Covata (AX:CVT) has raised A$2m from institutional and retail investors, bolstering its cash position. The company is making progress with the development of its data security platform, and plans to launch a beta version by the end of the current quarter. New customer contracts have been signed for SafeShare and CipherPoint and the company has a growing sales pipeline.
Funds raised
The fund-raising announced by Covata in October raised A$425k via an institutional placing (9.0m shares at 4.7c per share) and A$1.637m via a retail offering (34.8m shares at 4.7c per share). Covata had net cash of A$4.5m at the end of Q118; in Q218, it expects a total cash outflow of A$2m (before revenues and interest income) and an R&D tax credit receipt of A$1.5m. Based on these numbers, Covata should have a net cash position of at least A$6.0m by the end of Q218.
Making progress with platform and contract wins
Covata expects to launch the beta version of its DSP platform, CovataSecure 1.0, by the end of Q218. It recently made SafeShare available on Microsoft’s Azure cloud platform and has since signed up a new customer to use SafeShare via Azure on a three-year subscription. The Macquarie Telecom partnership agreement has been renegotiated – with 23 government departments using SafeShare via this agreement, we anticipate a positive impact on revenues from Q218.
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