Within 12 months the group has on boarded and now servicing two Tier 1 miners, which is a substantial achievement. RKT is embedding themselves in the day to day operations of these businesses, which opens the door for further service work and contract wins.
The BARS accreditation the company has received is the Gold standard and is a 3 yr process - where a full audit took place and found no adverse findings. This is a huge positive for the business, which gets RKT in the door to engage and deliver with the Tier 1 clients, both from the public and private sector.
The new remote operating centre (ROC) now up and running in Perth is a great asset for the business that will be used with prospective clients to showcase the group's capabilities. It enables the business to scale efficiently and reduce the cost to service clients.
Anglo contract update - The loss of this contract as announced was as a result from the divestment of the project by Anglo. The group is actively engaged with the new owners of the mine, with a view to undertake a trial of the new drone / tech / services the group is offering. Post the completion of this the group is confident in getting back on site for the longer term. The business does not believe the opportunity to reinstate a contract for this site is lost and is actively working to see this materialise.
Rio Tinto - 3 month trial has transferred now into a longer term relationship. Rio has been very particular with how they want to utilise the RKT product and services. They are now engaged with a number of the other divisions and operations globally with the business, which they expect to see further uptake with. Rio have moved from a trial to a formal pilot (paid for), this goes from a pilot to demonstration phase that would see drones deployed to other sites in the region. Finally upon success, this would lead into 'scalability' with these clients that would see this product / services deployed to all mine sites - the major prize! The company is focused on managing the early stage of the relationship really well and has had to be considered with what they release to the market, knowing the prize is substantial where they could deliver 'hundreds of drones' to each Tier 1 client upon scale up phase.
The group is adamant the sales pipeline will materialise where a customer order moves from 1, to then 3-5 and then up to 20+ drones at a time. A number of material contracts are being worked / actively in the pipeline of this magnitude. The two drones listed in the quarterly were deployed to the Tier 1 customers.
WAPOL - RKT was selected as a supplier to service the WA Police for a 3 year period. One unit has been deployed with the Police to date, with use cases and work streams increasing. One of their key members of the RKT team is ex police who has a deep technical understanding and will be key to opening up this relationship. The company also sees a substantial opportunity to deliver these services into the US police departments, where the Drone as a First responder is widely accepted. It sounds as though they have discussions active in this space.
On going work in the public safety space, off the back of the work with WAPol. Other Gov departments are actively engaged and assessing the opportunity. Company will be looking to formalise this work.
Looking to deliver some good news re converting current 1-3 year contracts to 5 years+
RKT Price at posting:
1.0¢ Sentiment: Buy Disclosure: Held
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