SKS TECHNOLOGIES GROUP LIMITED — Interim / Quarterly Report 2021

May 17, 2021

==> picture [896 x 384] intentionally omitted <==

----- Start of picture text -----

Company Update
----- End of picture text -----

Matthew Jinks Chief Executive Officer

May 2021

==> picture [894 x 27] intentionally omitted <==

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Disclaimer
----- End of picture text -----

The material contained in this document is a presentation of general information about SKS Technologies’ activities current as at the date of this presentation. It is provided in summary and does not purport to be complete. You should not rely upon it as advice for investment purposes, as it does not take into account your investment objectives, financial position or needs. These factors should be considered, with or without professional advice, when deciding if an investment is appropriate.

To the extent permitted by law, no responsibility for any loss arising in any way (including by way of negligence) from anyone acting or refraining from acting as a result of this material is accepted by SKS Technologies, including any of its related bodies corporate.

This document may contain forward-looking statements with respect to the financial condition, results of operations, and business strategy of the SKS Technologies Group. These forward-looking statements are based on estimates, projections and assumptions made by the SKS Technologies Group about circumstances and events that have not yet taken place. Although SKS Technologies believes the forward-looking statements to be reasonable, they are not certain. Forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond SKS Technologies’ control, and which may cause actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results). SKS Technologies makes no representation or warranty as to the accuracy of any forward-looking statements in this document and undue reliance should not be placed upon such statements.

The forward-looking statements in this document speak only as of the date of this document. SKS Technologies does not intend to update the forward-looking statements in this document in the future.

==> picture [166 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

2
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Company Snapshot
----- End of picture text -----

SKS Technologies delivers advanced technology via creative design and installation of converged AV/IT, electrical and communication networking solutions nationally.

==> picture [897 x 336] intentionally omitted <==

----- Start of picture text -----

Business Profile Industry Profile
170+ Employees 87% Repeat business Government
Hospitals
Buildings
$60M Annualised Run Rate National Presence
Commercial Correctional
Buildings Facilities
Sporting
Brisbane Airports Complexes
Queensland
Perth
Western Australia
Sydney
New South Wales
Adelaide Hotels Universities
South Australia
Melbourne
Victoria
----- End of picture text -----

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

3
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Restructure Activity
----- End of picture text -----

A wholesale restructure of the business was undertaken, largely in FY20, to remove underperforming business units as well as $1 million in costs from the continuing operations and build a solid foundation for growth.

==> picture [884 x 254] intentionally omitted <==

----- Start of picture text -----

•
• Settled the sale of Announced rights
the street lighting issue to raise • Divested • Settled the sale
business for $3.1M $1.5M, fully commercial of the
• underwritten by commercial •
Began Restructuring • Reduced cost • Commenced • Commenced executive lighting business in July 2020 for lighting business Changed auditors
Urban Lighting in base on WA paying down overhaul of IT directors $0.865 million, • Halved debt
significant levels of
preparation for operations by debt infrastructure to • Halved debt from including Lumex from $3.3M to
sale $0.5M pa save $150k pa $6.7M to $3.3M and Lumigrow $1.74M
FY21
Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
FY20
• Appointed new • Temporarily • Commenced • Commenced the
CFO who had reduced process to divest shift to a more
worked with the executive commercial economical cloud-
management director salaries lighting business based accounting
team previously by 60% to assist system
working capital
position
----- End of picture text -----

==> picture [166 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

4
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

APEC Acquisition
----- End of picture text -----

A key tenet of the SKS Technologies’ growth plan is to target acquisitions that leverage economies of scale, expand revenue opportunities and build customer networks.

==> picture [184 x 35] intentionally omitted <==

----- Start of picture text -----

Rationale
----- End of picture text -----

Integration

• Complementary product/service offering and client base, which enables SKS Technologies to achieve scale benefits

• Secures a platform to leverage and build long-term recurring revenue from a broad client base

• Expected to be EPS accretive in the first year of combined operations

• Transaction completed on 31 March and integration commenced 1 April

• All employees located at SKS Technologies facilities by June 21

• All APEC operating systems, including front and back office, transitioned to SKS Technologies systems

• New work being won on the basis of the integrated business offering

==> picture [166 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

5
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Earnings Performance and Forecast – Continued Operations
----- End of picture text -----

Based on year-to-date performance as at 30 April, the business anticipates a 25% increase in revenue, including the APEC acquisition and a $2.4 million turnaround in net profit after tax.

==> picture [852 x 199] intentionally omitted <==

----- Start of picture text -----

Sales Revenue ($M) EBITDA ($M) NPAT ($M) EPS (cents)
2.0 1.2
33.2
1.1
1.0
25.2 26.6 0.6
1.1
-0.4 -1.2 -1.8
FY19 FY20 FY21(f) FY19 FY20 FY21(f) FY19 FY20 FY21(f) FY19 FY20 FY21(f)
----- End of picture text -----

==> picture [166 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

6
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Cash and Debt
----- End of picture text -----

Cash reserves remain adequate with cash flows from operations showing a greater than $4.5 million turnaround and a 76% reduction in debt since June 2019.

==> picture [628 x 203] intentionally omitted <==

----- Start of picture text -----

Cash flows from Ops ($M) Debt ($M) Cash at Bank ($M)
1.8
1.1
6.7
-0.1
0.7
3.3
-2.8 1.6 0.2
FY19 FY20 1H21 FY19 FY20 1H21 FY19 FY20 1H21
----- End of picture text -----

• Operations cash flow positive, providing cash for working capital and debt reduction

==> picture [166 x 67] intentionally omitted <==

• Debt reduced by over $5 million since FY19 as a result of:

• sales proceeds

• capital raising

• cash generated by the business

• SKS Technologies also has access to an additional $3 million working capital facility to fund a record order book

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

7
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Work on Hand
----- End of picture text -----

SKS Technologies’ successful project delivery track record is now a key selling proposition in winning new projects at a rate that is greater than projects are being completed, building the forward revenue profile.

• Approximately 90% of Work on Hand will convert to revenue within 12 months with the balance during the following 21 months

• Work on Hand position has grown post the restructure and has continued to grow at a rapid rate despite the disruption across the economy caused by COVID-19

• Sufficient working capital to fund this increased level of operations is available, particularly given the $3 million financing facility that was drawn down by only $0.18 million at the end of 3Q21

==> picture [166 x 67] intentionally omitted <==

==> picture [417 x 314] intentionally omitted <==

----- Start of picture text -----

Work on Hand ($M)
26.0
22.0
10.0
10.0
7.1
30-Jun-20 31-Mar-21 30-Apr-21 30-Jun-21
SKS Technologies APEC Technologies Combined SKS & APEC
----- End of picture text -----

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

8
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Major Contracts
----- End of picture text -----

An impressive bank of experience and expertise across market sectors enables the business to secure large contracts with government and blue-chip organisations.

Contract Details	End Client	Completion
Youth Justice Centre	Victorian Government	March 2022
AFP Melbourne State Office	Australian Federal Police	July 2022
Eastland EastCo Tower	Victorian Government Department of Transport	February 2022
Australian Post Bayswater Distribution Centre	Australia Post	June 2022
Adelaide Railway Station Refurbishment	Adelaide Railway Station	December 2021
Thiess Brisbane New Head Office	Thiess	October 2021

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

9
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

SKS Technologies Strategy
----- End of picture text -----

The strategy is to drive higher margins with a recurring revenue model by leveraging the convergence of AV and IT networks.

Restructure & Core Business Technology Technology Consolidation Growth Expansion Growth

• ✓ Divested non-core businesses

• ✓ Raised capital and retired debt

• ✓ Built working capital

• ✓ Reduced inventory

• ✓ Significantly grown work in hand position

• ✓ Completed APEC

• Technologies acquisition

• ✓ Increased capability and scale

• Complimentary IT acquisition

• Recurring revenue model direct to end user

• Managed AV and IT Integrated solutions

  • Converged IT networks within intelligent buildings

  • Organic and acquisitive growth of expanded technology service offering

• requirement and associated capital

• ✓ Implemented efficiency measures across the continuing operations

==> picture [166 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

10
----- End of picture text -----

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

The Opportunities of the New Workplace
----- End of picture text -----

Growth into new markets will capitalise on the SKS Technologies’ current market position and leverage the convergence of AV and IT to increase margins and grow recurring revenue contracts.

==> picture [679 x 331] intentionally omitted <==

----- Start of picture text -----

Cyber security to secure
the network and every Security
device that sits on it
Network
Employees’ ability to
perform their job by
Digital Audio-Visual
collaborating,
Workplace
communicating and
connecting with others
through technology
Unified
Communications
----- End of picture text -----

==> picture [351 x 302] intentionally omitted <==

----- Start of picture text -----

Copper/Fibre networks,
Hardware, Software and
Managed IT Services
Traditional AV Integration –
Displays, speakers and
control devices
Instant messaging,
presence information, IP
telephony, mobility
extension, video
conferencing and
desktop/data sharing,
digital signage and IPTV –
all forms of communication
via a network
----- End of picture text -----

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

11
----- End of picture text -----

Further Information: Matthew Jinks Chief Executive Officer Tel: +613 9289 5000 Email: matthew.jinks@sks.com.au

==> picture [181 x 67] intentionally omitted <==

==> picture [894 x 27] intentionally omitted <==

==> picture [896 x 37] intentionally omitted <==

----- Start of picture text -----

Appendix 1 - SKS Technologies Snapshot
----- End of picture text -----

**ASX MARKET INFORMATION ***

Shares on Issue	107,983,602
Options on Issue	0
Market Cap	$26.46M
52-Wk High	$0.25
52-Wk Low	$0.035
AV Volume	53,203

SKS SHARE PRICE MOVEMENT AS AT 12/05/21

==> picture [590 x 148] intentionally omitted <==

----- Start of picture text -----

0.25
0.20
0.15
0.10
0.05
0.00
May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21
----- End of picture text -----

*As at 12/05/21

FINANCIAL INFORMATION 1H21

Revenue*	$14.6M
EBITDA*	$1.1M
EBIT*	$0.76M
NPAT*	$0.66M
NPAT (Total)	$1.03M

• From continuing operations

	DIRECTORS AND KEY EXECUTIVES	DIRECTORS AND KEY EXECUTIVES
	Mr Peter Jinks	Executive Chairman
	Mr Greg Jinks	Executive Director
	Mr Terence Grigg	Non Executive Director
	Mr Matthew Jinks	Chief Executive Officer
	Mr Gary Beaton	Chief Financial Officer

COMPANY INFORMATION

ASX Listing	01/01/1974
Name	SKS Technologies Group
	Ltd
Offices	Melbourne (HQ), Sydney,
	Brisbane, Adelaide, Perth
No of staff	170

==> picture [894 x 27] intentionally omitted <==

----- Start of picture text -----

13
----- End of picture text -----