Aeeris has more than 100 corporate and government clients, paying from $100 a month up to the tens of thousands a month, depending on the level of service required, the area covered, detail and range of risks, and the number of individual alerts.
When it arrives on the stockmarket next month, Aeeris Limited will certainly join the ranks of the market’s unique businesses.
The digital media company and technology developer operates the Early Warning Network (EWN), an “all-hazards” alert service the company describes as the only national location-based emergency and threat warning service.
The EWN is based on Aeeris’ proprietary GNIS (geographical notification and information system) system, developed by Aeeris executive chairman and chief executive Kerry Plowright.
The GNIS system takes field data feeds from multiple third-party sources, both locally and globally, which include government agencies and private weather centres, as well as using internal analysis, remote sensing, field observations and a diverse range of other inputs. This data is processed by EWN’s proprietary GNIS system and expert alerts team, and generates localised warnings of severe weather events and natural hazards – it could be lightning, storms, flash-floods, extreme wind or bushfires, power outages, or even coronial mass ejections (CMEs), which can spark geo-magnetic storms that can wreak havoc on radio communications and electricity supply.
“We take in all of those feeds, and apply our processes, a lot of which is rules-based, because every client has different thresholds, and send alerts where needed. The warnings we push out depend on the client’s requirements,” says Plowright. Alerts go out over multiple platforms: SMS, text-to-voice, Twitter, email, a push notification (through mobile apps), to Facebook, to the internet.
“Alerts are massaged around the customer’s threat thresholds, but can usually go out in three minutes. For example, we do flash-flood warnings for councils, for specific areas that are known to experience that. We’re measuring river gauges and rain gauges. We can put thresholds around certain clusters of data sources, where if they receive a certain amount of rain, it kicks off a warning into our system. We then validate that and subsequently push off a warning to customers.”
A rail company may have concerns about wind over certain parts of the track, because it can affect cargo loads, says Plowright. “They have lodged certain thresholds with us, within which they can operate safely, and they need to know when those might be breached. You might have a port authority that is moving containers but they can’t do that when the wind goes over 30 kilometres an hour – they need to know, seven days out, where those thresholds are going to be. Other customers want a trajectory for relevant warnings over the next seven days, updated every few hours. Out beyond seven days, the data gets pretty fluffy,” he says.
Location is very important, he says. “It’s not just the ability we have to identify an extreme weather event, it’s the ability to identify where these events are occurring. For most of these events we produce a polygon on a map, and part of that polygon might cross an asset that somebody owns, or part of an asset, or it might cross an area that somebody has given us and said, ‘we need to know if any alerts encroach on this area.’
“Our system, for example, would geo-locate a bushfire or a lightning event – we can localise that down to three metres – and our system would then push out an alert to wind farms, or infrastructure owners, in the area, where the event occurs within the perimeter they have lodged with us. The client might say, ‘if this amount of lightning strikes happen, within 30 minutes, within say five kilometres of our asset, or 20 kilometres, we want to know about it.’ Our system will work that out.”
"We think the frequency of extreme weather events
and natural disasters is increasing, and governments
need to predict and warn the public and protect people."
Aeeris CEO Kerry Plowright
Insurance companies subscribing to the service can be notified in three minutes of a risk upgrade of an extreme weather event. Data is detailed to the level of risk levels to individual houses.
Aeeris has more than 100 corporate and government clients, paying from $100 a month up to the tens of thousands a month, depending on the level of service required, the area covered, detail and range of risks, and the number of individual alerts. The strategy to-date has been to sign big companies up with a four to six week pilot trial and then progressively increase their subscription as the service proves its worth.
Customers include insurer Elders Insurance, as well as some of the biggest players in Australia’s resource and utilities sectors such as BHP Billiton, BlueScope Steel, AGL Energy, Xstrata and Caltex Australia, construction heavyweights Thiess, Leighton Contractors and Lend Lease, logistics firms Linfox and Patrick, and grocery wholesaler Metcash. Another major source of customers is local government and state authorities, including NSW State Water, SEQ Water, Queensland’s Lockyer Valley Regional Council, Gladstone Regional Council, and Brisbane City Council.
The company also has 185,000 social media subscribers, with more than 43,000 app and Facebook users.
Plowright, who was previously an Army Officer before share farming in Central Queensland and then getting involved in marketing, sales and e-commerce, says he got the idea for the EWN back in 2006. “There were a lot of bushfires around, I looked out the window at the severe weather and thought, ‘why aren’t these sorts of events being warned-for in a precise way?’ I then spent the next year developing a system to do exactly that.
“We think the frequency of extreme weather events and natural disasters is increasing, and governments need to predict and warn the public and protect people, businesses and individuals need to protect people and assets, but they haven’t had a systematic way to do it before the EWN came along.”
While death and injury and property loss and damage are the headlines that can result from severe weather and natural disasters, Plowright says businesses also need to guard against business disruption, lost productivity and legal liability, for example, failure to comply with Work, Health and Safety Act. “Things like the state government bushfire alerts are often too late for commercial customers, asset owners, to take mitigative action. The state government alerts certainly save lives, but our commercial customers very much want greater situational awareness, so they can manage their business accordingly.”
Plowright says the economic cost of natural disasters in Australia is expected to double by 2030 and reach $23 billion by 2050. He estimates the market is worth about $100 million, and growing rapidly. As well, Aeeris’ business model is “robust and scalable,” and can be quickly and easily deployed into international markets.
In its initial public offering, Aeeris is raising $6 million at 25¢ a share, to take the valuation of the company to $16 million when it lists on the Australian Securities Exchange (ASX). Plowright says the float proceeds will be invested in sales and business development, and new products. “Most of the heavy investment in technology has been made, the business was essentially breakeven for FY14, and the company is confident of further growth in the future.”
The lead broker is wholesale broker Veritas Securities, which is using the ASX Book-Build facility to widen the spread of the raising. “If we raise the full $6 million, $2 million of that will be raised through the ASX Book-Build,” says Bryce Reynolds, managing director of Veritas. “It’s great for us because of instead of us approaching other brokers, any market participant can bid into the book-build. We think it’s a great way to get the story out to a wider audience.”
Further information on Aeeris is available on the Aeeris website including a copy of the prospectus and application form. Applications for the IPO can also be made via the ASX On Market Bookbuild Facility using the code is ASX: AERXBB. www.aeeris.com.
