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ASX Queries Actions Of LIFX Company Again

The Australian Stock Exchange has again been forced to question the actions of Buddy Technologies whose consumer business trades under the LIFX brand, management were asked whether they should still be listed on the ASX.

In a letter sent on Nov 4, 2021, the ASX queried the 2021 annual report, their share-based payments, and the timing of information announcements following their recent capital raising.

The Company responded claiming that BUD’s updated business plan, which includes a restructuring of the business, included implementing various measures to continue to reduce expenses whilst seeking to grow revenues through (amongst other matters) resolving the Companies inventory constraints.

BUD’s claimed that they had cash reserves of A$2.1 million as at, 30 September 2021 and that this is sufficient to warrant continued quotation of its securities and its continued listing on the Official List of ASX.

In the past, serious questions have been raised about the information that the LIFX Company supplied to shareholders, after it was revealed that manufacturing partners for their smart lighting products had sold components because they had not been paid and that the business was bleeding cashflow due their inability to supply stock.

This resulted in the business struggling to supply retailers such as JB Hi Fi in Australia and Best Buy in the USA.

The business received applications for 8,818,184 new shares, for an aggregate subscription amount of $220,455.57 before the ASX query.

The raising was part of Buddy’s plans to settle accounts owing with its primary manufacturer Eastfield Lighting (Hong Kong) Limited.

The company agreed to pay Eastfield US$2.75 million via proceeds from a $6.5 million placement, the entitlement offer and via the issue of 4.25 million convertible notes to its lender Partners for Growth (PFG) to raise US$4.25 million.

The business claimed that debt refinancing, and funds raised by the issue of the convertible notes would decrease Buddy’s unaudited current liabilities at FY20 by A$9.4 million to A$22.4million.

The Company admits its experiencing some component delays due to the global semiconductor shortage.

Only 655,000 of the 1 million pieces of critical components used in the manufactured of LIFX smart products have been delivered to manufacturers to date.

Around 458,000 pieces were expected to be delivered in September, with a further 180,000 pieces expected in October – for a total of nearly 1.3 million pieces.
Currently JB Hi Fi is listing 29 LIFX SKU’s.

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