SYTA - Not a growth story.


Siyata Mobile Inc. (SYTA) is a provider of vehicle mounted mobile communications platform (Push To Talk Over Cellular ("PoC") devices). Coverage was initiated on March 2017 with notes on June 2017, July 2017, October 2017, November 2017. May 2018, October 2018 and April 2019, January 2020 and August 2020. Below is an update.


New Releases


Aug. 20 - Aligns with Vive Wireless and Receives Initial Purchase Order: to engage in multiple opportunities for the Uniden UV350 in conjunction with an initial purchase order from a leading Canadian construction company.


Aug. 27 - Present at the LD 500 Virtual Conference September 1st-4th, 2020

Aug. 31 - Signs Distribution Agreement with Insight: A distribution company supporting the modern workforce by simplifying device management for distribution of the Company’s cellular booster line of business.


Q2 Earnings: Estimates filing of the interim financial statements and MD&A no later than September 30, 2020.


Sep. 11 - Halted: At the request of the Company Pending News.


Sep. 14 - Announces U.S. Registration Statement Filing: filed a registration statement on Form F-1 with the U.S Securities and Exchange Commission . The proposed Offering contemplated by the F-1 is an initial public offering in the United States of units of the Company (collectively, the “Units”) consisting of one post-consolidated common share in the capital of the Company and one warrant to purchase one additional post-consolidated common share.


The final terms of the Offering have not yet been finalized but will be completed following a proposed share consolidation or reverse split of the Company’s issued and outstanding common shares.


The proposed Offering and Consolidation remain subject to the receipt of all necessary regulatory approvals in Canada and the United States. The terms of the Offering and the final Consolidation ratio also remain subject to Siyata’s Board approval and the approval of the underwriters.


Sep. 14 - Resume Trading.


Sep. 15 - Launches “Hero Series” Portfolio: “Uniden® Hero Series” line of cellular signal boosters dedicated to first responders in the USA, who rely on cellular connectivity on the front line to save lives and protect our communities.


Sept. 23 - Initiates Share Consolidation as Part of Recently Announced Strategic Initiatives: proceed with the consolidation of the common shares of the Company on the basis of 145 pre-consolidation Shares for one (1) post-consolidation Share (the “Consolidation”). The Consolidation will become effective at the close of market on September 24, 2020 and the post-consolidated Shares will commence trading at the open of the market on Friday September 25th.


Sep. 24 - Halted: At the Request of the Company Pending News.


Sep. 25 - Announces Pricing of its Upsized US$12.6 Million U.S. Initial Public Offering: announced the pricing of its U.S. initial public offering of 2,100,000 units at a price of US$6.00 per unit. Each unit consists of one common share and one warrant to purchase one common share.


The Company intends to use the net proceeds from the offering for sales and marketing, growth capital, research and development with the remainder, if any, for working capital.


Sep. 25 - Resume Trading.


Sep. 30 - Announces Closing of its Upsized US$12.6 Million U.S. Initial Public Offering on the NASDAQ:Received gross proceeds of approximately US$12.6M, before deducting underwriting discounts and commissions and other expenses.


Psagot Investment House was the lead investor in the Offering. Psagot Investment House is an Israeli investment firm and the country’s largest pension fund manager. Controlled by Apax Partners since 2010, it manages US$40 billion.


The Company intends to use the net proceeds from the offering for sales and marketing, growth capital, research and development with the remainder, if any, for working capital.


Sep. 30 - Report Q2 2020 Financial Results on or Before October 13th, 2020

Oct. 6 - Signs Distribution Agreement with Award-Winning Wireless Integrator. Source Inc.a wireless integrator and part of the Verizon Elite Partner Program that focuses on Verizon sales and activations in the United States. During Q4 2020, Source Inc. will run a special promotion on the Uniden UV350 in-vehicle communications solution device.


Oct. 13 - Appoints LaRue Martz as US VP Sales for Uniden® Cellular Signal Boosters.


Oct. 13 - Reports Q2 Revenue of $2.95M, a 47% Increase Over Q2 2019.


Oct. 16 - Announces Delisting from TSX Venture Exchange: effective at the close of market on Monday, October 19, 2020, the common shares of the Company will be delisted from the TSXV, at Siyata’s request.


Oct. 20 - Receives USD$650,000 Order to Equip Homeland Security with its Rugged Devices: USD$650,000 purchase order to equip homeland security in the Middle East with its handheld rugged Push-to-Talk (PTT) devices.


Oct. 22 - To Host Live Webinar on Thursday, October 29, at 2:00PM EST.


Oct. 26 - Announces Change to Board of Directors: Mr. Peter Goldstein to its Board of Directors.

Also announce the resignation of Richard Hoy from its Board of Directors.


Oct. 28 - Collaborate with FleetComplete for FirstNet to Help Enhance School Bus Transportation Safety:


Fleet Complete for FirstNet is a collaborative solution between AT&T and Fleet Complete.This Fleet Complete for FirstNet solution consists of a FirstNet Ready™ Uniden® UV30 in-vehicle mobile device that can take advantage of Band 14 and two FirstNet Certified™ apps in the FirstNet App Catalog: Fleet Complete Mobile and Fleet Complete Dispatch.


Nov 4 - Announces Partial Exercise of Over-Allotment Option: underwriters, have partially exercised the over-allotment option. As a result, the Company has issued 120,000 additional common shares in the capital of the Company and 266,000 additional common share purchase warrants for aggregate gross proceeds of USD$721,460.


The Company intends to use the net proceeds from the offering for sales and marketing, growth capital, research and development with the remainder, if any, for working capital.

Summary


SYTA finally achieved its objective of listing on the NASDAQ. However, it was done in a questionable manner.

Consolidation

On September 14, SYTA announced that it filed a form F-1 with the SEC. At the time, the company indicated:


The final terms of the Offering have not yet been finalized but will be completed following a proposed share consolidation or reverse split of the Company’s issued and outstanding common shares.


On September 23, SYTA disclosed its ratio consolidation of 145 to 1. The following day Siyata Mobile halted its stock.

In essence freezing the 52 week low stock price ($0.065) on the TSXV for the IPO on the NASDAQ.


A few things to be noted here. Going back to the Q1 2020 earning call (July 2. $0.115 cents), SYTA's CEO mentioned that the consolidation would occur at a "much higher price". Also looking back into the EDGAR archives, the intent to file for an F1 was documented as far back as September 8 with the original filing on August 24.


Hence, Siyata Mobile did not disclose the information via press release on the TSX Venture for three weeks.


NASDAQ Listing/Financing

On September 25, SYTA initiated its IPO on the NASDAQ for $12.6M USD. On September 30, SYTA closed the offer:


Psagot Investment House was the lead investor in the Offering. Psagot Investment House is an Israeli investment firm and the country’s largest pension fund manager. Controlled by Apax Partners since 2010, it manages US$40 billion.


Again, going back to June 30 shareholder letter, the following was mentioned.


After meeting with numerous relevant US funds and investors over the past several years, we believe this will open up opportunities to buy our securities from the thousands of microcap funds, family offices and retail investors that currently do not trade on the TSX Venture Exchange or OTC. With this in mind, our securities will continue to trade on the TSX Venture Exchange regardless of our status on the NASDAQ.


The fact that Psagot Investment (an Israeli Investment Firm) took 15% ownership of the company at multi-year low price is quite a departure from the "US funds and investors" narrative. Moreover, on October 16, three days after releasing its Q2 2020 earnings, SYTA de-listed itself from the TSX Venture.


On October 22, SYTA hosted a live Webinar, from the $12M USD IPO, SYTA reported $4.9M USD remaining.


This in part explains SYTA's recent announcement where it exercise its Partial Exercise of Over-Allotment Option. Which should boost its Net Cash portion by another $0.72M USD.


Earnings

On September 30, SYTA disclosed that its Q2 Earnings (Ending June 30) would be released on or before October 13th.

On October 13, earnings were released with no conference call provided. This is rather unusual, SYTA has traditionally held conference calls on the TSX Venture. Now that it trades on the Nasdaq, none. No rationale was provided for this.


Setting aside the matter of Consolidation, NASDAQ Listing and Financing, the earning to date speak for themselves.











Though SYTA has yet to file its Q3 2020 Earnings, its uncertain that it will be able to match FY 2019 or FY 2018.

Almost a year ago (see 3:10), SYTA's CEO claimed that sales would grow by 200 to 300% in 2020.

Possible? Perhaps, no one knows what Q3 2020 will bring yet. Likely? Probably not.


In Short

SYTA has met the goal of trading on the NASDAQ but is still very much a venture company that has yet to be profitable.


SYTA did not "graduate" on merit, it consolidated its way there at a 145 to 1 ratio. This consolidation was not vital for the company as it was not going bankrupt and could perfectly well raise funds on the TSXV.


It's clear that the NASDAQ listing was mostly to consolidate ownership towards Israeli investors. More importantly, the fiscal year earnings from 2018, 2019, and 2020 to date indicates that SYTA is simply not a growth story.


This end our coverage of SYTA.


DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

The content of rally is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions - rally cannot take responsibility for your investment decisions.

359 views

 Financial Research and Quantitative Trading for CSE* & TSX Venture Investors

If you enjoy this article consider making a one time or monthly contribution through PressPatron. We accept anonymous donations, no matter how small the amount. We are committed to be a paywall-free independent news source for investors. Thank you for your support.

And Readers like you.

PressPatronLogo_2.png

Powered By

Subscribe to our Free Weekly Updates

  • LinkedIn Social Icon
  • Twitter Social Icon

Copyright © 2017-2020 rally. All rights reserved.