Ann: Swift Signs Agreement with DXC Technology, page-8

I wasn't expecting a deal with a US company. I thought the expansion plan was going to be focused locally and also in SE Asia. This makes this business even better than I originally thought, if they are now going for growth in the US - not to mention that scaling in the US must be manageable.

I bought in in the low 30's and I topped up today at 45c.

The main reasons for an investment are the following:
- Low churn (hospitality, aged-care and mining clients will not break the contract once the service is embedded and offered to their patrons)
- No MGs (this is massive - negotiating no MGs on tier one content contracts is a feat. MGs sent Optus Vision broke many moons ago). Further upside here as CPS (cents per subscriber) contracts switch to fixed fee agreements, and incremental revenues will drop to the bottom line.
- Increasing market (tailwinds from the ageing population, time poor Gen Xs make communications online into home more critical)
- Experienced management - I heard Xavier Kris talking about a previous business, which from memory he 10X in 5 years. This is his next chapter. Also, they are proving to be reliable managers and able to convert leads into paying clients.
- Little / no competition - Foxtel will not play in these fields directly as it will not move the needle for them. More likely they will just buy out SW1 if it grows appropriately. (Also may be purchased by a mid tier telco).
- Compelling content offering, cheap- Not just crappy channels that serve a niche, SW1 have in place the best of the best. Makes it easy to convert leads to subscribers. Further reduces churn as termination of the service leaves one with 'content anxiety' - its not possible to switch to another provider without significant loss of variety.
- Little capex - utilise Amazon Web Services to keep costs low, scale and implement quickly and pass on the costs back to back to their customers. This will reduce CAPEX requirements and ultimately mean strong free cash flows in the future.
Further, inventory (i.e. set top boxes) are sold to and owned by the end customers, not leased to them - so SW1 does not bear technology obsolescence risk or need to find working capital to fund growth.

Big tick from me. Go SW1!
Good luck to holders.