Late night disclosure for Dubber’s $18.5m accounts hole
The Alex Waislitz-backed cloud call recording software outfit says it has ‘reversed’ previously claimed revenues and failed to collect millions more from one of its customers.
Call recording software company Dubber has disclosed an $18.5m hole in its balance sheet in an ASX filing late on Friday evening.
In a note just before 8pm, the company – which had reported unaudited earnings in late August and counts billionaire Alex Waislitz – said it had “reversed” $10.3m previously classified as revenue.
Its auditors, BDO, said it had found three areas needing amendment – revenue recognition, recovery of receivables and an impairment assessment.
“Management’s assessment that the likelihood of the group collecting this consideration to which it was entitled to under the contracts was not probable,” said Dubber chairman Peter Clare of the $10.3m which the company no longer counted as revenue.
Dubber said it had also failed to collect a further $8.2m from a “single customer”. But Mr Clare said Dubber continued to do business with that client, describing the relationship as “sound”, despite the non-payment. Combined, the two amounts total $18.5m.
“General and administration costs have been adjusted … for a single debtor in the amount of $8,160,944. This has been done due to failure of this customer to make contractual payments, the company deciding to provide for the full amount,” Mr Clare said.
“The company notes that its relationship with this partner is sound and expects that there will be revenues from this relationship in future periods.”
When it initially released its results in August, Dubber talked up its relationships with Optus and Telstra, and said it had established “partner agreements” with NuWave and Zire in North America and Nuuday in Denmark.
“Dubber expanded its carrier footprint with the launch of native mobile call recording for Optus, initially aimed at enterprises in the financial service sector,” the company said at the time.
“Dubber also extended its Telstra relationship and is now available via Telstra’s enterprise billing system and sold by Telstra’s direct and indirect sales channels/
“The company is confident in its strategic direction to extend its relationships with current service providers globally, expand the Foundation Partner program and secure new relationships with existing carriers and emerging providers where there is increasing demand for its services.”
The new, audited accounts show Dubber generating $25.3m in revenue in the year to June 30 and a net loss of $83.2m.
“The board does not consider that these changes materially affect the future financial performance or financial position of the company,” Mr Clare said.
“All the changes are non-cash and relate to the accounting treatment of revenue recognition, employee based share plans, provisions for doubtful debts and depreciation and amortisation.
“Actual cash receipts for FY2022 are unaffected and remain at $29.9m and cash receipts for the September 2022 quarter are $9.5 million, which is the highest recorded by the company.”
Dubber’s investors include Alex Waislitz’s listed investment company, Thorney Technologies. According to Thorney’s annual report, it had $1.79m invested in Dubber, representing 1.4 per cent of its gross assets as of June 30.
Mr Waislitz said Dubber had been “successful in securing key strategic partnerships internationally for its proprietary technology” and was on a “path to … profitability”. But he conceded its share price had underperformed.
In the past year, Dubber’s shares have dived 83 per cent to 55.5c, giving it a market value of $168m. This compares with a 7.4 per cent drop across the market.
Dubber chief executive Steve McGovern said in August the past year had been “transformative” for the company. “We came into (this financial year) focused on growth and achieved it at the same time as transforming the infrastructure and operations of the business,” he said at the time.
The company has been suspended from ASX trade since October 3 because it had not lodged the required audited annual report by its due date.
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