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Summary
- Owing to a surge in the cybercrimes and frauds, cybersecurity players such as WhiteHawk have strengthened and expanded at an accelerated pace, backed by customers’ reliability on its cybersecurity exchange platform.
- On 28 July 2020, WHK witnessed a whopping increase of 213 per cent in its share price. The soared share price was buoyed by the notification that WHK has been contracted for five years by a U.S. Federal Government Chief Information Security Officer (CISO) to implement Cyber Risk Radar.
- The annual Software as a Service (SaaS) contract would witness WhiteHawk generating revenue of US$580k per annum and an additional US$600k per annum in services each year, for up to five total years.
While all eyes are fixated upon coronavirus crisis, cyber attackers are using this turmoil as a ploy to target multiple organisations, posing a threat to their existence.
As per Scamwatch, a website run by Australian Competition and Consumer Commission, had obtained above 3,400 scam reports (as of June 2020) that have resulted in beyond AU$1,790k in reported losses since the outbreak of pandemic.
Interesting Read: Optimism around Economic Outlook; Cyber-attacks target Australian firms
With an increase in criminal cyber activity, individuals, businesses, and governments across the globe have been implementing numerous preventive measures primarily to protect their IT systems against the unprecedented malicious cyber-attackm and boost their cybersecurity regimes.
Also read: Australia On Tightening Its Cyber-Regulation: Glance at AR9 and TNT
With this backdrop, let us appraise ourselves with one of the cybersecurity players that has stepped up to the plate and is knocking hard.
WhiteHawk Limited (ASX:WHK) is a global cloud-based cybersecurity exchange platform that enables businesses to take smart action against cyber-crime and fraud.
The Company furnishes virtual consultations; AI Cyber Risk Profile instantly match customers demand to customise solutions.
WHK shares surged up by 70.213 per cent on 28 July 2020, following the release of an announcement stating that WhiteHawk has been contracted by U.S. federal government CISO (Chief Information Security Officer) to apply WHK’s Cyber Risk Radar.
First, let us familiarise with the Cyber Risk Radar service of WHK.
Well, it is an annual SaaS subscription service created by the Company comprising of quarterly services that include:
- Cyber Risk Scorecards;
- Cyber Risk Portfolio Reports; and
- Ongoing conversations with a professional Cyber Analyst.
Furthermore, the SaaS service is provided for Risk research and discovery, continuous monitoring, alerts, analytics, risk prioritisation and mitigation, etc.
Let us now quickly gaze through the announcement acknowledged as “WhiteHawk Wins Five Year U.S. Government Cyber Risk Radar Contract”.
The five-year contract would provide continuous supervising, prioritisation, and near real-time mitigation of an enterprise’s vendors, teammates, or supply chain’s cyber risks over time, encompassing the identification and prioritisation of a risk mitigation strategy.
The annual Software as a Service (SaaS) contract is believed to generate base revenues worth US$580k per annum for WhiteHawk over the first year of the contract, with four additional option years, worth a further US$600k per annum in services each year, for five years in totality.
WHK’s Cyber Risk Scorecards would be furnished quarterly, virtually, and remotely, for 150 to 300 vendors to the US CISO, through an integrated risk management dashboard.
Notably, this is the first U.S. Federal contract where WHK has been chosen as the Prime Contractor. For the previous three U.S. federal Department CIO Contracts, the Company had been a Cyber Solution sub-contractor to SAIC, Accenture Federal and Guidehouse (earlier known as PWC Federal).
Source: ASX announcement
Did you read; Cyber Espionage Campaign: Strings that tie China, Australia and the US
A sneak-peek at other key activities of the Company:
Working capital facility update
On 1 July 2020, the Company revealed about a working capital facility of AU$1 million on the implementation of the Share Purchase Agreement and Equity Swap Agreement (‘Working Capital Facility’) with RiverFort Global Opportunities PPC Ltd.
The raised funds would be utilised for working capital to enlarge sales channels, and to implement Proofs of Value throughout active contract leads of 5 product lines.
It is worth noting that WhiteHawk possesses a strong cash position, with a balance of ~ AU$2.4 million, as on 31 March 2020. Furthermore, the Company is well-funded into FY2021, with existing contracts and a robust pipeline of opportunities through operating revenue streams.
Did you read; Opportunities and Challenges for Cybersecurity: Glance at TNT, VOR, WHK and FZO
Outlook for 2020
Owing to the dramatic surge in the cybercrime and fraud amid COVID-19. The Company plans to double down on more economically resilient sectors of the US Federal Government and the US Defense Industrial Base for the year ahead.
Stock performance
On 28 July 2020, WHK closed the day’s trade at AU$0.16, indicating an upsurge of 70.213 per cent from its last close. The Company has a market capitalisation of AU$16.17 million and total outstanding shares of ~ 171.98 million.
WHK’s 52-week low and high was noted at AU$0.025 and AU$0.160, respectively. The Company has generated a total return of 77.36 per cent, and 18.99 per cent in three months and six months, respectively.
