13 Feb 19. Applied Insight Boosts Cloud, Artificial Intelligence and Advanced Analytics Capabilities with Acquisition of ATG and Stratus Solutions. Applied Insight, a market leader in solving complex technology challenges for federal government customers, backed by The Acacia Group, has announced today its acquisition of Applied Technology Group and Stratus Solutions. These acquisitions strengthen Applied Insight’s advanced cloud, analytics and artificial intelligence capabilities to benefit customers across the intelligence, defense and federal civilian communities.
The addition of ATG and Stratus marks the latest development in AI’s strategy of building an agile mid-market business supporting the federal government. The strategy sees the company combining its mission intimacy with leading-edge capabilities in analytics, cybersecurity, cloud computing and mission IT to navigate customers to technologies that enable better collaboration and decision-making.
“At AI, we’re adept at aligning the right people and technologies with our customers’ missions,” said John Hynes, AI CEO. “We know that the challenges of working with confidence in the cloud and effectively marshaling big data for actionable intelligence are widespread across government. Our new colleagues at ATG and Stratus are highly accomplished problem-solvers and innovators in these fields. We’re particularly encouraged by the potential of what they can do together as part of AI. For example, we’ll be exploring how our cloud governance, machine learning and cyber capabilities can help customers better manage the need for both control and flexibility for their cloud infrastructures at scale. It’s an exciting prospect.”
“ATG and Stratus are important advances in our strategy for AppIied Insight,” said Gavin Long, managing partner in The Acacia Group. “In becoming part of AI, with its broad customer base across the federal government, both ATG and Stratus have a clear route to new federal customers. We’re backing them with R&D investment to further develop their capabilities as customer requirements flex and change. Additionally, they can leverage AI’s support and BD infrastructure to pursue prime full-and-open opportunities. We see great potential in bringing them in to AI to work at the nexus of cloud computing, analytics, artificial intelligence and cybersecurity.”
ATG and Stratus bring complementary technologies, talent and expertise to AI’s range of capabilities.
- ATG, founded in 2009 and based in Eldersburg, Maryland, is a company with a growing team of around 80 highly skilled software engineers and data specialists with deep roots in the U.S. national security community. Their work involves solving some of the most challenging and complex data analytics problems facing that community today, with the mission of establishing data relevance and insight to help their customers act decisively and at pace. ATG’s analytics expertise extends across machine learning/deep learning, complex algorithm R&D, high-speed data collection and repository building, cloud computing, and DevOps. The company maintains an extensive knowledge of the latest data technologies to help customers navigate to the right tools for their mission.
- Stratus Solutions, founded in 2008 and based in Fulton, Maryland, specializes in cloud-at-scale solutions that give customers greater command and control, insight, and security for their public and private cloud deployments. Their team of around 100 people work in many complex and sensitive mission environments, with particular expertise in cloud infrastructure, research and development of analytics, agile DevOps, and intelligent automation. Stratus is an AWS Advanced Consulting Partner and is experienced with AWS, MS Azure, VMWare, OpenStack and a range of other platforms.
The acquisition of Stratus Solutions was completed in December, and Applied Technology Group was acquired earlier in 2018. Teneo’s Capital Advisory division acted as exclusive financial adviser to both Stratus Solutions and ATG on the acquisition transactions.(Source: BUSINESS WIRE)
14 Feb 19. Airbus’ fourth-quarter profits rise and beat expectations. Airbus on Thursday posted stronger than expected fourth-quarter results overshadowed by a decision to close its flagship A380 program, while forecasting higher aircraft deliveries and profits in 2019. Europe’s largest aerospace group posted quarterly adjusted operating profit of 3.096bn euros ($3.5bn), up 56 percent from the same period in the previous year, after accelerating jetliner deliveries in the last three months to make up for earlier delays. Revenues rose 11 percent to 23.286bn euros. Analysts had expected quarterly adjusted operating income of 2.292bn euros on revenues of 22.372 bn, according to a survey carried out for Reuters. An Airbus-compiled consensus pointed to core income of 2.36 bn euros on revenues of 22.818bn. Airbus predicted 880-890 commercial aircraft deliveries and a 15 percent higher operating profit in 2019. (Source: Reuters)
14 Feb 19. Airbus SE (stock exchange symbol: AIR) reported strong Full-Year (FY) 2018 consolidated financial results and delivered on its guidance for all key performance indicators.
“Though 2018 had plenty of challenges for us, we delivered on our commitments with record profitability thanks to a strong operational performance, particularly in Q4,” said Airbus Chief Executive Officer Tom Enders. “With an order backlog of around 7,600 aircraft, we intend to ramp-up aircraft production even further. However, due to the lack of airline demand we have to wind down production of the A380. This is largely reflected in the 2018 numbers. On A400M, we succeeded in re-baselining the programme with our government customers and their domestic approval processes should conclude in the coming months. All in all, we have achieved significant de-risking of the A400M in 2018. The strength of last year’s achievements is reflected in our record dividend proposal. In sum, Airbus stands on a solid growth trajectory and our helicopter, defence and space businesses are also in good shape as the new management team under my successor Guillaume Faury gets ready to take over.”
As of 1 July 2018, the A220 aircraft programme has been consolidated into Airbus.
Net commercial aircraft orders totalled 747 (2017: 1,109 aircraft), including 40 A350 XWBs, 27 A330s and 135 A220s. Showing the underlying health of the market, the order backlog reached an industry record of 7,577 commercial aircraft at year-end, including 480 A220s.(4) Net helicopter orders increased to 381 units (2017: 335 units) with a book-to-bill ratio above 1 in terms of both value and units. Order intake included 15 H160 and 29 NH90 helicopters. Airbus Defence and Space’s 2018 order intake of around € 8.4 bn included the Eurofighter for Qatar, four A330 MRTT tanker aircraft and two new generation telecommunication satellites.
Consolidated order intake(4) in 2018 totalled € 55.5bn with the consolidated order book(4) valued at €460 bn on 31 December 2018 under IFRS 15.
Consolidated revenues increased to € 63.7 bn (2017: € 59.0bn(1)), mainly reflecting the record commercial aircraft deliveries. At Airbus, a total of 800 commercial aircraft were delivered (2017: 718 aircraft), comprising 20 A220s, 626 A320 Family, 49 A330s, 93 A350s and 12 A380s. Airbus Helicopters delivered 356 units (2017: 409 units) with revenues stable year-on-year on a comparable basis despite the lower deliveries. Higher revenues at Airbus Defence and Space were supported by its Space Systems and Military Aircraft activities.
Consolidated EBIT Adjusted – an alternative performance measure and key indicator capturing the underlying business margin by excluding material charges or profits caused by movements in provisions related to programmes, restructurings or foreign exchange impacts as well as capital gains/losses from the disposal and acquisition of businesses – totalled
€ 5,834m (2017: € 3,190m(1)), reflecting the strong operational performance and programme execution across the Company.
Airbus’ EBIT Adjusted increased to € 4,808m (2017: € 2,383m(1)) reflecting the higher aircraft deliveries. The strong improvement compared to 2017 is driven by progress on the learning curve and pricing for the A350 as well as the A320neo ramp-up and pricing premium. Currency hedging rates also contributed favourably.
On the A220 programme, the focus remains on commercial momentum, the production ramp-up and cost reduction. A320neo Family deliveries increased to 386 aircraft (2017: 181 aircraft) and represented over 60% of overall A320 Family deliveries during 2018. The first long-range A321LR was delivered in the fourth quarter. Deliveries of the Airbus Cabin Flex version of the A321 are expected to increase in 2019 although the ramp-up will remain challenging. Further upgrades of the Pratt & Whitney GTF engine for the A320neo are due to arrive in 2019. Airbus continues to monitor in-service engine performance. Overall, the A320 programme is on track to reach the monthly targeted production rate of 60 aircraft by mid-2019 with rate 63 targeted in 2021. On the A330neo programme, the first A330-900s were delivered and the smaller A330-800 conducted its maiden flight in the final quarter of 2018. In 2019, A330neo deliveries are due to ramp-up. Airbus is working closely with its A330neo engine partner to deliver on customer commitments.
Following a review of its operations, Emirates is reducing its A380 orderbook by 39 aircraft with 14 A380s remaining in the backlog yet to be delivered to Emirates. As a consequence of this decision and given the lack of order backlog with other airlines, deliveries of the A380 will cease in 2021. The recognition of the onerous contract provision as well as other specific provisions and the remeasurement of the liabilities have led to a negative impact on EBIT of € -463m and a positive impact on the other financial result of € 177m.
A350 deliveries increased compared to 2017 and included 14 of the larger A350-1000s. The programme reached rate 10 in the fourth quarter of 2018. The backlog supports this rate going forward, including the latest commercial discussions with Etihad to reduce its A350 order by 42 A350-900, leaving 20 A350-1000 for Etihad in the backlog. Airbus will continue to improve the A350 programme’s performance to reach breakeven in 2019 and improve margins beyond this.
Airbus Helicopters’ EBIT Adjusted increased to € 380m (2017: € 247m(1)), reflecting higher Super Puma Family deliveries, a favourable mix and solid underlying programme execution.
Airbus Defence and Space’s EBIT Adjusted totalled € 935m (2017: € 815m(1)), mainly reflecting solid programme execution. On the A400M programme, 17 aircraft were delivered during the year (2017: 19 aircraft). Airbus continued with development activities toward achieving the revised capability roadmap. Retrofit activities are progressing in line with the customer agreed plan. The customer Nations are now set to pursue their domestic approval processes. An update of the contract estimate at completion triggered a net additional charge of € -436m on the programme. This mainly reflects the outcome of the negotiations and updated estimates on the export scenario, escalation and some cost increases. Risks remain on the development of technical capabilities and the associated costs, on securing sufficient export orders in time, on aircraft operational reliability in particular with regards to engines, and on cost reductions as per the revised baseline.
Consolidated self-financed R&D expenses totalled € 3,217m (2017: € 2,807m).
Consolidated EBIT (reported) amounted to € 5,048m (2017: € 2,665m(1)), including Adjustments totalling a net € -786 m. These Adjustments comprised:
- The net negative impact of € -463m related to the A380 programme;
- The net additional charge of €-436m for the A400M programme;
- A negative €-123m related to compliance costs;
- A positive €188m related to Mergers and Acquisitions, including the sale of Airbus DS Communications, Inc. business in the first quarter;
- A positive €129m relating to the dollar pre-delivery payment mismatch and balance sheet revaluation;
- A negative €-81m related to other costs.
Consolidated net income(2) of €3,054m (2017: €2,361m(1)) and earnings per share of €3.94 (2017: € 3.05(1)) included a negative impact from the financial result, mainly driven by the evolution of the US dollar and revaluation of financial instruments. The other financial result also included the positive adjustment of €177m from the A380. The finance result was €-763m (2017: €+1,161m(1)).
Consolidated free cash flow before M&A and customer financing was stable at €2,912m (2017: €2,949m) including the A220 dilution, supported by the earnings performance and record deliveries. Consolidated free cash flow of €3,505m (2017: €3,735m) included around €0.5bn related to M&A activities. The consolidated net cash position on 31 December 2018 was stable at € 13.3 bn (year-end 2017: € 13.4 bn) after the 2017 dividend payment of € 1.2bn and pension funding of € 2.5bn, including €1.3bn in the fourth quarter. The gross cash position was €22.2bn (year-end 2017: €24.6bn).
The Board of Directors will propose to the Annual General Meeting the payment of a 2018 dividend of €1.65 per share on 17 April 2019 (2017: €1.50 per share). This reflects the strength of the 2018 achievements. The date of record is 16 April 2019.
Outlook
As the basis for its 2019 guidance, the Company expects the world economy and air traffic to grow in line with prevailing independent forecasts, which assume no major disruptions. The 2019 earnings and Free Cash Flow guidance is before M&A.
- Airbus targets 880 to 890 commercial aircraft deliveries in 2019.
- On that basis:
Airbus expects to deliver an increase in EBIT Adjusted of approximately +15% compared to 2018 and FCF before M&A and Customer Financing of approximately €4bn.
13 Feb 19. FLIR Systems Announces Fourth Quarter and Full Year 2018 Financial Results.
Record Full Year GAAP EPS of $2.01;
Adjusted EPS of $2.22, Up 18% over Prior Year. Record Full Year Operating Cash Flow of $374m, Up 21% over Prior Year Full Year Revenue Decline of 1%; Organic Revenue Growth of 6% over Prior Year
Fourth Quarter Organic Bookings Growth of 20% over Prior Year
Repurchased $144m in Shares in the Fourth Quarter
FLIR Systems, Inc. (NASDAQ: FLIR) today announced financial results for the fourth quarter and full year ended December 31, 2018. “I’m proud of our team’s performance in 2018,” said Jim Cannon, FLIR President and Chief Executive Officer. “We achieved organic revenue growth and margin performance the Company hasn’t reached in many years, and we delivered record adjusted earnings per share and operating cash flow. We are well-positioned for 2019 with strong bookings, numerous new product launches, and the recently announced acquisitions of Aeryon Labs and Endeavor Robotics, moving us forward in the execution of our unmanned integrated systems strategy.”
Mr. Cannon continued, “This was a transformational year for FLIR as we began to execute on our strategic vision to Fuel, Feed, and Focus the business with The FLIR Method as the Foundation. I am more confident than ever in our ability to deliver on our strategic priorities and our purpose to innovate the World’s Sixth Sense to save lives and livelihoods.”
Fourth Quarter 2018
Fourth quarter 2018 revenue was $448.5m, 9.4% lower than fourth quarter 2017 revenue of $494.8m, which included revenue of $46.8m from the previously disclosed divested security businesses. Organic revenue growth was flat compared to the prior year.
GAAP Earnings Results
GAAP gross profit in the fourth quarter 2018 was $227.8m, compared to $237.8m in the fourth quarter of 2017. GAAP gross margin increased 270 basis points to 50.8% in the fourth quarter 2018, compared with 48.1% in the prior year. GAAP operating income in the fourth quarter increased 11.3% to $85.9m, compared to $77.2m in the prior year, representing a 360 basis point improvement in operating margin.
Fourth quarter 2018 GAAP net earnings were $98.5m, or $0.71 per diluted share, compared with GAAP net loss of $50.3m, or ($0.36) per diluted share in the fourth quarter last year. Fourth quarter 2018 GAAP net earnings increase was driven primarily by a $33.3m reduction in accrued income tax as a result of the settlement of tax assessments issued by Belgium in connection with the European Commission’s 2016 decision on state aid (“Belgium tax item”). Fourth quarter 2017 GAAP earnings were negatively impacted by a non-cash loss on net assets held for sale, as well as discrete tax items associated with the enactment of U.S. tax reform.
Cash provided by operations was $98.3m in the fourth quarter of 2018, compared to $98.9m in the fourth quarter of 2017. Approximately 3.0m shares were repurchased in the fourth quarter of 2018 at an average price of $47.80.
Non-GAAP Earnings Results
Adjusted gross profit was $233.5m in the fourth quarter 2018, down from adjusted gross profit of $242.9m in the fourth quarter of 2017. Adjusted gross margin increased 300 basis points to 52.1%, compared with 49.1% in the fourth quarter of 2017. Adjusted operating income was $107.9m in the fourth quarter, which was 3.4% lower than adjusted operating income of $111.7m in the fourth quarter of 2017. Adjusted operating margin increased 150 basis points to 24.1%, compared with 22.6% in the fourth quarter of 2017.
Adjusted net earnings in the fourth quarter 2018 were $85.8m, or $0.62 per diluted share, which was 6.9% higher than adjusted earnings per diluted share of $0.58 in the fourth quarter of 2017.
Business Unit Results
Fourth quarter 2018 revenue from the Industrial Business Unit was $181.7m, in-line with fourth quarter 2017 revenue of $181.7m with increased sales of cooled thermal cores, unmanned aerial systems (UAS), and automotive solutions offset by decreased instruments and uncooled core sales. The Government and Defense Business Unit contributed revenue of $171.1m during the fourth quarter, down 2.5% from the prior year, with strength in UAS, integrated systems, and maritime offset by declines in CBRNE systems and impacts from the government shutdown. The Commercial Business Unit recorded $95.7m of revenue in the fourth quarter, down 30.5% from the prior year. Commercial organic revenue growth increased 5.4% in the same period excluding revenue from the previously disclosed divested security businesses. Strong results in security and intelligent transportation systems contributed to the organic revenue growth.
Full Year 2018
For the full year, 2018 revenue was $1,775.7m, down 1.4% compared to $1,800.4m for the year ended December 31, 2017. Organic revenue growth was 6.4%, excluding the previously disclosed divested security businesses which included revenue of $140.4m in 2017.
GAAP Earnings Results
GAAP operating income for 2018 was $318.6m, compared to $290.0m in 2017, with 2017 being negatively impacted by the non-cash loss on net assets held for sale. GAAP operating margin was 17.9% in 2018, compared with 16.1% in 2017, representing a 180 basis point improvement.
2018 GAAP net earnings were $282.4m, or $2.01 per diluted share, compared with 2017 GAAP net earnings of $107.2m, or $0.77 per diluted share. 2018 GAAP net earnings increase was driven primarily by the previously discussed Belgium tax item, and U.S. Federal transition tax due as a result of the U.S. Tax Cuts and Jobs Act. 2017 GAAP earnings were negatively impacted by the non-cash loss on net assets held for sale, as well as discrete tax items associated with the enactment of U.S. tax reform.
Cash provided by operations during 2018 was $374.2m, compared to $308.3m in the prior year, a 21.4% increase. Approximately 5.0m shares were repurchased in 2018 at an average price of $48.88.
Non-GAAP Earnings Results
Adjusted operating income for 2018 was $403.7m, 11.1% higher than 2017 adjusted operating income of $363.5m. Adjusted operating margin increased 250 basis points to 22.7% in 2018, compared with 20.2% in 2017.
Adjusted net earnings in 2018 were $311.8m, or $2.22 per diluted share, which increased 18.1% over 2017 adjusted earnings per diluted share of $1.88.
Business Unit Results
Full year 2018 revenue from the Industrial Business Unit was $717.9m, an increase of 6.8% over last year driven by increased sales of cooled thermal cores, optical gas products, UAS, and automotive solutions. The Government and Defense Business Unit contributed revenue of $663.4m during 2018, up 5.4% over 2017, with strength in land systems, UAS, and radiation detection products. The Commercial Business Unit recorded revenue of $394.4m during 2018, down 21.0% from the prior year. Commercial organic revenue growth increased 7.3% in the same period excluding revenue from the previously disclosed divested security businesses. Strong results in maritime and intelligent transportation systems contributed to the organic revenue growth.
Financial Outlook for 2019
FLIR estimates revenue in 2019 to be in the range of $1.92bn to $1.95bn. This represents 8% to 10% revenue growth compared to 2018, including approximately 5% organic revenue growth, in-line with our strategic plan presented in May 2018. FLIR also expects 2019 adjusted operating income margins to be in the range of 22% to 23%, and adjusted earnings per diluted share to be in the range of $2.30 to $2.36. 2019 financial outlook includes contributions from the recently announced Aeryon Labs and Endeavor Robotics acquisitions. Adjusted earnings per share assumes an effective tax rate of 20.5%, net interest expense of $25.5m and a diluted share count of approximately 137.7m shares.
Dividend Declaration
FLIR’s Board of Directors has approved a quarterly cash dividend of $0.17 per share on FLIR common stock, an increase of 6% over the previous quarterly dividend of $0.16 per share. The Board of Directors has declared the dividend payable on March 8, 2019, to shareholders of record as of close of business on February 22, 2019.
12 Feb 19. CAE’s defence revenues surge. Revenues surged for the defence and security division of Canadian simulation systems company CAE during its third fiscal quarter, far outpacing progress on its civil side.
Revenues in the division increased to CAD330.2m (USD248.5m), up 27% compared with the corresponding period last year. The training services provider’s defence-related backlog jumped by 22% to USD3.3bn.
In a conference call with analysts on 8 February, CEO Marc Parent attributed what he called a “mixed” performance to increased activity in CAE’s recently-acquired Alpha-Omega Change Engineering (AOCE) unit and its US Navy Chief of Naval Air Training contract, both of which are in their early stages. (Source: IHS Jane’s)
11 Feb 19. Kromek equity raise worth backing. Sedgefield-based Kromek (KMK:25.5p), a radiation detection technology company focused on the medical, security and nuclear markets, has announced a placing and one-for-65 open offer, at 25p a share, to raise £19.9m net of expenses after it was awarded a massive $58m (£44m) seven-year medical imaging contract. In the past three years, Kromek has won $138m of new contracts and analysts estimate that its current order book exceeds $100m. Kromek moved to a state-of-the-art medical-grade facility in Pittsburgh last year that has the design, engineering and technological capabilities needed to produce commercial quantities of cadmium zinc telluride (CZT) crystals. The move was well timed as demand for the company’s CZT-technology is really taking off in nuclear detection, medical imaging and security screening. The primary reason for the equity raise is to fund the extra capacity required in the medical imaging business.
That’s because Kromek has developed a range of CZT-based detectors for use by original equipment manufacturers (OEMs) in CT scanners. These detect photons emitted from radio-pharmaceuticals injected into patients which concentrate at sites for identification of diseases including: cancer, Alzheimer’s, Parkinson’s, dementia and osteoporosis. CZT-based detectors are smaller and are lighter than scintillator detectors, and have higher resolution, superior specificity and lower scan time, resulting in improved and earlier diagnoses, better patient outcomes and a reduced cost of healthcare. Kromek’s chief executive, Arnab Basu, believes that CZT-based detectors are set to replace the prevalent scintillator-based detectors, a view given credibility by the massive seven-year contract Kromek has just been awarded. He also believes the market here is worth $100m a year.
Furthermore, as one of only four companies that can manufacture and supply CZT worldwide, Kromek is ideally placed to win further contracts as more of its customers commercially adopt and launch next-generation CZT-based products. So, in anticipation of winning further major contracts, the directors want to increase Kromek’s medical imaging production capacity further and have earmarked £10m of the equity raise for capital expenditure in expanding facilities in this operation. Dr Basu says this will give Kromek critical mass in production. He also reassures investors that the incremental capital expenditure requirement of servicing another huge contract win can be funded through internal cash flow and, more importantly, as the business expands the company will not need to return to shareholders for the incremental working capital and capital expenditure requirements these contracts will create. Moreover, during our lengthy conference call, finance director Derek Bulmer said that £5m-£7m of the company’s current working capital position will normalise and unwind by April 2020.
Sales and marketing efforts to ramp up
Kromek’s nuclear division’s flagship product, the D3S ‘dirty bomb detector’, is gaining contract momentum too. This is a portable, nuclear detection device used by counter-terrorist agencies to protect civilians and key infrastructure in cities, including ports, borders and transport hubs. The product is 10 times faster at detecting gamma and neutron radiation, and at a tenth of the cost of conventional detectors.
It’s proving popular, as Kromek has delivered more than 10,000 D3S units as a sole supplier to an agency of the US Department of Defence under its SIGMA programme. The product is being deployed and field tested by US government agencies in North America and by a number of customers in Europe and Asia. Kromek is also working with the US government to develop a ruggedised dirty bomb detector for use by the US military. Dr Basu believes the market in nuclear detection is also worth in excess of $100m a year.
So, to capitalise on the increasing traction that the D3S product is experiencing, Kromek plans to invest £3m-£4m to expand its sales and marketing capability. Of this sum, about £500,000 will be spent in the 2019-20 financial year. It’s worth noting that this business has significant capacity to scale up production without additional capital requirement.
The £6m balance of the equity raise proceeds will be used to strengthen Kromek’s balance sheet and target new contracts as they emerge.
Balancing risk and reward
Clearly, there is execution risk, but given the directors say that the “pipeline of new opportunities is extremely robust”, then the decision to invest extra capital in facilities, and have a cash buffer to target new contracts, is sensible. It also allays concerns over the company’s cash position as prior to the equity raise analysts had forecast Kromek to end the financial year to end April 2019 with net funds of £2.7m, down from £6.5m a year earlier. These figures exclude the operating liability on the lease on the Pittsburgh facility.
The important point being that with the benefit of the $58m OEM contract, expectations that Kromek can lift revenues from £15m to £18.5m in the 2019-20 financial year have been de-risked, and help support a near-doubling in Kromek’s cash profits to £3m as analysts predict. Furthermore, if the flow of contract wins continues to gain traction, then expect revenues and profits to ramp up sharply as the operational gearing of the business really kicks in.
To put the current valuation into perspective, based on an enlarged share capital of 374.5m shares post the placing and open offer, Kromek has a market value of £95m, or 1.6 times pro-forma net asset value (NAV) and 2.3 times tangible NAV. Its enterprise value of £71m equates to 24 times cash profit estimates for the 2019-20 financial year. However, earnings multiples will drop sharply if the company continues to win contracts at the current rate, and moves into operating profitability.
True, the shares are back at the 25p level at which I initiated coverage (‘Follow the smart money’, 27 February 2017), and retail investors will be dismayed that only £1m of the equity raise is through the open offer, so institutional investors now have more of the economic interest in the company. I personally feel that a placing price north of 30p a share would have been appropriate too. However, that issue aside, the investment case for Kromek is even stronger now than two years ago when I first recommended the shares as the commercialisation of the company’s technology is clearly gaining traction and is highly supportive of acceleration in Kromek’s profits in the coming years. In the circumstances, I would advise taking up the open offer and continue to rate the shares a buy. (Source: Investors Chronicle)
12 Feb 19. HAL posted profit of Rs 7,334 crore from 2015-16 to Sept 2018. Hindustan Aeronautical Limited (HAL), the defence PSU, has registered a profit of Rs 7,334 crore since 2015-16 to September 2018, the government said Monday. In a written response to a question in the Rajya Sabha, Subhash Bhamre, Minister of State in the Defence Ministry, said the HAL posted a profit of Rs 1,998 crore in 2015-16, Rs 2,616 crore in 2016-17, Rs 2,070 in 2017-18 and Rs 650 crore until September 2018.This assumes significance as the aerospace major had taken an overdraft from the bank for paying its employees.Bhamre said the government has made significant investments to boost capacity of the HAL in the last three years.
This includes sanctioning Rs 450 crore for establishment of major servicing facility for Hawk-132 aircraft, Rs 205 crore for Repair and Overhaul (RoH) Facility for Adour Mk 871-07 engines, Rs 1,381 crore for ramping up of manufacturing facility of Light Combat Aircraft (LCA) Tejas from existing eight to 16 aircraft per annum, he said.
Funds were also sanctioned for establishment of RoH capacity of Su-30 MKI and establishing of RoH facility for three Line Replaceable Units (LRUs) of Adour Mk 871-07 engines fitted on Hawk Mk 132 aircraft, he added.In response to another question, Bhamre said to fast track the delivery of LCA Tejas, the HAL is ramping up production capacity from existing eight aircraft to 16 aircraft per annum, establishing second line for structural and equipping activities at Aircraft Division of the company, increased the number of jigs for Front Fuselage, Centre Fuselage, Rear Fuselage, Wings and various sub-assemblies and established contracts for outsourcing to private partners and reduction in manufacturing cycle time through improved supply chain management, learning and augmentation of manpower.
Replying to another question, he said twenty-one defence offset contracts with cumulative value of approximately USD 5.67bn have been signed by the Ministry of Defence (MOD) in the last three years. (Source: Google/https://www.dnaindia.com)
11 Feb 19. Arlington Capital Partners Agrees to Sell Endeavor Robotics to FLIR Systems, Inc. for $385m. Arlington Capital Partners (“Arlington Capital”), a Washington, DC-based private equity firm, today announced it has agreed to sell Endeavor Robotics (“Endeavor”) to FLIR Systems, Inc. (NASDAQ:FLIR) for $385m. Formerly known as iRobot Defense & Security, Endeavor Robotics was carved out by Arlington Capital in 2016 and has since become the leading independent provider of ground-based robotic systems to the United States Department of Defense, allied militaries, and industrial and utility customers worldwide. Endeavor is headquartered in Chelmsford, Massachusetts and has delivered over 7,000 systems to customers in over 55 countries.
Peter Manos, a Managing Partner at Arlington Capital, said, “Through significant investments in technology and people, Endeavor has achieved over 100% organic growth during our ownership and solidified its role as the technological leader in robotics for the U.S. military. Endeavor provides the broadest robotics offering to its customers which will be complemented by FLIR’s world class unmanned aerial systems, sensor and payload capabilities.”
“Through a combination of growth investments from Arlington Capital and an extremely committed employee base, Endeavor has built an enduring market position that will accrue to FLIR’s benefit in the coming years,” said Sean Bielat, CEO of Endeavor. “We are not only grateful to our customers who have entrusted their missions to us, but also to our employees who believed in and contributed to the Endeavor vision.”
Tom Frost, President of Endeavor, said, “In just the last three years, Endeavor introduced two new robotic systems to the market, was selected for three programs of record, and fostered a culture of innovation that meshes well with FLIR’s approach to technology development. Moving forward, we are excited to join forces with our new partners and collaborate on each of our strategic objectives in the unmanned systems market.”
Ben Ramundo, a Vice President at Arlington Capital, said, “Endeavor’s achievements have been nothing short of tremendous and have positioned the company for continued success in the rapidly-growing market for unmanned ground vehicles. The company’s momentum and best-in-class management team will serve as a key growth engine within FLIR’s broader strategy for autonomous and intelligent sensing technologies.” (Source: BUSINESS WIRE)
11 Feb 19. Lohia Group enters Aerospace and Defence sector with acquisition of Israel-based Light and Strong Limited. The acquisition establishes Lohia Group as a key participant in the sector as it leverages Light and Strong’s existing client base, which includes the Israeli Ministry of Defence among others. The Lohia Group marked its entry into the Aerospace and Defence sector with the acquisition of Israel-based Light and Strong Limited. Specializing in aerospace and military carbon fibre and glass fibre composite components production, the firm’s established pedigree in military technology manufacturing is a synergistic fit with Lohia Group’s decades long expertise in large scale manufacturing across sectors.
The acquisition establishes Lohia Group as a key participant in the sector as it leverages Light and Strong’s existing client base, which includes the Israeli Ministry of Defence among others, to build its own presence. The Israeli facility is a well-established aerostructures manufacturer for platforms such as Unmanned Aerial Vehicles (UAVs) and passenger and cargo aircraft. These customers will now be ably supported by Lohia Group with its facilities in Israel and India.
Based in Kanpur, Lohia Group’s India facilities will be part of the Uttar Pradesh government’s new defence corridor, bringing in high-end key technologies into Aerospace and Defence composites domain. Working with the overarching vision of the Government of India’s ‘Skill India’ and ‘Make in India’ initiatives, with this acquisition, Lohia Group will establish India as an exporter of customized composite products to global OEMs.
We aim to become a successful vehicle for executing offset obligations of global companies through this endeavor. The Group will also explore other opportunities in the sector which align with our experience and expertise.
Anurag Lohia, Director – Lohia Group, stated, “Our acquisition of Light and Strong allows us to integrate our manufacturing expertise with cutting edge technology to help make India the exporter of choice for global OEMs. With our belief in ‘Make in India’, we are committed to supporting our indigenous Aerospace and Defence sector for its requirements of all things composite.” This story is provided by NewsVoir. (Source: Google/https://www.timesnownews.com
11 Feb 19. Natural Power Acquires Ascent Technologies. Renewable energy consultancy and service provider, Natural Power, has acquired the Texas-based firm Ascent Technologies – a developer of software for commercial unmanned aerial systems (UAS) operations. The specialist software, which has been developed by Ascent Technologies during the course of the past two years, will enable Natural Power to automate drone flights, thus increasing speed, consistency and quality of the data gathered during wind turbine blade inspections.
The automation enabled by this new software means that the drone system calculates and manages the optimal flight along the surfaces of the blades without pilot intervention, as well as constantly monitoring, adjusting and optimising camera angles, exposure, focal distance and timing of the image acquisition. This ensures excellent data quality capture during the inspection process, whilst also enabling a much quicker inspection process that reduces the turbine’s downtime and associated loss of revenue. The cost to undertake the inspections are lowered and the images obtained during the process are of consistently high quality.
Craig Gordon, Global Head of Inspections at Natural Power, said:
“Our blade inspections business continues to gather pace and we have invested in a number of drones that will complement our existing blade inspection services. The acquisition of Ascent will enable us to deliver a step change in the wider inspections service that we offer to clients, and coupled with our expert analysis, ensures we deliver a consistently high quality service.”
Stephen Trotter, Managing Director at Natural Power commented: “We continue to invest in key technologies and skills to deliver improved quality and value to our customers. The acquisition of Ascent accelerates this for our inspections business which plays a key role both as a standalone service and as a complement to our analytics, due diligence, operational and asset management services.”
Natural Power is recognised across the renewables sector for its proven track record across the full scope of inspection services, and has worked across various turbine types including, but not limited to, Siemens, Vestas, Senvion, GE, Enercon and Nordex. This has included work in Europe and The Americas. The team uniquely understands the need to achieve best quality data, combined with efficiency in order to maximise the uptime of turbine fleets whilst verifying their condition and integrity. (Source: UAS VISION)