The Archtis Ltd (ASX: AR9) share price is climbing higher today after a contract renewal with the Australian Department of Defence.
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The Archtis Ltd (ASX: AR9) share price is climbing today after the software security provider announced a contract renewal with the Australian Department of Defence.
At the time of writing, the archTIS share price is edging 0.6% higher to 30.7 cents.
What’s pushing the archTIS share price higher?
According to this morning’s release, the Australian Department of Defence has renewed its annual software subscription licence with archTIS’ subsidiary, Nucleus Cyber.
archTIS completed the acquisition of Nucleus Cyber in December last year for $9.75 million.
Under the deal, Nucleus Cyber will continue to provide its NC Protect product to the Defence Department. The contract value for the year-long licence is $148,866.
The NC Protect is a cybersecurity tool that allows sensitive data spread across on-premises and cloud-based platforms to be secured. In essence, it protects against breaches, data misuse and unauthorised file access enabling companies to operate without outside intrusions. This enables safe file sharing, messaging, and chat across programs such as Microsoft Office 365—SharePoint, OneDrive, Exchange and others.
With the latest contract renewal wrapped up, archTIS highlighted that this was its second licencing award from the Defence Department this year. The first, signed in September, was a $4.2 million risk reduction activity aimed at informing defence on future capability decisions and acquisitions. Spread over 3 annual licences, each value of the enterprise platform came to $760,000 per year.
In total, archTIS’ group recurring annual subscription revenue stands above $950,000 from the Defence Department.
The company noted that its recent success follows the Australian Government’s 10-year defence budget. A detailed plan that will seek to invest $15 billion on defence information management and cybersecurity.
What did management say?
archTIS managing director Daniel Lai, welcomed the renewed partnership, saying:
This renewal demonstrates the strategic value of the Nucleus Cyber acquisition. It provides our customers with a range of policy enforcement products to secure and share their information assets.
The merger now means archTIS can provide award-winning products to secure our clients Microsoft business applications. The Defence renewal validates the quality and uniqueness of NC Protect. This renewal and our recent Kojensi sales strongly position archTIS as a key provider of information security products to the Australian Department of Defence.
This is an exciting time for archTIS as it continues to successfully execute our strategy to become the global leader of policy enforcement in the protection and sharing of sensitive and classified information.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.