There are few ASX listings of recent memory which have entered the market with an established niche on the level of that enjoyed by Aquirian Group.

A mining services company, Aquirian’s (ASX:AQN) listing tomorrow will come on the back of a successful oversubscribed $8 million IPO joint lead managed by JP Equity Partners and Pursuit Capital which gives it a post-listing market capitalisation of $16 million and an enterprise value of $10.77 million.

While it may be the latest of a flurry of mining services companies to publicly list, Aquirian’s unique place in the market leaves it with a vast number of quality partners and very few true competitors.

Unlike most around it, the company is not a contractor. It works with both mining contractors and tier-one miners – a unique attribute in a competitive space, allowed by a suite of business offerings and some innovative tech to boot.

Aquirian’s business is split into two main divisions – mining services and people services – each of which account for about 50% of generated revenue ($11 million in FY20).

People services includes workforce resourcing and staff training arms for the mining industry, while mining services supplies both consumable products and storage solutions to miners and their contractors.

Managing director Dave Kelly told Stockhead the offering mix meant the company was balanced in terms of both the clients on its books and a steady flow of work.

“We see Aquirian as a diversified, profitable mining services business with blue-chip clients,” he said.

“On any given day we deal with probably 40-50 mining houses or contractors, and our largest customer currently makes up about 8-9% of revenue, so we’re not beholden to a single source of revenue which could drop off at any time.”

Blue-chip is one way of putting it. Independent by way of its non-contractor status, Aquirian’s client base reads like the Australian mining industry equivalent of a Coachella setlist.

That’s a decent line-up. Pic: Supplied.

The books are not just balanced in terms of clientele.

“It’s pretty well known that trying to find human resources in Western Australia is a struggle for most miners at the moment, and that’s the same for our people business,” Kelly said.

“But while that might drop away a little bit because of the battle to find labour, we’re finding our training and equipment businesses are really picking up, because people are desperate for gear and need to find trained people.

“We’ve achieved a nice balance for our shareholders across the portfolio.”

Kelly also highlighted the ability to cross-pollinate between its business divisions – a method which has allowed the company to grow substantially since its founding in 2017 and one sure to appeal to prospective investors as it lists in 2021.

Blue skies ahead

Perhaps the most exciting point of difference for Aquirian is its product technology arm, which has already produced and commercialised an innovative blast quality product known as CollarKeeper which is sold in 12 countries around the world.

“CollarKeeper stabilises blast holes from the completion of drilling through to loading explosives, which is a major concern for our clients,” Kelly said.

“To date we’ve sold about $6.5 million worth of the product around the world, and we’ve continued to gain new customers on a monthly basis along the way.”

Around 30% of the money raised from the IPO will go into the further development and commercialisation of the technology, which is expected to pave a path to automation which doesn’t currently exist.

“The next stage of the technology is to expand it into a system, which starts protecting blast holes from the moment the drill engages with the ground,” Kelly said.

“That’s exciting for us, and it’s exciting for the industry – it fixes a problem that’s a large issue in WA, particularly in the smaller gold, nickel and lithium mines where you see a lot of blast hole collapse.

“As our chairman Bruce McFadzean says, the issue we’re trying to address hasn’t been looked at in 40 years of mining, so if we can solve it, it could be game-changing for our clients and for the industry.”

The same amount is expected to be put towards underground fleet expansion, with $500,000 to expanding the manufacturing capability and capacity of the MagLok business, which supplies storage solutions for explosive materials and dangerous goods.

“The people side of the business is profitable, and it will be allowed to grow organically, but we are really focused on our technology in terms of equipment and products,” Kelly said.

“That’s where we see the real blue sky, in terms of newflow with the tech and the growth of our fleet – we can’t get into gear quick enough at the moment.”