Environment, social and governance (ESG) software company K2fly has confirmed December half-year revenues of A$4.5 million, 34% higher than the year before period, and a net loss of $1.7m on the back of 55% higher cost of sales.
K2fly previously advised the market of its H1 annual recurring revenue of $4.8m and total contract value of $16.6m at the end of December.
“In response to recent growth, including through acquisition, and to establish a stable foundation for expected future growth, during H1 FY22 the group invested in staff to meet the contracted and expected demand for new projects, expansion of existing projects, and in its management function,” K2fly said.
“As a result of these sales and investments, the K2fly reported cost of sales of $2.5m, 55% higher than the H1 FY21 cost of $1.6m. Employee benefits expense H1FY22, which included $0.3m of recruitment costs, increased to $2.7m (H1 FY21 $1.5m) and consultancy expenses increased to $0.4m ($0.2m).
“These costs of labour and project resourcing, and talent sourcing, has been impacted by global labour market constraints, as well as the need to recruit and train staff in advance of project commencement.”
Significant new sales reported in the first half of FY22 included five-year deals with Alcoa USA Corp, Newmont Corporation, Sibanye Stillwater and Rio Tinto, and a three-year extension with Glencore Canada Corporation.
K2fly had cash of $3.6m at the end of 2021, compared with $6.9m in mid-2021.
Its shares (ASX: K2F) are down about 33% year-to-date at 20c, capitalising the company at $27.6m.
