Arqit Quantum (ARQQ) - 2023 Q4 - Annual Report

Financial Performance - Arqit generated $5.6 million in revenue and other operating income from discontinued operations for fiscal year 2023, down from $20.0 million in fiscal year 2022[12]. - QuantumCloud revenue totaled $639,968 for fiscal year 2023, significantly lower than $7.2 million in fiscal year 2022[12]. - The operating loss for fiscal year 2023 was $84.4 million, compared to a loss of $63.7 million in fiscal year 2022[15]. - For the year ending September 30, 2023, Arqit reported an IFRS loss before tax of $74.0 million, compared to a profit of $53.4 million for the same period in 2022[24]. - The adjusted loss before tax for the same period was $84.7 million, an increase from $64.0 million in the previous year, reflecting a year-over-year increase of approximately 32.5%[24]. - Cash and cash equivalents at the end of fiscal year 2023 stood at $44.5 million, down from $48.9 million at the end of fiscal year 2022[16]. - Total assets were reported at $99.8 million, which included cash reserves of $44.5 million[25]. - As of September 30, 2023, total liabilities amounted to $33.1 million, with $6,519 related to outstanding warrants classified as liabilities[25]. - The change in fair value of warrants was a loss of $10.6 million for the year ending September 30, 2023, compared to a loss of $117.4 million in the previous year[24]. - Arqit emphasizes that the adjusted loss before tax is a non-IFRS measure and should be considered alongside IFRS measures for a comprehensive view of financial performance[23]. - The company acknowledges the limitations of non-IFRS financial measures, which may not be comparable to similar measures used by other companies[22]. Operational Developments - The company signed 13 channel partnerships in fiscal year 2023, with 8 established in the second half, leading to revenue generation through 6 of these partnerships[1]. - Arqit introduced three specialized applications: NetworkSecure™, TradeSecure™, and WalletSecure™, targeting specific vertical markets[4]. - Arqit aims to fully activate its channel partnerships to drive product adoption and revenue growth[11]. - Arqit expects to announce additional channel partner relationships to further expand its market reach[2]. - The company has reclassified its satellite assets as "held for sale," impacting the reporting of income and expenses[6]. Risks and Forward-Looking Statements - Forward-looking statements indicate potential risks including legal proceedings, competitive industry changes, and operational performance variations[26]. - The company does not intend to update or revise forward-looking statements after the date of issuance, highlighting the inherent uncertainties[26]. - Arqit’s financial performance is subject to various risks that could materially affect future results, as outlined in their annual report filed with the SEC[26]. Expense Management - Administrative expenses decreased to $55.2 million in fiscal year 2023 from $71.0 million in fiscal year 2022, primarily due to lower share-based compensation[14].