The gain is relative. Today's stock price jump, which takes Straker to an A$89m market cap, saw it pull ahead of its September 2018 listing price of A$1.51 after prolonged trading below that mark. However, it remains below its all-time high of A$2.10, hit in July just year.
Straker Translations, founded by one-time paratrooper Straker and his wife Merryn in 1999, has long had a relationship with IBM, using the US company's AI platform and cloud computing service.
But it became a two-way street last year when Straker acquired a Barcelona-based rival, MMS (one of seven acquisitions of small translation players), which supplied Spanish translation services to IBM.
Now, from the New Year under the new deal, Straker's RAY platform will directly link to IBM's technology platforms to provide translation capabilities across 55 languages for Big Blue's Adaptive Translation Services.
In an ASX filing, Straker said the revenue generated by the deal would be "material" but also impossible to quantify at this point because of the nature of the deal, which will see remuneration based on time, and whatever volume of translation business it ends up generating.
Straker's financial year ends on March 31. The first impact of the expanded IBM business will be seen in the final quarter, Straker says.
There are a number of free translation services, from Google and others, Straker says his company uses superior artificial intelligence, then fills in gaps with its secret sauce - an army of 13,000 crowdsourced humans.
Straker estimates the language translation market is worth some US$57 billion per year, but says it's highly fragmented with hundreds of small players. Allying with a tech giant like IBM is one way for his company to stand above the crowd.
In a first-quarter FY2021 update, Straker Translations said it annualised revenue rate was tracking to $30.7m.
Total customer receipts were up 13.1 per cent to $6.9m but total cash flow was -$2.5m after earn-out payments and increased R&D spending.
Straker's cash balance was $8.7m as of June 30.
The company took $409,000 in Covid wage subsidies.
Postscript: a snipe with analysts
Straker Translations CEO Grant Straker bemoaned his company's lack of coverage as its ASX-listed stock surged yesterday.
Not a single New Zealand analyst follows his company.
"They should take 10 minutes to drive across the bridge and come and see us," he told the Herald.
The Auckland-based Straker opted for an ASX-only listing.
Last month, Jarden chief executive James Lee told NBR there could be downsides to listing across the Tasman.
"Heaven forbid you have something go wrong in Australia - your stock price gets crucified, no-one cares about you, there's no research, there's no one to talk to," says Lee.
"Straker is a good example. It hasn't performed perfectly and very quickly it's been ignored and they move on to the next best thing."
Today, Lee told the Herald that Staker had done well with its latest deal. But it is still a small-cap, and his company, like other wealth managers, doesn't cover small-caps - on either side of the Tasman.
The Jarden boss told the Herald, "It's great to see Straker announce further [expansion] to their relationship with IBM and it's a good day for their shareholders.
"I can understand his frustration, but being dual-listed is generally a minimum for many wealth management firms to cover for their clients and being sub-$100m market cap makes it hard for Investment banks to cover."
