Guardforce AI Co Ltd (NASDAQ:GFAI) told investors it is customizing its robots by implementing artificial intelligence (AI) and other value-added applications to meet clients’ demands and requirements.
Releasing results for the six months to June 30, 2023, the company said it continues to receive feedback pertaining to its roughly 1,800 robots in use by clients. By integrating open-source AI models into its next-level solutions, Guardforce said it is confident that the implementation of AI increases service efficiency and lowers costs for clients.
The company reported an 8.7% rise in revenue to $18.4 million for the period despite a decrease in robotics AI solutions revenue due to the lasting effects of the COVID-19 pandemic. It attributed the increase to its Cash-In-Transit business, demand for its Guardforce Digital Machine, and additional revenue from Beijing Wanjia Security System, acquired in June 2022.
“During the first half of the year, we secured two long-term contracts with pre-existing clients for our secured logistics and cash handling services in Thailand,” Guardforce chairwoman and CEO Lei (Olivia) Wang commented.
“This past month, we secured a two-year contract with a pre-existing client for our end-to-end cash management solutions in Thailand. Furthermore, following our business strategy of diversifying our client base, in the past six months, half of our top 15 clients have shifted from banks to retail and chain stores, which are our main target clients in the AI and robotics sector.”
The company said it sees continued demand for robots with the latest AI technology and has a clearer go-to-market strategy and business model for robotics and AI implementations.
Partnerships
Guardforce AI recently partnered with security provider Concorde Security Pte Ltd to co-launch a new robotic security solution in Singapore that combines Concorde’s security solutions with its robotic AI automation.
In the hospitality industry, it has partnered with Blue Pin (HK) to launch the Smart AI Hotel solution, which allows customers to use its concierge robots to make bookings online, check-in, and check-out.
“We were also awarded an advertising contract for our innovative Artificial Intelligence of Things (AIoT) Robot Advertising (RA) in Macau,” Wang added.
“Our AIoT RA model enables advertisers to publish advertisements on Guardforce AI's robots and make more informed marketing decisions with data feedback from the Guardforce AI Intelligent Cloud Platform (GFAI ICP).
“We will continue to enhance and develop our robotic solutions with innovative AI technology for the hospitality and security industries and look forward to partnering with other companies within these markets to further accelerate growth.”
Other financial highlights for the period include an increase in gross profit to $2.5 million, from $1.9 million a year earlier, and an improvement in its gross margin to to 13.4% from 11.5% due to cost control initiatives and higher profit margin from our robotics AI solution business.
Its adjusted net loss amounted to $2.4 million compared with $3.04 million in 2022.
As of June 30, 2023, the company had approximately $26 million of cash and cash equivalents and restricted cash, up from $8.2 million on December 31, 2022.
Stronger balance sheet
During the period, it strengthened its balance sheet by raising proceeds of roughly $23 million. It also plans to convert $13.4 million of debt and $2.5 million of accrued interest in exchange for ordinary shares at a conversion price of $5.40 per share, which is more than a 29% premium to the previous closing price of its stock on September 28, 2023.
“The lender has been our long-term strategic partner and has been supportive of our business development,” Wang said.
“Given that the conversion price is at a premium to market, we believe this transaction is in the best long-term interests of the company and our shareholders.
“Overall, we are now in a much stronger financial position, significantly improving our balance sheet, and having built a highly scalable business model that we believe will drive significant value for shareholders.”
Contact the author at stephen.gunnion@proactiveinvestors.com