Join shortly. Just a reminder that if you did want to ask a question, please submit it through the Q&A button down the bottom of your screen or, for analysts, you can raise your hand and I'll allow you to talk.

Glenn is going to run us through more so the financials as part of the quarterly first, and then we expect Glenn to join shortly. Thanks very much, Paul.

Thanks, Simon, and good morning and good afternoon to everyone. Thank you for joining our third quarter performance update.

We published our results earlier today, hopefully you had a chance to look at the document. We're not presenting slides today.

I was actually going to talk you through the handout that's been published on our website as well as the NZX and ASX. Overall, we've had a very strong third quarter, continuing on from the strength that you saw in the second quarter.

At a very high level, our subscription revenues continue to grow at a 35% growth pace. You'll see that in some of the slides that we have.

We're also seeing continued improvement in gross margins, which creates operating leverage for us as a business. We do that with a healthy balance sheet that we're investing into new products, which are on track for release later in our calendar year.

I'm going to jump to the financial part of the presentation, and it's the section that's titled Performance Summary. I'm going to start with what we call our exit run rate, or annual recurring revenue trend.

You can see that through the nine months year to date, we finished at NZ$21.1 million. That's an increase 35%—it's actually 36% in constant currency.

We had a little bit of a impact from the US dollar/New Zealand exchange rate. That represents about a 39% three-year annual compound annual growth rate.

Subscriptions is where the business is predominantly focused, and you can see that as we continue on that growth trend. One thing of note, we launched a product called ikePOLEFORMAN literally two years ago, and that product exceeded $10 million of that exit run rate ARR.

Really pleased to see the strength of POLEFORMAN in our numbers continue as we report today. If I go to the next chart, we look at subscription revenues.

This is our recognized subscription revenues, again, nine months year to date. We finished year to date at $14.1 million.

That's a 38% growth rate over the year-to-date period from the prior year. What's not on the slide is we actually did about $5.3 million in subscription revenue in our third quarter, which is actually a 43% year-over-year growth rate.

You can see from those two slides, subscription revenues continue to grow and the pace is picking up. In the third quarter, we added about $2 million of ARR.

A lot of that comes from new logos. We continue to win engineering and utility new logos.

We're also expanding significantly the portfolio into our existing customers. That trend and that business model continues for us.

If I go to the third slide, which is the seat-license trend, the majority of our sales are sold on an annual-per-seat basis and annual-per-user basis. Seats grew at 30%—30% year-over-year.

We're also seeing an increase in our average revenue per unit, and a lot of that has been helped by a recent release of our AI-based Pole Pal, that's sells as part of our IKE Office Pro product line. Seat growth continues well, the pricing continues well underlying those seats, continued growth there.

If I go to the next slide, it's our transaction or services business, and you can see that we had some weakness there in our services revenue. If you remember from prior calls, a lot of our services customers are broadband communication companies.

The US government had a reset on funding for some of those companies, a lot of the funding is there, but it's being delayed just through legislation changes, and we're seeing that in some of our service business. You can see that in a year-to-date numbers, we're down year-over-year both on the number of poles that we count in our transactions, as well as the services revenue.

We have made moves to restructure the team that supports this business. We've offshored a lot of the work, we are seeing improved gross margins in services, which adds to operating leverage across the company.

I'll jump next to the segment revenue, you can see the NZ$19.8 million of revenue that we're at year to date and how that is broken out. The recurring piece, which is our subscriptions, and a reoccurring piece, which is the transaction revenue, sits around 90% of our total revenue today.

You can see that for the year to date, we grew revenues around 7%, and year-over-year for the quarter, revenues were up around 11%. Continued growth across the revenue, but clearly the mix is the subscription piece of the business.

I'm going to, before we get into questions or if Glenn joins, I'll just finish with the metrics chart and just make some comments on it. This is the table at the back.

Gross margins continue to improve. You can see 79% versus 68%.

The subscription mix helps that. The restructuring we've done in the transaction services business helps that.

That creates leverage that we're using to invest in some new products, as well as on our path to EBITDA-positive. That table gives you a sense of not just the overall margin of the business, but how the margins of our product lines stack up.

You can also get a sense of our customer counts, as well as revenue and margin by segment. I'm going to close there with just comments that it's a solid quarter.

We see a similar early signs in our fourth quarter, which started in January, and we continue to book business and we're off to a relatively strong start as we embark on the fourth quarter and the final quarter of our FY 2026. With that, Simon, I'll hand it back to you.

Perfect. Our first question is from James Lindsay at Forsyth Barr.

James, please go ahead.

Simon, and congrats, Paul. Hey, I just wonder if I could just ask a few questions.

Firstly, just with regards to, I suppose, the more disappointing performance on that transactional side of things, if there's anything in there with regard to sort of when that could turn around?

It's a good question, James. From a macro standpoint, we are hearing that a lot of the companies that got funded had to reapply and are starting to see funding coming through.

Also, from a sales pipeline perspective, we're starting to get line of sight to some large projects. Timing is unsure at this point, but thinking March-April timeframe.

Certainly, we're seeing more deal activity in our pipeline, I would say, in the last couple of months than we've seen maybe in the earlier parts of this year. Early signs that it could start to happen in first quarter.

Thanks for that. Obviously the gross margin in that side, that transactional side of the business has actually been relatively volatile, but for this quarter, it looked to be up a reasonable amount.

Could you give us any sort of headway about why it is so volatile?

Part of the volatility is we took some one-time restructuring in the second quarter, you would have seen, I would say, relatively low margins tied to some restructuring that we did with the team. Then the third quarter was our first full quarter where the majority of the work in this business has been offshored.

We had an offshore model for some of the work that we do in services, but the third quarter was really the first quarter that we saw a full quarter of work being done offshore. It's not just lower cost, it's also more of a variable model in that we only incur costs when we incur the work.

We have less fixed costs in that model as well. You're really seeing the effect of the offshore move that we've made.

That's that Mexican team that you're talking about?

That's correct, yep.

Yeah. Great.

Just with regard obviously balance sheet in a really strong position post the capital raise, and just with regard to the spend that's going on on R&D, can you talk about, yeah, sort of the mix of what's going on and the spend and sort of full year? Will that start to accelerate in the next quarter or so?

It will definitely start to accelerate. We've started to onboard some new employees, tied to our PoleOS initiative.

Part of what we're driving, I think, is a fairly significant platform strategy, and we started to onboard some resources, engineers, both here in the US and in New Zealand starting in January. Then we've got some additional hires coming in February.

You'll see the spend tick up, but it's not reflected yet in our third quarter because the headcount is starting to come in this quarter.

Got it, thanks for that. Obviously well done.

I think, if I look at the numbers right, it might be your third-best quarter ever as far as that 25 net customer growth. Just interested in the mix of that and what do you think has driven it?

Is that sort of more PoleForeman or is it just in core product? Where is that mostly come in?

Two areas that I've seen in the third quarter, James. One is the ecosystem of companies that use PoleForeman continues to expand, think about a utility not just rolling out PoleForeman in more departments, but also the engineering firms that support those large utilities.

We're seeing, I would say, kind of a flywheel effect on that in terms of both subsegments, the engineers and the utilities buying more PoleForeman. I would also say that we saw an uptick in IKE Office Pro in the third quarter.

Pole Pal has helped. We're starting to have customers take the new version with the AI-enabled Pole Pal.

We ran a hardware trade-in program where customers could trade in old hardware and trade up to newer hardware with IKE Office Pro licenses, and so we're seeing a lot of the benefits from that on the IKE Office Pro side as well.

Right. You mentioned just Pole Pal, maybe while you're on that, as far as sort of the customer feedback on that and if there's been any sort of fight back on the increase in price that you're putting into customers for that product?

Far, we've had about 30 customers license it with no pushback on the price, and overall the feedback's been super positive in terms of time savings they're seeing by being able to use that functionality.

Is there anything else in market that sort of comparable to that?

Maybe a Glenn question, but certainly we haven't seen anything crop up just yet now that we've launched Pole Pal in the market.

Right. Actually, the other thing I was going to ask about, the customer base.

I know there's always a very big mix of size potentially there, and maybe when you're saying about the network effect, if it's sort of associated companies to the utilities, it's possible that the size of the 25 net new customers is maybe smaller than the average that you've got to date. Would that be fair to say?

I would run an 80/20 on it, James, and say that 20% of those net new give us, I would say, material size of deal, meaning high five-figure, high six-figure kind of ACV, annual contract value, deal size. Then the other 80% quantity is maybe more of the smaller engineering firms that maybe take a smaller amount of licenses and then expand over time.

Right. Then last one for me, it might be more of a Glenn question as well.

Thanks again for the heads-up on that sort of nine months for that Module 1. Have you got any indication about how long pilot testing would take before sort of a market introduction?

I know that, basing on what we did with Pole Pal, and that Module 1 is, I would say, it's an adjacency to what PoleForeman does, but it's a different subsegment. I would say that if I follow what we did with Pole Pal, it's likely to be a 60- to 90-day beta.

We'll put in customers' hands and get feedback on very quickly. Typically two to three months is what our beta period is, but we have more development work to do before we get to that.

Great stuff. You mentioned, sorry to carry on, I'll pass it back to Simon shortly, and I think in the raising presentation, you talked about around about $11 million, I think if I recall, for the two modules.

Is that still on track or is there any sort of change in the view about what will need to be spent?

The only change that I would say that's material is we're, I would say, fast following in terms of our adoption of artificial intelligence, and I would say that that is improving the way that we develop and leading to a faster development cycle. We haven't quantified the impact yet, James, but certainly we're leaning into, I would say, faster AI adoption that could help accelerate the development, which ultimately would lead to lower cost, but I don't have a number that I can give you at the moment.

Great stuff. Thanks for that, and I'll pass you back.

Cheers.

Thanks, James. Our next question is from James Bisinella at Unified Capital Partners.

Go ahead, James.

Thanks, Simon. Hi, Paul.

Congrats on the result. Lots of ground covered there.

I might just ask a couple. Just on sort of the pipe, you mentioned some strength coming through there.

Just keen to hear a bit more color kind of in the potential makeup of that. Obviously, some large deals signed in the past.

You do have eight of the 10 largest IOUs at the moment. Is this a makeup of sort of larger deals, a combination of smaller ones, or just any further color there would be helpful.

Thank you.

Just to clarify, James, are you asking for results to date or more the pipeline that we're seeing as we move forward?

More so the go-forward, yeah.

We look at the pipeline constantly, and I would say that we have very good coverage of the bookings that we need to close to hit that 35% guidance. We're laser focused in on the pipeline that we have, the deals that we have in that pipeline.

I would say we have between eight to 10 material deals of significant size that make up, I would say, maybe about half the pipeline. We don't need to close all those deals to hit our 35% run rate, but my point is potential deal flow is still very healthy, and I would say it's a mix of large five-, six-figure deals in the eight to 10 category, and then the rest is smaller deals.

No, that's great. That sounds very supportive.

Then just another one from me, just last one, just on kind of the ARPUs of the new product, the one that's nine months away. I think kind of blended ARPUs at the moment are around the $2,000 NZ mark, just keen for any color on ARPUs of this new product and what we could see out of that.

We haven't priced it yet, but to give perspective, rounded up, US$2,000 is our PoleForeman ARPU. Our feeling is that the new product adds significantly more of a value proposition than PoleForeman.

We haven't priced it, but I would think that it would be well north of the $2,000 USD we have today for PoleForeman.

Excellent. That's it for me.

Thanks, Paul.

Thank you.

Thanks, James. Next question: Congrats on PoleForeman reaching $10 million ARR.

How much approximately is the total achievable ARR for PoleForeman just from your existing client base? Is the customer take-up of PoleForeman still accelerating?

It's still accelerating. I would say that the revenue potential is still significantly higher.

I know that in prior calls, we've shared market penetration and penetration within our accounts. The short answer is in the next 6 to 12 months, I think the potential for PoleForeman is still there.

We're not seeing a slowdown, and the pipeline that we have suggests there's still not a slowdown. Without throwing a number on it, Simon, I would say the potential and the upside is still significant for PoleForeman.

Great. Thanks, Glenn.

Just a question: Under what circumstances do you envisage that the company might raise more capital in the next few years?

I would say it's based on a strategic direction more than financial need, if that makes sense. Today we're tracking to get the business to EBITDA-positive.

The increased gross margins give us more and more leverage. As we grow that margin, we've got more to invest to further the strategy, but to me it would be strategic reasons that would lead to potential capital raise, meaning is there subsegments we could get into through an acquisition, as an example.

Today I would say we're heads down executing on the strategy we have, and it would be something strategic that would lead to the need for a capital raise. Great.

Thanks Paul. That concludes the Q&A segment.

Thanks very much for stepping in again, and if there's any further questions, details are at the bottom of the ASX and NZX announcement. Hope you all have a good day.

Thanks, Paul.

Thank you. Bye.