K2fly locks in mining giant for software contract
Small capped ASX-listed software technology innovator, K2fly, has inked a lucrative, $1.45 million, five-year contract with mining heavyweight, Rio Tinto, to immediately roll out its specialist “RCubed” mineral resource governance software across 20 Rio sites around the globe.
K2fly’s RCubed software is an innovative peice of mining industry technology that assists companies to manage the most valuable of their primary assets – their mineral resources and reserves.
The mining sector is facing greater scrutiny than ever before from both regulators and investors and K2fly’s RCubed software provides what the company describes as a “single version of truth”, for multiple generations of historical mineral resource iterations and operational data.
RCubed attempts to largely replace what has always been a very complex manual process, usually driven by a Geologist or Engineer, with an automated workflow of sorts. This de-risks the manual component of the process and also moderates the impost on the operator.
K2fly’s software automatically generates mineral resource and reserve reports that support reporting codes such as JORC, NI43101 and SAMREC that are usually required by the major stock exchanges including ASX, NYSE, LSE, TSX and JSE.
RCubed will also pick up any random changes in the regulations that companies report under and manage those throughout the software’s practical workflows.
In a nutshell, RCubed can pick up, store, watch, validate, audit, filter, manage signoffs and report resource and reserve data, all in the one place.
The small-capped company’s deal with Rio Tinto will no doubt underpin its credibility as a supplier to the biggest and best operators in the mining sector and potentially provide it with opportunities with the other majors.
K2fly is essentially a technology company with three principal business units including its wholly-owned software as a service, or “SaaS", solution, third party software sales and its management consulting arm.
K2fly's star studded client base across all its SaaS platforms include Newcrest, FMG, Glencore, Imerys, Westgold, Mineral Resources, Panoramic, API Management.
The Perth based company acquired the RCubed SaaS in May this year from South African company, Prodmark, for what now looks to be a steal at just $450,000. The acquisition came gift wrapped with a couple of blue-chip clients already on-board including Teck Resources, Anglo Gold Ashanti and Impala Platinum.
Before K2fly purchased RCubed, it already offered a package known as “Infoscope”, which the company markets as enterprise land management software.
Infoscope assists mining and resource companies to comply with complex regulatory reporting obligations.
Within a mining company, there are a whole range of disciplines that actively use land management data. These include tenement managers, environmentalists, heritage managers, accountants, business development staff, stakeholder managers, community and social managers and executives, to name just a few.
K2fly points to an Infoscope case study centred on one of its clients, FMG, to show that its single package had replaced more than eight individual systems and software packages with over 300 users’ loging into the system daily.
Mining types will be able to appreciate K2fly’s strategic alliances with global tech companies such as Esri and SAP – with these two platforms linking nicely with Infotech.
Corporate social responsibility and broader stakeholder demands have escalated exponentially in recent years, which has opened up a whole new market for tech management players like K2fly.
Infoscope and RCubed give resource companies the ability to manage rigid environmental, social and governance responsibilities that are quite commonplace in today's mining world, by delivering data management solutions and reports that underpin their social license to operate.
According to the US Sustainable Impact Foundation, $1 for every $4 a company invests is on environmental, social and governance, or “ESG” factors. Respected industry advisors, Ernst and Young say that a ‘license to operate’ tops the list of business risks faced by the mining and metals industry in 2020.
K2fly is in a unique position, poised to grow quickly with a phenomenal geographical spread of companies across 41 countries and 5 continents now adopting its software as a service.
Its new Rio contract will no doubt provide a further fillip for its strong annual recurring revenue growth which is already sitting at 150% year on year.
K2flys’s Chief Commercial Officer Nic Pollock, said: “The rapid growth in all things [environmental, social and governance] in resource companies needs to be adequately supported by standards-driven, auditable software solutions that can address current and future regulatory reporting and social license narrative.
Increasingly it will contribute towards any Resource company’s valuation, and its cost of capital.”…
…“Rio Tinto’s signing represents a significant milestone for K2fly and is further recognition from a Tier 1 miner that our RCubed solution represents the most compelling offering in resource governance solutions. We are extremely proud to be working with such an industry leader”.
Miller has been doing deals in the IT sector for some decades now and currently sits on a number of IT company boards in both Australia and the UK.
With a suite of majors already on its client list, it shouldn’t take long for K2fly to create a solid annuity stream from its software as a service business which will ultimately underpin its market value.
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