

About TSB Bank Ltd: TSB Bank Ltd is a New Zealand bank with headquarters in New Plymouth. It has 25 branches across the country and provides retail banking and related financial services to individuals and companies. For more information, please visit tsb.co.nz

About UDC Finance Ltd: UDC Finance Limited is a finance company in New Zealand. UDC's main expertise is in providing asset-backed finance for plant, vehicles and equipment, where they do not rely on land or buildings as security. It became a wholly owned subsidiary of Shinsei Bank in September 2020. For more information, please visit udc.co.nz

About Woolworths Group Limited: Operating since 1924, Woolworths is one of the largest Supermarket and Grocery Store chains in Australia. With over 3,000 stores and counting, Woolworths employs over 200,000 team members serving more than 29 million customers across their various brands every week. For more information please visit woolworthsgroup.com.au