31 March 2020 – Perth Australia
Nuheara Limited (ASX: NUH) (Company or Nuheara) advises that as a result of the rapidly evolving situation worldwide with regards to COVID-19, the Board has implemented a number of temporary business stabilisation measures to ensure that the company is well positioned operationally and financially to manage the current economic uncertainty and business interruption.
Of primary importance has been the safety of employees and their families, and the company has been proactive in implementing recommended and required workplace protocols to minimise the risk of spreading the virus. The escalating restrictions being imposed by governments worldwide, particularly in Malaysia where Nuheara hardware is manufactured, have required the Board to implement further measures to ensure the Nuheara business remains in the strongest possible financial position during the temporary interruption caused by COVID-19.
Pre-orders for IQbuds² MAX sales have remained strong and ongoing since they were launched at CES in January 2020, reaching more than 2,500 units. Daily sales are continuing and Return On Advertising Spend (ROAS) has also remained resilient at over 2x. As these sales are all originated by Nuheara’s direct to consumer (DTC) online platform, COVID-19 related restrictions are not expected to restrict deliveries.
Nuheara had secured its supply chain for the first 6,000 units and had commenced production of IQbuds² MAX in Malaysia. However, the current Government lockdown in Malaysia has ultimately interrupted manufacturing activities. The Company is closely monitoring the situation and is working with manufacturers and suppliers to ensure product deliveries can commence as soon as possible when restrictions are lifted.
In the interim, Nuheara will temporarily stand down employees in non-essential functions. In addition, all senior executive remuneration will be reduced by 50%. This includes the Nuheara CEO and will be matched by the Nuheara Board. While manufacturing activities remain constrained, Nuheara has also refocused and reduced advertising spend to more effectively manage available distribution capability. These measures will be reviewed at 30 June 2020. As this remains a rapidly evolving situation, the Board will continue to monitor and respond as appropriate.
“Globally and in Australia we have seen businesses respond swiftly to the COVID-19 situation. We don’t take this decision lightly, but we are looking at maintaining longer term business stability,” said Nuheara CEO Justin Miller.
“We have developed a product that can change people’s lives for the better and have customers that have continued to trust us with new orders – even in very difficult times. Our global DTC model is proving itself as a viable hearing alternative as we see traditional hearing clinics shutter around the world.
“We have built a dedicated and skilled team over many years that have helped make this Company what it is today. I can assure our customers and our employees that the measures we are taking are designed to preserve these strengths and ensure we are best placed to resume normal operations quickly when this crisis is over.
“I would like to thank our employees for their understanding, our customers for their patience, and our loyal shareholders for their continued support in this difficult time for all.”
This announcement has been approved for release by the Board of Nuheara.
Media and Investor Relations: Shane Murphy, FTI Consulting
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Nuheara is a global leader in smart personal hearing devices which change people’s lives by enhancing the power to hear. Nuheara has developed proprietary and multi-functional intelligent hearing technology that augments a person’s hearing and facilitates cable free connection to smart devices. Nuheara is based in Perth, Australia and was the first consumer wearables technology company to be listed on the Australian Stock Exchange (ASX).
In 2016, the Company released its revolutionary wireless earbuds, IQbuds, which allow consumers to augment their hearing according to their personal hearing preferences and connect hands free with their voice-enabled smart devices. Nuheara products are now sold online and in major consumer electronics retailers, professional hearing clinics and optical chains around the world.
The Company’s mission is to transform the way people hear by creating smart hearing solutions that are both accessible and affordable.
Learn more about Nuheara: www.nuheara.com