Gone are the days of meter checkers walking around your garden to record your power and water usage with the Internet-of-Things (IoT) now making rampant progress to automate such laborious jobs. As one of the world’s most advanced nations, it should come as no surprise that South Korea is leading the way with Aussie tech company X2M Connect (ASX: X2M) expanding their coverage of Okcheon County.
Having already been servicing part of the County, an extension of the existing contract will see X2M increase their coverage from 47% of households to 80% where meter tracking devices are connected via X2M’s IoT platform.
In total, 4,000 households within the municipality will now be connected remotely in a deal valued at $600,000 to X2M.
“This Okcheon contract again confirms the X2M view that once a municipality has made the decision to digitize its water and placed initial contracts, it is likely that additional contracts will follow to complete the digitization of all the municipality households,” said X2M CEO, Mohan Jesudason.
While the contract expansion is a handy win for X2M, the number of households with water monitoring devices connected is just a tiny fraction of the addressable market where there are approximately 3.5 million households in South Korea.
Other opportunities emerging in the IoT sector include gas and electricity meters for households which X2M offers in other regions as part of their network that has more than 220,000 devices connected to their platform.
As a densely populated region with high internet connectivity, Asia-Pacific is the focus of X2M’s marketing initiatives where the Company has operations on the ground in Japan, South Korea, Taiwan and China.
The Okcheon County contract win comes just days after X2M announced other contract wins in China and South Korea valued at $2 million combined to deploy 22,000 water meters with valve control into the Qingyuan district of Baoding City and 7,777 households in Incheon City.
For the half year ended 31 December 2021, X2M Connect reported $4.6m in revenue which represented a 44% increase from the previous corresponding period. The Company incurred a net loss of $6.5m however, which accounts for one-off expenses linked to their IPO in September 2021 when raising $8 million at an Offer Price of $0.25 per share.
As of 31 March 2022, X2M Connect had a cash balance of $2.2 million.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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