K2fly has tabled some healthy numbers from the March quarter with record invoices of $3.3m, maintaining its all-time high total contract values of $16.6m and cracking the $5m mark in annual recurring revenue for the first time. The company operates in the global resources space under a ‘Software as a Service’ business model – meaning it delivers its software on a subscription basis.
Mining software company K2fly has tabled some healthy numbers from the March quarter with record invoices of $3.3m maintaining its all-time high total contract values of $16.6m and cracking the $5m mark of annual recurring revenue for the first time. The company operates in the global resources space under a ‘Software as a Service’ business model – meaning its software is delivered on a subscription basis.
K2fly’s quarterly invoices of $3.3m were up 33.5 per cent from the previous quarter and up 60.2 per cent compared to the $2.1m invoiced in the same quarter a year ago.
The remaining value of K2fly’s current contracts or total contract value remained at $16.6m for the quarter.
The achievement is significant as total contract value decreases monthly as the remaining term of the contracts reduce.
The figure remained at an all-time high due to the signing of two major contracts with South32 and Freeport-McMoRan during the quarter.
The three-year contract signed with South32 for K2fly’s ‘Decipher’ product rakes in a total contract value of $781,000 and annual recurring revenue of $180,000.
The other three-year contract signed with Freeport-McMoRan for K2fly’s ‘RCubed’ product nets a total contract value of $768,000 and annual recurring revenue of $200,000 for the company.
Decipher is a dams and tailings solution, whereas RCubed is centred around mineral resources and reserves.
Notably, the current quarter’s total contract value of $16.6m was 81.4 per cent higher than the $9.1m tabled in the same quarter a year ago.
Annual recurring revenue of $5.2m grew 8.3 per cent compared to the prior quarter and impressively was up 78.9 per cent compared to the same time a year ago.
Cash receipts from customers during the quarter were $1.8m, up 23.5 per cent compared to the same quarter a year ago. According to management, compared to the prior quarter, cash receipts were down 34 per cent due to the timing of billings and payment terms.
It notes that with $3.2m in trade receivables, it is anticipated the cash will flow into next quarter’s receipts.
K2fly Chief Executive Officer, Nic Pollock said: “Q3 was another quarter where operational and strategic milestones were achieved. We invoiced more than $3m ($3.3m) for the quarter and we drove past $5m in ARR ($5.2m). We landed a prestigious new client in Freeport-McMoRan, and we successfully expanded the use of our Tailings solution in South32 to all of their operations globally.”
Across the quarter, the company also completed a capital raising of $6.2m and welcomed private software company Maptek onboard as a strategic investor.
K2fly’s cash balance at the close of the quarter was $1.5m – with no debt.
Operating expenditure was $1.4m and gross expenditure was $3.1m. The company notes its expenditure decreased by $800,000 compared to the previous quarter due to the one-off nature of some costs and the timing of other financial commitments.
Software as a service businesses have come into vogue in the past couple of years as punters look to get a piece of what is essentially an annuity style revenue stream.
Notably, K2fly holds a page-long roster of rolled gold clients across all continents and in 54 countries. Notable ‘A-listers’ under agreements with the business include Fortescue Metals Group, South32, Rio Tinto, Roy Hill Holdings, Mineral Resources, Newmont Corporation, Newcrest Mining, AngloGold Ashanti, Goldfields, Westgold Resources and Glencore.
The mining tech company provides an encompassing range of software from traditional mining items such as resource inventory calculation to tools that facilitate meeting the increasingly important environmental, social and governance criteria.
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