K2fly Ltd's (ASX:K2F) new contracts for its RCubed Software Solution have now passed the second contracted ‘net new annual revenue’ acquisition performance milestone.
With the recent with the signing of Newmont Corporation (NYSE:NEM) in March, RCubed annual recurring revenues (ARR) have reached A$1,017,352 in under nine months from the acquisition of the software in May 2019.
K2fly chief commercial officer Nic Pollock said: “In quarter three FY20 K2fly has achieved further validation for its RCubed SaaS solution including new contracts with Gold Fields Limited (JSE:GFI) Australia, Newmont as well as a 3-year extension by AngloGold Ashanti Limited (NYSE:AU) and contracts for proof of concepts designs with South32 Ltd (ASX:S32) and Vale SA (NYSE:VALE).
“The most recent signing of new contracts for the RCubed Software Solution combined to exceed the contracted first and second year ‘net new annual revenue’ acquisition performance milestones, which is significantly ahead of schedule.”
Additional contracted implementation revenue is a minimum of A$1,031,600.
Pollock said: “Despite recent global headwinds, demand and interest in the RCubed Software Solution has not waned, as it is regulatory-driven, and companies still have ongoing reporting obligations for their mineral resources and ore reserves.
“Importantly, our implementations require little to no time on site and can be adapted to be fully implemented remotely, accommodating the current world circumstances.
“Furthermore, 75% of our contracts for RCubed are in US dollars, which is highly beneficial with the depreciating AUD, and given most of our costs are in AUD and ZAR (South African rand).”
This trend is expected to continue with negotiations for further multi-year contracts in the pipeline.
Annual growth increases
The year one new ARR acquisition performance milestone of A$500,000 was surpassed in November 2019, with the signing of Rio Tinto Limited (ASX:RIO) and Nexa Resources SA (NYSE:NEXA).
The total of the company’s SaaS ARR now stands at A$1,834,250, which is a 247% compound annual growth rate (CAGR).
The total contract value (TCV) for SaaS contracts signed is now greater than A$4.7 million as more customers take up three- and five-year contracts - which represents a CAGR of 793%.
K2fly expects a high level of interest to continue from NYSE listed companies due to US Securities and Exchange Commission regulation changes which come into effect in January 2021.