The IkeGPS Group Ltd (ASX: IKE) share price is shooting higher today after a positive contract announcement.
At the time of writing, the IKE share price is up 4.6%, trading at 90 cents apiece.
IKE collects and analyses pole and overhead asset data for utilities and engineering firms. Below we take a look at the company's latest news.
What did IKE report this morning?
The IKE share price is lifting after the company reported it had extended an agreement with a Fortune 100 United States electric utility. IKE is working with the company to assess and design its infrastructure.
The contract extension will boost IKE's transaction revenue in the 2022 financial year (the period ending 31 March 2022) by $1.2 million. On the newly extended agreement, the utility customer's contract value has increased more than 4-fold since the initial contract was signed in October 2020.
IKE reported the utility would make use of its platform to evaluate some 350,000 power pole assets. The contract goes into effect immediately.
What did management say?
IKE CEO Glenn Milnes welcomed the contract extension, saying:
The expansion of this existing customer contract demonstrates the value that the IKE platform provides to large electric utilities, and confirms our ability to expand the use of our platform over time across targeted tier-1 infrastructure operators…
We are also pleased with the broader strength of new contract wins over the quarter to 31 March, of approximately $5.4 million, and now with contract wins in the initial weeks of Q1 FY22, of approximately $2.2 million. This provides real momentum for growth for our FY22 to March 2022.
Atop the contract extension announced today, IKE added that it closed record contracts in Q4 (ending 31 March) for approximately $5.4 million. The company will record most of that revenue in the 2022 financial year.
IKE's full-year revenue for the 2021 financial year came in at roughly $9.3 million. That figure, still subject to audit, is in line with market expectations.
IKE share price snapshot
Over the past 12 months, IKE shares have outperformed, up 53% compared to the 34% gain on the All Ordinaries Index (ASX: XAO).
Year-to-date, the IKE share price has gone the other way and is down 17% so far in 2021.
