Trakopolis announced this afternoon that that it has received a significant purchase order from a major U.S. based energy company for 1,500 units of its co-created product the Honeywell ConneXt Lone Worker gas detector.
Trakopolis’ industry leading software will deliver this solution as “software as a service” and thus each unit will carry a monthly recurring data fee for the contracted four-year period. The minimum total contract value is expected to be USD$4.79 Million, with an estimated USD$2.82 Million (inclusive of hardware revenue) expected in fiscal 2017.
With this announcement investors can now start to model what capturing even a small percentage of the gas detector market would mean to TRAK. Fifteen hundred units represents only 1% of the North American market and just last week, TRAK and Honeywell announced that they are expanding their sales efforts worldwide. See news release here.
When asked, management acknowledged that this sale came with some first customer discounts and made clear that there is a significant pipeline building for the company. This is understandable considering Honeywell is the largest manufacturer and supplier of industrial gas detectors in the world.
The revenue impact of this deal provides clear visibility into the achievement of TRAK management’s stated revenue milestones, which according to the company’s corporate presentation is a $10 million run rate by Q4 2017.
Of note, the “large US-based oil and gas company” that made this initial order reserved an option to order an additional 1,000 units, on the same terms, during the first 18 months of the term.
To view the full news release, please click here.