Dragontail - (DTS.ASX) - QSR Technology

[Drew95]

As part of my mission to discover interesting ASX listed companies with large future growth potential, I am starting this thread on Dragontail Quick Service Restaurant technologies.


The following is taken from the CEO's address to the General Meeting on 28 May 2020. For the full statement here is the link https://www.dragontail.com/investors/


"Dragontail Systems Limited the technology company revolutionizing the Quick Service Restaurant (QSR) and food service industry. The current funding process, for which the EGM meeting is convened, involves the investment of up to AUD$19.25m from strategic partners. The current fundraising will enable the Company to expand its activities and execute on the vast opportunities that presented to Dragontail which we are yet to realize. Among others, the Company will be able to expand into the significant market of the US. The funds will also serve the Company to repay its existing corporate loans with Alceon, and Eldridge, and thus be debt free. Following the tremendous success in the UK, having the Algo Platform nationally installed across Pizza Hut stores in the UK, together with the recent launch of the AI-based QT Make-line Camera, the Company has successfully expanded its operations into more European countries, including Belgium. Dragontail has reached the significant milestone of 2,500 global installations and has received very positive customers feedback supported by proven strong KPI improvements from using the Company’s technology. We believe this will strongly position the Company to double its install base within 12 months and as a result be closer to a breakeven point. Since launching its first product, every Dragontail customer who has installed the technology and remained operational has continued as a customer or expander their relationship with the Company. This is demonstrated by those who trailed the last mile solution, using Algo Lite, and eventually opted to upgrade to the full Algo platform, such as FMI, the largest Pizza Hut franchisee in Canada. This enables the Company to increase its average monthly per-store recurring revenue. While maintaining the position as the leading innovative technology company in the food delivery industry, the Company sees the current round of funding as a stepping stone towards accomplishing its goals, and scaling its installed base globally."


6 Jan 2020. "Dragontail experienced a more than 10-fold increase in the number of orders that were processed by its proprietary technology during December 2019 compared to December 2018, with over 6.5 million orders processed."


Dec 2019 Annual Report here... https://www.asx.com.au/asxpdf/202003...22fvkrmt4w.pdf


The P+L and Balance sheet look pretty sick, before the $19 million investment. So, will this be a dead duck or is it at the very bottom of a big growth curve? It will be very interesting to see.

DYOR. Discl. Purchasing a small 'watching' position.

[Joshuatree]

Thanks Drew.Always good to have new aussie ideas to look at especially in this microchip sector one in its infancy. issue price for the convertible pref shares 13 c same as current s/p.