High-speed welding technology company K-TIG (ASX: KTG) has unveiled a record March quarter (Q3 FY2022) that generated sales of $1.159 million and a 329% growth in cash receipts.
The $1.159 million sales revenue figure was a 10% increase on the December quarter (Q2 FY2022) and a 148% rise on the previous corresponding period.
K-TIG attributed the increase to direct sales, as well as its distributors actively selling K-TIG systems.
Q3 FY2022 cash receipts were also up – growing 329% to $931,000 for the period compared to Q3 FY2021.
Contributing to the company’s financial performance was the achievement of a “number of strategically important milestones”.
During Q3 FY2022, K-TIG inked a formal agreement with UK-based Nuclear Advanced Manufacturing Centre (Nuclear AMRC) to develop a turnkey robotic welding cell for use in production of nuclear storage containers that can each hold 3 cubic metres of intermediate waste.
The agreement paves with way for K-TIG and Nuclear AMRC to develop “a world leading” welding cell within a Nuclear Industry Technology Demonstration Facility to optimise the Sellafield Tranche 2 ILW container design and steady state manufacturing process.
Via this collaboration, K-TIG is actively working on becoming a supplier to Sellafield for the first 2,000 units required for its decommission.
It is expected up to 17,000 containers will be needed to hold intermediate level waste during decommissioning of the Sellafield nuclear site near Cumbria as part of the UK’s $2.84 billion procurement plan that is due to kick-off in FY2023-2024.
K-TIG will own all the intellectual property created in the collaboration – paving the way for it to commercialise ILW welding cells.
Due to be delivered in three phases by December 2023, the project is harnessing the latest automation technology, sensor integration, statistical process control, QC, QA and welding procedure automation.
K-TIG says the project will ultimately develop a turnkey robotic welding solution for a global issue.
“The intention is for it to be adaptable to service the decommissioning of nuclear power sites around the world,” K-TIG noted.
The International Energy Agency estimates around 200 commercial nuclear reactors will be shut down between 2020 and 2040 – with facilities worldwide aging and two-thirds more than 30 years’ old ore more.
“Storing nuclear waste requires containers, which must maintain integrity for a minimum of 150 years,” K-TIG explained.
“K-TIG technology will provide that through consistently repeatable high-quality welds and integration of cutting-edge real-time quality inspection capability, such as ultrasonic and acoustic sensors.”
Another major milestone for K-TIG during Q3 FY2022 was an agreement to build a research and development facility within BAE Systems Australia’s Factory of the Future at South Australia’s Tonsley Innovation District.
The facility will assist K-TIG in demonstrating and further evolving its robotic welding capabilities for ship building and other applications.
As part of this, K-TIG is actively working with global majors on assisting them in delivering Australia’s next generation of maritime capability to provide pipe spooling, deck plate, and light weight structure solutions to “dramatically lower” fabrication costs.
Research and development
Critical to K-TIG’s growth strategy is ongoing research and development activities.
During Q3, the company continued to make “good progress” with its Evolve 3 product – achieving major software milestones of a stable prototype human machine interface.
In the June quarter, K-TIG expects to begin weld testing using this software. Additionally, the company will begin enhanced hardware design for the controller. This will enable further functionality and third-party welding actuators and sensors to be integrated into the K-Tig offering, while reducing manufacturing costs and boosting product reliability.
Corporate and cash on hand
Former Bapcor chief executive officer Darryl Abotomey joined K-TIG’s board in March in non-executive capacity to assist the company in its growth plans.
At the end of Q3 FY2022, K-TIG had $4.88 million in the bank after raising $ 4 million in February.
It also closed the period out with 214 deals in the pipeline, which is a 206% on the previous corresponding period.