Traffic Technologies bags $9m deal from QLD government, secures long term revenue in the state
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Traffic Technologies is expanding rapidly, and the $9m contract win today follows closely on the heels of another contract won last week worth $5.7m.
Provider of end-to-end traffic management, IoT and Smart City solutions, Traffic Technologies LTD (ASX:TTI), has secured long-term recurring revenue in Queensland after being awarded contracts worth $9m.
The contracts were awarded by the Queensland Department of Transport and Main Roads (TMR), for the supply of a wide range of traffic management solutions including hardware and associated software across the state.
The five-year contract also contains two options for further three-year extensions, which means that it could potentially expire as far out as 2032.
“The term contracts are significant as they provide an important source of long-term recurring revenue, and secure the group’s position in the Queensland market,” says Traffic Technologies CEO, Con Liosatos.
The Queensland TMR is the state road authority for Queensland outside of Brisbane. It’s responsible for planning, managing and delivering Queensland’s integrated transport infrastructure.
“TTI has been able to significantly strengthen its position in the Queensland market, following the acquisition of the iTS business acquired in June 2021,” Liosatos said.
Earlier this year, TTI acquired Brisbane-based iTS (Intelligent Transport Systems), a business focused on the design and manufacture of electronic road signage and software systems.
The iTS technology effectively enables motorists to make informed decisions ahead of time in a timely manner, enabling smoother traffic flows on the road network.
Last week, that acquisition proved its worth in enhancing TTI’s position in the intelligent transport sector by winning a $5.7m deal from Coates, an Australian-based traffic control equipment rental company.
Traffic Technologies is Australia’s premier traffic control systems provider, supplying smart city-enabled IoT devices to help councils, road authorities and power companies, better manage their assets.
The company is positioning itself in the rapidly expanding global IoT market, which is said to be worth US$1.7 trillion and forecast to grow to US$12.6 trillion by 2030.
Its state-of-the-art lighting, signage and traffic management hardware have been approved for use by every Australian council,, and already implemented in more than 31,000 intersections worldwide.
TTI is a pioneer in the field, having designed innovative traffic solutions for over a decade, well before most councils and roads authorities fully understood the value of these smart systems.
The company is currently in a very strong financial position, with revenues growing to $52.3 million in the past year.
To further strengthen the balance sheet, TTI announced earlier this month a capital raise of more than $10m in a bid to reduce debt and execute its growth and acquisition strategy.
The $10.3m rights issue is expected to reduce debt by more than 60%, and interest costs by 70% or $1.6m.
TTI says it will also continue to leverage its comprehensive proven technology by continuing the acquisition strategy, as well as expanding the commercialisation of its SaaS platform.
Join Traffic Technologies (ASX: TTI) managing director Con Liosatos for an investor briefing on Friday, 26th November at 1pm (AEDT). Book your spot here.
This article was developed in collaboration with Traffic Technologies, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.