In a big show of confidence towards resources tech company K2fly (ASX: K2F), global mining company Fortescue Metals Group (ASX: FMG) has extended their engagement by 3-years which includes plans to streamline operations onto K2fly software.
The contract extension is valued at $1.45 million over the three years and will take the partnership into its 12th year. Additionally, Fortescue will commence rolling out K2fly’s Infoscope Land Management software across sites in Europe and South America.
“We are delighted to continue our long-standing partnership with FMG which commenced in 2012,” said K2fly CEO, Brian Miller.
“The FMG approach in looking at this as an integrated solution across heritage, environment, tenements, land use permits, and social investment rather than in silos is world’s best practice. We are excited about where we can take this with FMG and other customers.”
Currently used by Fortescue across its Pilbara operations in Western Australia, the adoption of Infoscope extends the geographical footprint of K2fly which already services clients in the mining, oil & gas, utilities and agriculture sectors around the world on recurring licensing contracts.
Environmental, Social, and Corporate Governance (ESG) continues to be a growing area of attention for resource companies where Infoscope assists companies maintain their ‘social licence’. This covers management relating to land access, compliance, cultural heritage, native title & environmental management.
With top resource companies placing greater emphasis on these social responsibilities, K2fly’s software solutions are now employed at more than 500 sites, across 54 countries.
As surveyed by Ernst & Young in 2020, Social License to Operate was deemed as the top risk by mining company CEOs for the second consecutive year. The future of their workforce came in at number 2, digital and data optimisation at 3 and carbon footprint at 4.
This has been reflected in growing adoption of K2fly’s software with the tech company recently reporting $2.06m in invoicing for the quarter ended 31 March 2021. The result represented a 27% increase on the previous corresponding period.
Beyond Fortescue, other clients serviced by K2fly software include resource giants Rio Tinto, Glencore, Vale, Newcrest, Newmont and Kinross.
With no debt, K2fly is verging on profitability, however expenses have recently been increased due to one-off costs tied to their recent acquisition of Decipher, a tech company specialising in tailings and rehabilitation.
CSBP Ltd, a subsidiary of Wesfarmers, recently increased its stake in K2fly beyond 10%.
*Owners of this website are K2F shareholders