Vital wins $20 million contract to upgrade St John communications systems

NZX-listed Vital (formerly TeamTalk) says it has won a major contract to upgrade ambulance operator St John's communications systems.

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The Herald understands from a well-placed source that the deal is worth $20 million.

Vital was the incumbent. There is provision for two further extensions - against the background of a sweeping reorganisation of emergency services communications that will see St John's network fall under a fully-funded model for the first time.

Vital chief executive Andrew Miller would not comment on the amount, but told the Herald it was substantial enough to warrant a market disclosure.

The ambulance operator has historically used various sources to pay for its communications networks.

It will transition to a fully-funded communication network as it comes under the Next Generation Critical Communications (NGCC) initiative as it is phased in for all emergency services. The NGCC will provide a single, modernised communications network for Fire, Police, St John and the Wellington Free Ambulance service, replacing current "voice-centric" systems. (Historically, there has been a degree of Balkanisation, with Vital and Kordia and various telcos involved).

Funding for the NGCC was signed off by Cabinet last month, the Herald understands, but the Government is still some distance from deciding which vendor, or mix of vendors, will provide the single emergency communications network, or its shape (Vodafone has been promoting the merits of 5G over walkie talkies, for example.)

Miller confirms the contract just signed by Vital does not fall under the NGCC.

The Vital boss, who is not expecting the first NGCC request for proposals (RFP) until around August, said his company's new contract was "in parallel" with the envisaged unified network and offered St John "assurance" in the meantime. Once the NGCC framework was in place, Vital would help the ambulance operator transition, Miller said.

In the meantime, the network comprises 168 sites across New Zealand enabling reliable communications to over 700 operational vehicles and 209 ambulance stations all co-ordinated through three inter-linked communication centres located in Auckland, Christchurch and Wellington.

A spokeswoman for St John said the Vital contract had been paid for from general funds, some of which came from the Crown. It was designed to tide the ambulance operator over until the NGCC kicked in.

Signs of Vital

Vital has no relationship to Vital Healthcare, also listed on the local exchange.

Rather it is a rebrand of the company formerly known as TeamTalk.

The renaming, which took place in April last year, came after the sale of its Farmside rural broadband business to Vodafone NZ, and the departure of the company's founder - the colourful David Ware.

Vital is now focusing on its radio network for emergency services, and its fibre network in Wellington (which was formerly known as CityLink but now also bears Vital branding).

The company recently reported first-half profit of $522,000 (from the year-ago $1.9m) on revenue that slipped 2 per cent to $16.6m.

Vital shares were recently trading at 72c. The stock is down 15.3c over the past 12 months and well off its all-time high of $2.86.