- Water treatment company De.mem (DEM) has signed a $400,000 contract with an Australian power company
- Under the contract, water treated from De.mem's tech will be used as part of the power generation process
- While De.mem did not name the new customer, it said this is a significant contract because it effectively creates a new product offering for the company
- CEO and Managing Director Andreas Kroell says moving forward, the company will add this product to its standard product offering for industrial customers
- Shares in De.mem are trading grey this afternoon, currently worth 24 cents each
Water treatment company De.mem (DEM) has signed a $400,000 contract with an Australian power company.
De.mem said under the contract, it will deliver its water treatment equipment to an Australian power station. The ultra-pure, de-ionized water made from the treatment system will be used as part of the power generation process.
While De.mem did not name the new customer, it said this is a significant contract because it effectively creates a new product offering for the Australian power generation customer segment.
The roughly-$400,000 will be the first revenue De.mem pulls in from this sector.
Looking ahead, the company said it plans to offer this product as a standard product line to customers in the energy, electronics, semiconductor, and other industrial sectors.
De.mem CEO Andreas Kroell said the demand from industrial customers for this type of water treatment system is large.
"This new contract improves revenue quality by effectively creating a new product line and expanding our reach into the highly desirable industry segment of power generation, with institutional customers and stable cashflow," Andreas said.
"We will add this product to our standard product offering going forward, and will further promote it into our industrial customer base," he said.
De.mem said most of the revenue from this contract will be recognised in 2021, and as such the impact of the order on 2020 revenues is immaterial.
Nevertheless, the company reaffirmed its 2020 calendar year guidance of between $14 million and $18 million in annual revenue.
Today's news comes just a few weeks after De.mem signed an $800,000 contract with flavour and fragrance creator Givaudan.
Shares in De.mem are trading grey this afternoon, currently worth 24 cents each at 1:34 pm AEST.