AoFrio Results Presentation 27 February 2025

Greg:
Hello everyone. Thank you for making time today to join AoFrio’s FY24 results presentation.
My name is Greg Balla, I am the CEO of AoFrio, and I am looking forward to presenting today.



Greg:
Presenting with me today are, Howard Milliner, CFO of AoFrio and John Scott, our Board
Chairman.

Please note the safe harbour statement on the screen. I will give you a minute to read the
statement.


Greg:
The agenda for today is on the screen. Firstly, we are going to provide context for the FY24 year.
Then we will provide a business update highlighting the progress we’ve made against our
business strategy, and finally, we will discuss our FY25 outlook.
At the end of the presentation, we will have time for questions. If you have any questions, please
select the Q&A tab at the top of your screen and then enter your question. You can do this at any
time. We will answer questions at the end of the presentation.
Now I’ll hand you over to Howard to provide some context to the FY24 results.

Howard:
We are pleased with the result for the 2024 financial year. Revenue for the year at $79.7m was
19.7% above FY23 and at the top end of guidance.
All major business segments reporting strong growth. Our IoT business delivered revenue of
$43.3 million, up 23.4% on FY23 and the Motors business delivered revenue of $36.4 million, up
15.6% in FY23.
We made significant progress across key strategic initiatives that translated into solid revenue
growth. In particular, we launched our connected IoT solution in the USA, won a market share
for IoT in the Cold Drinks Equipment market in Brazil, and won a significant new motor volume in
the USA for a water heater application.
Gross margin was slightly lower at 29.1% compared to 30.0% last year caused by higher product
costs and strategic pricing. IoT margins were 40.7% and motor margins 15.4%.
Earnings before interest, tax, depreciation and amortization (EBITDA) was a surplus of $2.5
million, consistent with guidance given at the start of the year, and up $1.5 million compared to
FY23.
Operating cash was $1.8 million above FY23. For many years we have funded our growth
initiatives out of operating cash flows. This year was no different - $5.8 million operating cash
inflows matched by $5.9 million outflow for investing activities. We will continue to invest to
support our growth strategy.
We did see working capital increases this year, largely due to customer mix changes - more
volume to customers with longer payment terms and to customers taking products from our in-
market warehouses rather than direct from Vietnam. Longer shipping times from Vietnam to the
Americas and Europe were also a factor. This increase in working capital was funded by
extended payment terms made available by our manufacturing supplier partner East West.

Howard:
Our Annual Report has always segmented our financial results by traditional product segments
(IoT and Motors). You will see later when Greg talks about strategy that we are increasingly
talking about market segmentation. Today that is Cold Drinks Equipment, Food Retail and
Motors & Fans.
We consider that we are a hardware-enabled SaaS business and targeting SaaS to be a much
more significant contributor to the Company’s performance. Accordingly, we have for the first
time presented SaaS metrics that are relevant to our business. Our reporting will continue to
evolve in alignment with our strategy.
Just to give you a quick overview of some of the metrics that you are seeing on the table:
Rule of 40- is a financial metric used in the software industry to assess a company’s
performance. It states that the sum of a company’s annual revenue growth rate and EBITDA
margin should equal or exceed 40%. Looking at all our segments, revenue growth in 2024 was
19.7% and EBITDA was 3.2% of revenue, so a 22.9% metric. These metrics include the results
for our Motors segment that is not SaaS and cannot be expected to perform as one. If Motor
performance is excluded, the Rule of 40 metric is 35.5%. We are making progress towards
achieving this metric. The usual trend for this metric is that revenue growth rates reduce over
time and EBITDA returns improve.
Recurring Revenue: Associated with the supply of IoT hardware, AoFrio supplies a range of
data, action management and reporting services, AoFrio’s software solution. In FY24 we
invoiced $5.3 million and recognised in the P&L $2.7 million. There is $16.5 million on the
balance sheet to recognise in the P&L over future periods. Recurring revenue is only 3.2% of
total revenue in 2024 but our aspirational target is to achieve a 50% metric.
App Utilisation indicates the number of times AoFrio’s customers interacted with its software.
An increase of 66% compared to FY23 is a very good result and is a good foundation for the sale
of value-added services to customers in the future.

Over to you Greg to provide a business update.


Greg:
In FY24, we made good progress on our three strategies: protecting and growing the core
business, diversifying into new market segments, and transforming our foundations.
I will now take some time to discuss progress on each of these three strategies.

Greg:
Protect and grow our core business has two segments, the first is IoT for cold drink equipment
(CDE) and I will explain the progress for this segment.
We have stated we are targeting 20% growth year-on-year, and in FY24 we achieved 23.4%
growth in the cold drink equipment segment.
For this segment our solutions allow our customers like Coca-Cola, Pepsi and ABI to manage
their remote fleets of coolers (refrigerators). As an example, think about your corner store (dairy)
where you see rows of branded coolers. These coolers are not owned by the store but by the
brand and it is their primary sales tool.
We can help our customers manage the performance of their coolers in many cases without
visiting the store. We have over 3 million coolers connected to our cloud platform and can
provide performance information and smart notifications to take action.
In South and Central America, we have a high market share, approximately 75%, and our
primary strategy is to protect this share by bringing new solutions to the market, adding new
value for our customers. You can see some examples of these new solutions at the bottom of
the slide.
To grow in the CDE market segment our key strategy is to enter new geographies. In FY24 we
commenced a multi-year entry plan for the US, Europe and APAC where we have a low market
share. The approach for each geography is different due to the different business drivers,
competition and readiness to adopt technology.
Across the three regions, we have added pre-sales and services capability and have
successfully generated revenue in the US and APAC. ($1.3m and $2.7 m respectively). To be
successful in Europe and to grow faster in the US we need to launch a new solution, a single-

box cellular-connected controller with software that allows easy remote fleet management.
This product will be launched to the market this year with revenue expected in FY26.
2024 was a busy year of innovation and delivery of new products and solutions. Accelerating
new product development is essential to support our growth strategy. I will now discuss 3 major
new product releases from FY24 for the cold drink equipment segment.
The first is AoFrio® INSIDE™: AoFrio INSIDE is our comprehensive refrigeration solution that
integrates advanced hardware and software. It delivers up to 68% energy savings per cooler,
and it provides real-time, fleet-wide insights into energy usage and savings opportunities (Note
27% of this saving comes purely from using AoFrio technology, and the other 41% comes from
optimising technology supplied by others controlled by AoFrio INSIDE). This solution is key in
particular for entering the European market. We have several trials underway in Europe and Asia
for this solution.
The second new product is AoFrio® Gateway™. AoFrio Gateway is the next iteration of our
cellular solution, it was launched in the last quarter of FY24. It is supporting the shift towards
always-on cloud-connected refrigerators and significantly improves real-time two-way data
communication and action management. This communication hub enables the integration of
IoT devices, and secure data transfer to and from the AoFrio® cloud platform. It is a key product
for protecting our share in Latam and for entry into the new geographies.
The third new product launched was Third-party device integration
To enable our customers to have a complete view of their fleet in one platform we expanded our
platform to connect third-party devices.
We provided this solution to one of our biggest customers in Brazil. The customer had a diverse
fleet comprising both AoFrio and third-party controllers. Our unified solution now enables the
customer to manage performance across their entire fleet of coolers in a single platform.
In FY25 we will continue to launch new products to both protect and grow this segment
including:
• AoFrio®IQ™ which is a modernized, workflow-oriented solution, that improves the way
our customers interact with our software but more importantly allows us to add new
value more easily.
• A single-box solution with a controller and gateway combined that is essential to be
successful in Europe and the US.
• An advanced software solution for remote asset management and energy management.
These advanced solutions are our path to recurring revenue in this segment.

Greg:
The second part of our Protect and Grow strategy is in the Motors and Fans segment. Our focus
for this segment in 2024 was on expanding our range of motors and fans, integrating our motors
into the broader AoFrio ecosystem and developing new configurations for different applications.
We launched our ECR®2 26W- motor. This motor is specifically engineered for large bottle
coolers, supermarket display cases, and other applications that demand high power, moisture
resistance, and tolerance to high humidity, all while reducing energy consumption.
We have integrated ECR2 into the AoFrio INSIDE bundle, allowing it to work seamlessly with the
SCS controller for real-time optimization. It contributes towards increasing efficiency and
maximizing carbon reduction.
We have been successful in winning new business with our new application for hot water heat
pumps. This is a growing new segment for us and we are focused on building a pipeline of
opportunities.
In FY25 we will continue to release new variants (fan sizes) leveraging the ECR2 and ECR2-26 W
motors. These variants increase the range of applications that these two motors can support
protecting our market position.

Greg:
The second strategy element is Diversifying our market segment and the first new segment we
have chosen is food retail.
The food retail market segment is potentially a very large opportunity for AoFrio. The total
addressable market for temperature management solutions in this segment is estimated to be
$17B.
In the first half of FY24, we completed three proofs of concept. The proof of concepts intended
to ensure we had a detailed understanding of the customer requirements, that the technology
we used for the cold drink equipment market would work in these applications and that we
could provide significant value for the customer.
The three proof of concepts were in different sub-segments, convenience stores, supermarkets
and micro markets and different locations, NZ, Argentina and the US to ensure we covered a
range of applications.
As we expected we needed different hardware in some applications, and we needed to extend
our software solution.
After the completion of the proofs of concept, we addressed the hardware gaps and
commenced releasing new functionality for food retail in our software as part of our ongoing
software development cycles.
We are pleased that we were able to demonstrate value and each of the three proof of concepts
progressed to commercial proposals. One of these proposals has converted to a signed
contract and we have commenced implementation of the solution. We remain positive about
the other two proposals and expect to hear about these over the coming months. The structure
of these proposals is different from our cold drink equipment business with a focus on a
solution offer rather than hardware supply with recurring revenue.

We had planned for a more general release of our food retail solution in FY24; however, we
needed to prioritise our investments across the business and focused our food retail
investment on the three proof of concepts.
We have commenced planning for a more general go-to-market strategy for food retail and
expect to launch in accordance with that strategy in the later part of FY25. We are continuing to
assess and build a pipeline of potential opportunities and are positive about this segment.



Greg:
Transforming our foundations is the third pillar of our strategy.
On this slide, you see highlights from three main initiatives that fall under our Transform our
Foundations strategy.
ESG: Sustainability is an important focus for us at AoFrio. We are happy to report progress
across the three pillars and focus areas of ESG: Team, Operations and Product.
We achieved a diversity score of 88% up from 80% in 2023 and an engagement score of 79%, up
from 72% in 2023.
We have our sustainability systems and process audited by EcoVadis, an independent global
auditing organisation, and we received a Bronze Medal. This places us amongst the top 35% of
rated companies. Holding a rating from EcoVadis enables us to provide evidence of our system
maturity as requested by our customers. It also informs our sustainability improvement plan.
In FY24 we collected baseline data for reporting our scope 1 emissions. This data will also be
used for target setting. We also commenced integrating product circularity into our product
development and manufacturing processes.

People
AoFrio continued to prioritize its people as a key pillar. Our aim is to foster a diverse, strong and
healthy workplace culture across all levels of the business where individuals and teams are
able to their best work everyday. Key focus was on building alignment to strategy, global
collaboration and innovation capability.
SaaS Platform
We continue to invest in the modernisation of our SaaS platform so that we can get to a position
where we can offer advanced solutions to our CDE customers, provide a base for our food retail
offering and continue to leverage the rapid advancement in the use of data that machine
learning and AI present.
In summary we made good progress on our three core strategies in FY24. Protect and grow our
core, diversify our market segments and transform our foundations.
I will now hand over to John Scott, Chairman of AoFrio to share our FY25 outlook and a summary
of today’s presentation.


John:
2025 was a good year by any metric, $ & % growth but also the non-financial indicators
We have had six consecutive quarters of achieving market guidance giving us confidence that
the market is now “normal” & we know what we are doing.
There are macro-economic factors out of control & commentary on them is a fool’s errand, but
we are tracking & acutely aware & have mitigation tactics ready.
My definition of strategy is decisions that you make on a 2-year horizon, the do & do not do's.
With that definition, we are stable in our strategy & the execution of it. 2024 results allow us the

ability to stretch. For example, ARR has not been a key metric due to its size/significance but
will be a key metric the same was as Gross Margin or EBITDA today.
I have the privilege to see many companies & I am comfortable that we have a highly engaged
team that cares about the customer, this point alone is more important than strategy. Everyone
knows & accepts the Culture eats strategy for breakfast, but it is so often forgotten. In IT
companies the value is the Intellectual Property (IP) & the IP is the people.
Just want to finish with a big thank you to our customers for their ongoing trust & support & the
whole team for delivering the result.



Greg:
We will now address the questions. Just as a reminder. If you would like to ask a question,
please click on the Q&A tab at the top of your screen and type your question.