Shares in leading radiation detection products developer Kromek (KMK:AIM) surged 12% to 16.8p after the company was awarded a new $6 million contract by the US Department of Defense.

The contract forms part of the second phase of DARPA’s (Defense Advanced Research Projects Agency) development of a biological threat detection system that is designed to sense, analyse and identify airborne pathogens via rapid DNA-sequencing.

Phase two is an extension of the existing SIGMA+ threat initiative and follows the completion of phase one, which included the development of a vehicle-mounted biological threat identifier and a miniaturised mobile wide-area bio-surveillance system.

Chief executive Dr. Arnab Basu commented: ‘In addition to the ever-present danger of bio-terrorism, the outbreak of the pandemic has exposed the world to the severity of biological threats and their potential impact on public health and the global economy and has demonstrated the need to rapidly evolve bio-security systems and associated technologies.’

MATERIAL VALUE

Today’s announcement takes the overall programme value awarded to Kromek to around $13 million.

Investment research house Cenkos said: ‘We believe the commercial value of the system once rolled out could provide a revenue opportunity materially in excess of the development value awarded to date.’

Cenkos forecasts £5 million of incremental revenues to 30 April 2022 to £15 million. Kromek owns the intellectual property and rights to commercialise SIGMA outside the US.

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Issue Date: 14 Jun 2021