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Kromek surges as it bags US$990k US contract

It is the second US contract since January's funding, but the company "feels robust about all three of its main areas of operation" CEO Dr Arnab Basu said
Radiation detection
Kromek is a leading developer of high performance radiation detection products

Radiation technology company Kromek Group PLC (LON:KMK) has been awarded a contract worth US$990,000 by an existing customer in the US.

The customer, a global leader in aerospace and defence technologies, has upgraded the advanced security screening detectors it has deployed since 2009.

Kromek will develop and provide the first annual supply of the upgraded detectors. Furthermore, the 12-month contract guarantees that Kromek will continue to be the exclusive supplier for these upgraded detectors for the next 10 years.

Speaking to Proactive Investors, Dr Arnab Basu, chief executive officer of Kromek, explained that the 12-month contract duration covers the hardware delivery part of the relationship with the company.

“This contract provides further validation of the strength of our advanced radiation detection solutions and adds to the visibility of revenues and strengthens our confidence in the continuing growth of the business," Dr Basu said in the company's stock exchange announcement.

The company raised £21mln in late January to underpin its growth plans, since when it has announced two contract wins, adding credence to Dr Basu's assertion that "we have a fantastic pipeline in front of us".

Although the last two contract wins were both from US-based customers, Dr Basu is excited about the growth opportunities available in Asia, and in particular China, on the medical imaging side of the business.

"Technology is being embraced and developed in China at a rapid rate," he said in response to a question about whether he had misgivings about dealing with China, given its reputation for being on the free and easy side in terms of respecting patents and intellectual property.

"You can either ignore China or you can embrace it. The key is finding the right partner," he said.

Shares in Kromek were up 5.1% at 32.72p in morning trading.

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