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Software specilist, K2fly Limited (ASX: K2F) has announced on 23 March 2020 that, with the signing of Newmont Inc, new contracts for the RCubed Software Solution have now passed the second contracted ‘net new annual revenue’ acquisition performance milestone. The Company has reported this significant achievement within 9 months from the date of acquisition of RCubed, completed in May 2019.
K2fly secured the Newmont contract in March 2020 and consequently, new or additional RCubed Annual Recurring Revenues (ARR) have reached AUD 1,017,352 since May 2019 while additional contracted implementation revenue is at a minimum of AUD 1,031,600.
Furthermore, K2fly had already surpassed Year 1 new ARR acquisition performance milestone of AUD 500k in November 2019, with the signing of Rio Tinto and Nexa Resources. It is also noteworthy that nearly 75% of the current contracts for RCubed are in the US Dollar, which is highly beneficial for the Company with the depreciating AUD and given most of K2fly’s costs are denominated in AUD and ZAR.
Most importantly, despite the recent headwinds sweeping across the global business and economic landscape, demand and interest in the RCubed Software Solution has not waned, highlights Nic Pollock, K2fly Chief Commercial Officer. This can be attributed to RCubed being regulatory-driven and companies still have ongoing reporting obligations for their mineral resources and ore reserves.
Moreover, K2fly’s RCubed implementations require little to no time on site and can be adapted to be fully implemented remotely, accommodating the current world circumstances.
K2fly SaaS-based business segment now has a wide international client base including leading global mining group Rio Tinto, Canada-based Teck Resources, Nexa Resources, Westgold Resources Limited (ASX: WGX), Glencore Canada Corporation, and others.
Highlights of K2F’s SaaS contracts which includes both Infoscope and RCubed:
- Total K2fly SaaS ARR now stand at AUD 1,834,250, a 247% compound annual growth rate (CAGR).
- Total Contract Value (TCV) for SaaS contracts signed is now more than AUD 4.7 million, as more customers take up three- and five-year contracts, a CAGR of 793%.
- High level of interest from major mining houses and NYSE listed companies continues as US SEC regulation changes come into effect in 2021.
The Company expects this trend to continue with negotiations for further multi-year contracts in the pipeline. However, these potential contracts are still in negotiations and when complete, the Company will update the market in due course.
Read: K2fly Onboards 2 new RCubed Customers for Proof of Concept Design
Stock Information: K2fly’s market cap is ~ AUD 10.79 million with ~ 82.97 million shares outstanding. On 23 March 2020, the K2F stock settled the day’s trade at AUD 0.140, climbing up 7.698% by AUD 0.010 on a day when the benchmark index ASX 200 was down 5.6%.
