K2Fly secures $1.2 million mining tech deal with iron ore giant Fortescue

In another contract win for resource governance company K2Fly (ASX: K2F), the Company has been given the software development services order by Fortescue Metals Group (ASX: FMG). The contract is worth $1.2 million for an expected period of six months.

The Company has received orders from entities related to or associated with Fortescue. It will be providing software development services on a time and materials basis. 

K2Fly is the leading provider of Resource Governance solutions for ‘net positive impact’ in Environmental, Social and Governance (ESG) compliance, disclosure, and technical assurance. The Company focuses on the operations of mining and asset intensive industries through platform-based SaaS cloud solutions. 

CEO of K2fly Nic Pollock commented, “We are pleased to be working with Fortescue across a number of areas in the business. Fortescue are using a number of our platform solutions and in addition, have engaged us for software development services in other areas of their business.”

He added that these services are additional one-off revenues for K2fly and are also generated from time to time with other K2fly clients.

Through acquisition, development, and partnerships, K2fly have curated a unique platform that generates high margin SaaS recurring revenues. The Company boasts a global presence and allows companies to move between two mining codes, New NYSE (SK-1300) and ASX (JORC) code, seamlessly. It helps companies meet ESG Reporting requirements.

The Company’s strategy is to ‘land and expand’ its offerings. Though this might sound very Julius Caesar (read: veni, vidi, vici), it appears to be working for K2Fly. The Company also rolls out additional solutions to support central operational management and efficiency gains.

To ensure that, K2fly works closely with peak industry bodies, regulators, and its industry advisory groups on ESG topics. Because regulations are rapidly changing, owing to dynamic community and investor expectations, the group helps build solutions relevant to the industry. 

In June, three major contracts were signed with K2Fly, including BHP Iron Ore, valued at $2.12 million and an annual recurring revenue (ARR) of $620k. The second contract was a purchase order with Rio Tinto, worth $423k and finally, the third one was a three-year contract with Asarco (subsidiary of Grupo Mexico), valued at $468k and ARR $145k.

In FY22, the annual average size of new license contracts signed by K2Fly has grown five times to $347k, compared to the previous year of 71k, and years before that.

In December 2022, K2fly plans on releasing a new Resource Governance Platform, which is based on the global success of its RCubed Mineral Resource and Reserve Reporting Governance solution. It might also encourage more companies, like Fortescue, to bring on K2Fly.