IT business, Skyfii, has won and renewed some major contracts in recent weeks, which TMT Analytics believes reinforce the potential of the company.<\/p>\n
-Substantial opportunities to on-sell further I\/O services By Eva Brocklehurst<\/p>\n Skyfii ((SKF)), an Australian-based technology business, has scored a significant contract from a major global shopping centre group. This contract is estimated to be worth more than $750,000 and the Skyfii I\/O SaaS platform will be rolled out across 22 centres, initially in Europe and the US.<\/p>\n The company has not disclosed financial details, other than the initial contract value being more than three times the purchase price of Wicom Wireless, which was around $247,000 and paid in scrip.<\/p>\n The new customer was a client of Wicom Wireless, recently acquired by Skyfii, and the Skyfii I\/O platform has been on-sold to this customer. This includes I\/O Connect, the data portal where data is collected in the venue with Wi-Fi capability, and I\/O Insight, where venue performance is measured through data analytics based on visitors. Additionally, data consultancy services (DCS) will be provided, including project-based analytics around venue and visitor data.<\/p>\n The value of the initial service is worth a minimum of $250,000 year and TMT Analytics expects the annual deal can be substantially higher. DCS are one-of projects which can be worth anywhere between $10,000 and $250,000 per project.<\/p>\n The analysts also expect further opportunities to emerge through the rolling out of I\/O Engage, the company's digital marketing services for retail venues that are powered by the actual visitor and Wi-Fi data generated at these venues.<\/p>\n Assuming DCS accounts for 10% of revenue in this deal, TMT Analytics estimates monthly recurring revenue per venue of around $815, or around $18,000 per month across the 22 malls.<\/p>\n The company, in the September quarter, indicated recurring revenues grew by 55% while non-recurring revenue grew by 11%. TMT analytics is encouraged by the growth trend which illustrates the scalability of the company's business model.<\/strong><\/p>\n In the current quarter, the early indications are for 35% growth in recurring revenue. On this basis the analysts calculate recurring revenues would amount to $860,000. They do point out that non-recurring revenue in the first quarter was down -44% versus the prior quarter, which emphasises the bulky nature of consultancy services.<\/p>\n TMT Analytics reiterates a Buy rating and 14c price target.<\/p>\n But wait, there's more. In September the company achieved a contract with Lexicon Shopping Centre in the UK for the provision of the three I\/O services: I\/O Connect, I\/O Insight and I\/O Engage. This marks the first deal in the UK shopping centre vertical, and TMT analysts notes the company is already active in the UK education vertical through a deal with Durham University as well as in quick serve retail through a deal with a UK food chain.<\/p>\n Skyfii has also secured its first deal in the grocery retail vertical with one of Italy's largest supermarket chains and will provide I\/O Connect and I\/O Insight across 285 supermarkets in a five-year contract. The company's platform will replace an incumbent analytics solution.<\/p>\n Other contracts recently renewed include GPT ((GPT)), for three more years. GPT was one of the company's first customers in 2015 and now sources all three I\/O services from Skyfii. A contract has been secured with Aventus Property ((AVN)), a specialised property fund manager with 22 large format retail centres in Australia. Four sites will initially be connected and there is potential to expand to some of the others.
\n-New contract with UK shopping centre chain
\n-First deal in a grocery retail vertical, in Italy<\/strong>
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