The world’s first welding-as-a-service company is set to launch its CSIRO-developed technology onto the ASX next week.
Adelaide-based K-TIG offers precision robotic welding that it claims saves time, materials and money.
Blue-chip firms GE, Siemens and Bilfinger are among clients in 20 countries already making use of a system that chief executive David Williams says can perform a three-hour tungsten inert gas (TIG) weld in just two or three minutes.
“In one pass, we can put the (welding) arc through the keyhole,” Mr Williams said.
“There’s a lot of advantage for fabricators of stainless steel and more exotic metals.”
Unlike conventional TIG welding, the K-TIG or “keyhole TIG” system requires no edge bevelling of the materials to be welded together, and doesn’t use as much expensive filler material.
The system is being used for making pressure vessels, ISO tanks for shipping liquids, pressure vessels and stainless steel welded pipes, the company says.
Mr Williams said one client in Argentina used it to deliver 15km of pipeline 550 days ahead of schedule.
K-TIG was developed by CSIRO’s former Division of Manufacturing Technologies and was named Australia’s industrial product of the year in 2014.
Mr Williams said that people in the industry have at first scoffed at the company’s “welding as a service” model.
But when they see customers paying only a variable fee depending on the size of the task, “they say that’s fantastic – there’s no one doing this in the industry,” Mr Williams said
TIG welding is complex and more difficult to master than other types of welding, and welders used to working with exotic materials such as titanium and various alloys tend to be in their fifties, Mr Williams said.
“All the people that used to do welding of exotic materials are disappearing,” he said.
The K-TIG system lets customers in high-wage countries like the US, UK and Australia compete with Asia, he said.
“They can compete on cost, with better quality and faster time of delivery,” Mr Williams said.
The K-TIG system is also an “internet of things” device, communicating with the K-TIG headquarters in Adelaide.
Mr Williams said the company can monitor customers’ use of the system in real time, making sure they are using it correctly and automatically storing the details of each weld in K-TIG’s computers.
“It’s a really exciting development,” Mr Williams said.
So far though, K-TIG hasn’t been profitable, reporting a $1.7 million loss for the 12 months to June 30, up from a $458,302 loss the previous year.
It had $1 million in revenue, down from $2.2 million in FY18, as it transitions to its welding-as-a-service model.
Mr Williams said prospective investors are not going to be “blown out of the water” with the company’s revenue but the licensing model would give it a monthly recurring income.
K-TIG plans to backdoor list on Monday through Perth shell company Serpentine Technologies following a $7 million capital raise.
Shareholders will be hoping that precision welding is more successful than the corporate entity’s previous businesses.
It first listed as WA base metals explorer Magnolia Resources in 2012, then acquired an interior design e-commerce platform and changed its name to Whole New Home in 2015, and then changed its name to Kabuni the following year.
In 2017, Kabuni sold most of its assets to Print the Future, a new company owned by former chief executive Neil Patel, but Print the Future has failed to repay the $4.4 million promissory note, according to numerous ASX filings.