SPACETALK LTD — Investor Presentation 2024

Feb 28, 2024

1H24 Investor Presentation

Safety At Every Stage Of Life

29 February 2024

spacetalk.co

Contents

• 1. Investment Highlights
• 1. Business and Strategy Update
• 1. 1H24 Financial Results Summary

1. Investment Highlights

1H24 results demonstrate continued growth

	1H24	1H23	Change
Revenue from continuing operations ($m)	9.2	7.0	31%
Gross Profit from continuing operations ($m)	4.2	3.0	40%
GP margin (%)	46%	43%	3ppts
Annual Recurring Revenue ($m)	9.5	7.4	28%
Recurring Revenue Mix (%)	48%	46%	2ppts
Total Spacetalk App and Mobile Subscribers1	70,955	64,469	10%
Spacetalk Mobile Subscribers (higher ARPU than Spacetalk App)	26,036	6,993	272%

1 App 1HFY23: 57,476 (1HFY24: 44,919); Spacetalk Mobile 1HFY23: 6,993 (1HFY24: 26,036)

2. Business and Strategy Update

Our ecosystem

Our focus

of family safety technology products.

on strategy implementation, all flow from our vision and mission.

VISION

Safety at every stage of life.

MISSION

To ensure family safety by providing an ecosystem of products that enable freedom and create peace of mind.

Transformation

CEO and leadership team continue to transform Spacetalk

February 2023

Spacetalk was a consumer electronics hardware business

Spacetalk is a wearables enabled software subscription and Mobile Virtual Network Operator (MVNO) business

Targeting an underlying sustainable cash generative operation by 2H24

$20m-$25m

ARR business within 3 years from June 2023

S ' r n f r n nd gr w h r gy n g

We are delivering our growth and transformation strategy as promised

1	Raise funds to support strategy delivery	Complete
2	Get to cash positive	2H24
3	Temporarily wind down international operations	Complete
4	Hire org backbone (Segment Sales, Engineering, Product)	Complete
5	Align whole business behind Spacetalk brand	Complete
6	Review MVNO commercial agreements	Complete
7	Reset & increase Australian education sales	2H24
8	Reset & increase ANZ retail 'Kids Watch' sales	Complete
9	Reset & increase ANZ eComm 'Kids Watch' sales	Complete
10	Evaluate & launch* 'Agnostic App' (Family App)	Complete
11	Evaluate & launch* 'MVNO Family Plan'	Complete
12	Activate ANZ '24/7 monitoring' 'Life' sales channel	Complete
H2	Evaluate and upgrade* 'Schools Messaging	Complete (Additional item)
H2	Evaluate & launch* 'Budget Watch'	Complete (Additional item)

S ' f y f y technology business on a page

One Theme:

1. Family Safety 1. Freedom

Two Emotional Experiences:

1. Peace of Mind

Three Product Sets:

1. Wearable Hardware & Companion Apps

• 1. Mobile Connection (MVNO Plans)
• 1. Schools Messaging Suite

Four Customer Segments:

• 1. Schools and Educators
• 1. Young Families
• 1. Seniors and Vulnerable Families
• 1. Employers and Workers

Five Established Revenue Streams:

• 1. Hardware Sales
• 1. MVNO Subscriptions
• 1. App Subscriptions
• 1. Software Subscriptions (SaaS)
• 1. SMS Subscriptions

We continue to focus on Product Ecosystem innovation

Wearable hardware & companion apps

Hardware sales covert to Spacetalk Mobile subscribers at a high rate, meaning our MVNO customer acquisition cost is virtually zero.

Spacetalk products

work together as a value multiplying ecosystem

Customers are acquired

at very low cost directly & through hardware sales

Customers are retained

within a suite of subscription MVNO and software products

Adventurer Watch

4G smartwatch and GPS device full of safety features, making it the perfect first phone for kids.

Adventurer 2 Watch

Our newest 4G smartwatch. It has video calling, talk and text, GPS location tracking, school mode, emergency SOS, and tough Gorilla glass.

Life Watch

Updated September 2023

4G mobile phone watches that automatically detect falls, calls SOS contacts, provides GPS location data and connection to 24/7 monitoring providers.

Loop Watch

October 2023 Distraction free affordable 4G and GPS watch.

Companion App

The Spacetalk App connects to kids and seniors Spacetalk devices, enabling you to locate family members, communicate with them at any time.

Family App (Reach)

September 2023 Device agnostic app that provides all the features of the companion app, for any device (no need for a Spacetalk watch).

Accessories

A range of new straps, charging docks and screen protectors.

spacetalk.co

Spacetalk Loop & Bundles

Bundling a Spacetalk wearable device with a recurring Spacetalk Mobile subscription to provide a simple solution for customers.

Loop devices are locked to the Spacetalk Mobile network, increasing subscribers and reducing SIM churn.

spacetalk.co

Spacetalk Life mPERSBundles

Bundling a Spacetalk Life mPERS wearable device with a 12 month recurring Spacetalk Mobile subscription, 12 month Spacetalk App subscription and 12 month 24/7 safety monitoring subscription to provide a simple solution for seniors, their families and carers.

Life devices are bundled with 12 month recurring subscriptions to reduce both Spacetalk Mobile and Spacetalk App churn.

spacetalk.co

Protect Bundle

365 day recurring Spacetalk Mobile subscription

365 day recurring Spacetalk App subscription

365 day 24/7 safety monitoring subscription

Unlimited talk and text

30GB data at 4G speed

Spacetalk Mobile

More Spacetalk watches will be locked to the Spacetalk Mobile network in 2H24.

Four new 4G & 5G handset plans and Reach app extend our value proposition and will increase customer lifetime value.

New products and geographies planned.

Spacetalk Schools

Spacetalk Schools serves ~900 schools nationwide, engaging ~620,000 parents each year.

7 School POC Testing and refinement of updated app.

~1,000 Parents Opted In

Spacetalk Schools is being activated as a channel to reach. Young Families

Av ~900 S h J n '24

Offered as a value service.

Renewed Focus

Customer success and direct engagement with schools remains a priority.

Fundraising Offer

Ongoing focus on engaging schools to share financial benefits and deepen relationships with parents.

Schools Messaging Suite

School attendance and parent message product suite, including analysis and reporting of attendance patterns that may indicate an at risk child. Rebranded from MGM Wireless in July 2023.

New School <> Parent communication app launched in September 2023.

spacetalk.co

spacetalk.co

We continue to achieve consistent active user and subscriber growth

Grow customer base, increase subscription revenue and customer lifetime value on strong foundation

Active Wearables Devices (12th Jan 2024) ~85,000 active devices globally ~66,000 active devices in Australia and NZ Spacetalk Mobile MVNO Subscribers (31st Dec 2023) ~26,000 active subscribers in 13 months ~23,700 active subscribers in Australia Spacetalk Schools SaaS Subscribers (12th Jan 2024) ~900 Schools using SaaS product ~10% of all Australian Schools ~620,000 parents engaged ~24,500,000 messages sent Launched November 2022 Spacetalk App Subscribers (12th Jan 2024) ~46,500 paying app subscribers globally 4.6 star rating 2,700 ratings 200,000+ downloads

each year

monthly

Focus on operational excellence while growing revenue

Offshoring to reduce costs while maintaining high quality is already underway

December 2023

Customer Support Team

Suva, Fiji

Dedicated, lower cost, high quality Spacetalk customer support team has been activated in Suva.

Ongoing focus on operational efficiency in other areas of the business including finance, marketing, ecommerce and product.

3. Financial Summary -1H24 Results

Solid Year on Year Growth Delivered

$M	1H24	1H23	Change
Revenue from continuing operations
Subscription*	4.4	3.2	38%
Hardware	4.8	3.8	26%
Total revenue	9.2	7.0	31%
Gross profit from continuing operations	4.2	3.0	40%
Operating expenses before material non recurring costs	(5.5)	(5.5)	0%
Normalised EBITDA from continuing operations	(1.3)	(2.5)	(48%)
Non recurring expenses**	(1.3)	(1.0)	30%
EBITDA	(2.6)	(3.5)	(26%)
Depreciation, impairment and amortisation	(0.5)	(4.0)	(88%)
Interest expense	(0.3)	(0.4)	(25%)
NPAT	(3.4)	(7.9)	(57%)
Annual Recurring Revenue (ARR)	9.5	7.4	28%
Cash and cash equivalents***	2.9	3.0	(3%)

Commentary

• Strong subscription revenue growth of 38% driven by an 850% increase in Spacetalk Mobile revenue vs pcp, partially offset by an expected 16% decline in App revenue, and 18% decline in Schools revenue
• 26% Increase in Device revenue driven by 20% volume increase and 7ppts better margin
• Gross profit increase of 40% driven by increased revenue (29%) and better revenue mix towards higher yielding subscription revenue
• ARR increase of 28% reflects the strong Spacetalk Mobile performance, resulting in over 26,000 active paying subscribers added after launch in November 2022
• Operating expenses are flat, excluding the impact of noncash share-based payments and material one-off costs.
• Normalised EBITDA improving on the back of higher revenue and margins

*1H24 includes Spacetalk Mobile $1.8m; App +$1.6m and Schools +$0.9m; 1H23 includes Spacetalk Mobile +$0.2m; Ap[p +$1.9m and Schools +$1.1m

**1H24includes redundancy ($0.2m); noncash debt restructuring costs ($0.2m); fair value loss on derivatives ($0.3m); nonrecurring recruitment costs ($0.5m) and other ($0.1m).

1H23 includes noncash debt restructuring costs ($3.4m); fair value gains on derivatives +$2.4m.

***Comparative cash balance is as at 30 June 2023.

Quarterly ARR has grown ~ 2.2x since Q1 FY21

Annual Recurring Revenue (ARR)

• 118% growth from Q1FY21 to Q2 FY24
• Combined App & Spacetalk Mobile growth of 75% over same period
• Spacetalk Mobile 48% of ARR in Q2FY24 (FY23Q2: 8%)
• ARR growth underpins future cash generation and profitability.

Spacetalk Mobile subscriber growth of 978% on prior year demonstrates execution of strategy

Global Subscribers

• Spacetalk Mobile subscribers 37% of total subscribers at December 23, vs 11% in prior comparative period
• Strong Spacetalk Mobile subscriber growth in 1H24 of 77% vs closing FY23 reflects strong peak Nov/Dec performance
• Change in subscriber mix will result in higher revenue as Spacetalk Mobile is ~3x App revenue per user

Subscription revenue increasing, underpinned by rapid growth of Spacetalk Mobile revenue

• Continued shift from device revenue to recurring revenue, while growing total revenue

• 1H24 recurring revenue was 48% (1H23:46%) of total revenue
• Spacetalk Mobile and App revenue 81% (1H23: 66%) of recurring revenue
• Recurring revenue is higher margin, lower working capital needs and has greater cash generation

Important legal information

This presentation has been prepared by Spacetalk Ltd. ("Spacetalk," or "Company," or "SPA").

This presentation:

• has been prepared in good faither and with reasonable care. Neither SPA nor any other person makes any representation or warranty, express or implied as to the accuracy, reliability, reasonableness or completeness of the contents of this presentation (including any projections, forecasts, estimates, prospects and returns), and any omissions from this presentation. To the maximum extension permitted by law, SPA and its respective officers, employees and advisers disclaim and exclude all liability for any loss or damage (whether or not foreseeable) suffered or incurred by any person acting on any information (including projections, forecasts, estimates, prospects and returns) provided in or , or omitted from, this presentation or any other written or oral information provided by or on behalf of SPA.
• is intended to be general background information only, and is not intended that it be relied and the information this presentation does not take into account your financial objectives, situations or needs. Investor should consult wither their own legal, tax, business and/or financial advisers in connect with any investment decision.
• should be read in conjunction with Spacetalk's financialreports and market releases on ASX.
• may include forward-looking statements about Spacetalk and the environment in which Spacetalk operates, which are subject to significant uncertainties and contingencies, many of which are outside the control of Spacetalk – as such undue reliance should not be placed on any forward-looking statements as actual results or performance may differ materially from these statements
• includes statements relating to past performance, which should not be regarded as a reliable guide to future performance.
• includes certain financial information which Spacetalk considers useful to assist in evaluating Spacetalk's performance, however, such information has not been subject to audit or review in accordance with Australian Auditing Standards.
• All dollar values are inAustralian dollars (A$) unless otherwise stated.

Safety at every stage of life

Spacetalk Limited (ASX:SPA) 1H24 Investor Update Presentation

For more information contact Simon Crowther CEO and Managing Director E: investors@spacetalk.co

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