• Delivered a cashflow positive first half year
• Renewed key agreements with Telmex, ISSSTE, NASA, and Claro Dominican Republic
• Released new 'opHA Message-Bus' technology for high availability network management

FirstWave Cloud Technology Limited (ASX:FCT) provided its Activity Report and Appendix 4C for the second quarter of FY25 ended 31 December 2024. The board is very pleased to have seen the company deliver a cashflow positive first half year, reflecting significant operational reform over the past 18 months together with high renewal rates for key agreements and the receipt of annual R&D funding. The company renewed several major client agreements with uplifted revenues, including with Telmex, ISSSTE, NASA, and Claro Dominican Republic. The renewal/extension of the agreement with Telmex, a strategic partner for FirstWave in Latin America, is particularly significant. The company also released a new 'opHA Message-Bus' technology, an industry-leading high availability message bus that allows large organizations to implement FirstWave's network management technology at higher scale and performance. The company's cash position was neutral during the quarter, with cash inflows from customers and R&D tax offset rebate offsetting cash payments for staff, product, and operating costs. The company's normalised cash usage at the end of Q2 was $273k per month, up from $251k in Q1 due to the drop in gross profit from Telstra end-customer churn. The board has advanced options to de-risk the business during the upcoming cash usage cycle in Q3.

The company's capital requirements are cyclical, and while the board acknowledges the significant achievement of zero cash usage over the first 6 months, it also acknowledges that March commences a cycle where the company uses more cash. While the likely cash usage is anticipated to be substantially less than in previous years, the board has advanced considerably the options it has at its disposal to de-risk the business during this period.