Minnowtech Contract and Trading Update
25 November 2021
OTAQ plc (LSE: OTAQ), the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, announces a new and exclusive multi-year contract to supply Minnowtech LLC ("Minnowtech") with its sonar technology, following the completion of successful trials. The Board also provides a pre-close trading update ahead of the Company's interim results for the six month period to 30 September 2021, which are expected to be released next month.
Minnowtech, which provides a non-invasive technology for managing shrimp farming around the world, has jointly developed with OTAQ a proprietary shrimp biomass solution for which OTAQ's sonar hardware is a vital component.
OTAQ has supplied units for testing purposes, with a value to date of over $50,000, which have performed in excess of expectations in real-world field tests, offering significantly better results than comparable sonar products when tested alongside the OTAQ sonar. Minnowtech is now preparing for commercial launch in Asia where an estimated 100,000 plus shrimp ponds are in operation and could benefit from Minnowtech's solution. The signing of the new contract begins with an initial order for over $200,000 of further sonars with an expectation of further orders from 2022.
Minnowtech benefitted from significant grant income from a US Government agency and equity financing in 2021 to fund its market entry in 2022. OTAQ holds a beneficial interest in approximately 15.2% of Minnowtech's ordinary share capital.
As announced on 29 October 2021, the trial programme for the Company's acoustic deterrent device ("ADD") with Marine Scotland has now concluded and the results are expected in early 2022. The Board continues to believe that the programme data will support and better inform the EPS (European Protected Species) licensing process required to enable the future operation of ADDs within Scottish waters.
As previously announced, one of the Company's main customers has given notice on OTAQ's ADDs operating in Scotland in accordance with the terms of the original agreement ending in April 2022. Accordingly, the Board has taken mitigating action and is considering a range of funding options, including a significant EU development grant for which the Company has successfully completed the first application stage and will understand the outcome of the second stage in 2022. In addition, the Company is reviewing its working capital opportunities and restructuring some of its financial obligations as well as looking to capitalise on current and prospective new opportunities.
The Company continues to make progress on a number of other projects, including the sports tracking project announced last month, the live plankton analysis system in partnership with Blue Lion Labs Inc., new ADD deployment in Chile, railway trials using OTAQ's tracking technology and ADD trials in Australia.
Phil Newby, Chief Executive at OTAQ, commented: "We are delighted to see the continued progress at Minnowtech. It is well placed for growth and we look forward to working with its team in successfully launching their biomass solution which utilises our sonar technology. Minnowtech has worked hard on developing its business plans as well as its product and we can now see a path to growth. As demand grows for its product, OTAQ will benefit from the corresponding sonar deployment."
Ken Malone, co-founder of Minnowtech commented: "Working alongside OTAQ has enabled us to accelerate our product commercialisation so allowing earlier than expected development of our commercial and sales plans. We are extremely excited by the growth potential and step change in both units deployed and returns expected. We have a solution that has been thoroughly tested and look forward to product launch soon."
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Alex Hambro, Non-Executive Chairman
Phil Newby, Chief Executive Officer
Matt Enright, Chief Financial Officer
Dowgate Capital Ltd (Broker & Adviser)
020 3903 7715
David Poutney/James Serjeant
Nicholas Chambers/Russell Cook
Walbrook PR Ltd
Tel: 020 7933 8780 or [email protected]
Tom Cooper/Nick Rome/Nicholas Johnson
0797 122 1972 or 07748 325 236 or 07884 664 686
OTAQ is a highly innovative marine technology company focused on the marine aquaculture, offshore energy, renewables and oceanographic research sectors. It operates in four worldwide locations: Lancaster, Aberdeen and Ulverston in the UK and Puerto Montt in Chile.
OTAQ's marine technology portfolio includes a market-leading intelligent acoustic deterrent system, Sealfence, designed to protect marine-based aquaculture sites from predation, with multiple systems deployed in Scotland, Chile, Finland and Russia.
The Company's Oceansense leak detection systems have a global reputation as the industry standard solution and have been deployed successfully on hundreds of jobs. OTAQ's Dragonfish laser measurement system is fast becoming recognised as one of the most accurate underwater precision laser measurement systems available. OTAQ also has significant experience in the design and manufacture of underwater connectors, penetrators and communication systems.
It seeks to develop and continuously improve its products using its specialist mechanical, electronic and software engineers with decades of experience in bringing underwater technology products to market. Concurrently, OTAQ seeks to expand its technology portfolio through acquisitive growth, with the aim of further expanding its aquaculture and offshore product offering.
OTAQ is proud to be fully ISO 9001:2015 accredited through DNV-GL. ISO 9001 is an internationally recognised quality management system and demonstrates OTAQ's commitment to consistency, continual improvement and customer satisfaction. The certification also demonstrates its ability to consistently deliver products and services to market whilst meeting statutory and regulatory requirements by applying an effective quality management system.
Minnowtech is an aquaculture technology company that provides a software imaging platform that enables shrimp farmers to measure shrimp abundance. Using Minnowtech's data-based imaging tool, shrimp farmers can optimize the health and growth of their crop, enhancing the harvest of market-size shrimp. Learn more: www.minnowtech.com