18 Jun 20. Kromek Group aims to make progress across all three divisions.
- Developer and supplier of radiation detection products
- Sells to medical, security screening and nuclear markets
- Operates in UK and US with international distribution network
What Kromek does
Kromek Group PLC (LON:KMK) is a developer and supplier of radiation detection products for the medical, security screening and nuclear markets.
The company’s products are based on cadmium zinc telluride (CZT), an alloy used primarily for x-ray and gamma radiation detection, as well as other technologies.
The group has operations in the UK and the US and sells its products internationally through a network of distributors, original equipment manufacturers (OEMs) and direct sales.
How is it doing
In late May, the company was awarded an extension to its contract with the Defense Advanced Research Projects Agency (DARPA) to detect and identify pathogens in an urban environment.
Under the new deal, Kromek said it will be awarded up to US$5.2mln to further work on its mobile wide-area bio-surveillance system capable of detecting airborne pathogens.
In a full-year trading update at the start of the month, the firm said it had started the second half of its current financial year with “increasing commercial momentum” and had not experienced any material impact from the coronavirus pandemic until the end of February.
As a result, the firm said it now expects to report full-year revenues of £14.5mln, similar to the prior year, while adjusted underlying earnings (EBITDA) are predicted to be breakeven.
Kromek is also helping in the effort to combat coronavirus by turning its manufacturing efforts over to producing medical ventilators, which will be made under licence machinery developed by the Japanese firm Metran.
The company said it has received “significant interest” in the ventilators and is on track to produce at least 2,000 units by the end of July.
What the boss says: Arnab Basu, chief executive
Speaking on the ventilator manufacutring deal, the CEO said: “By combining our existing manufacturing skills with Metran’s proven technology, we expect to commence the manufacture of these robust ventilators from next week and deliver in a rapid manner,” he added.
“Any procurement of this equipment from Kromek is expected to have the additional benefit of safeguarding and creating employment in the North East as well as contributing to this region’s fight against COVID-19. We look forward to the ongoing relationship with Metran.”
- Additional orders in all three divisions
- Airport safety standards tightening around the world
- New opportunities in biological detection
- The company has new manufacturing plants in the US and UK
16 Jun 20. Kratos to Acquire Satellite Antenna Manufacturer ASC Signal for $35m.
- Broadens Kratos’ Solutions Across the Space Ground Segment and Brings Market-Leading Products to Anchor Kratos’ Existing Antenna Systems Solutions
- High-Performance Products and Manufacturing Capability Will Enable Kratos to Expand its Support for U.S. Defense Missions
Kratos Defense & Security Solutions, Inc. (Nasdaq: KTOS), a leading National Security Solutions provider, announced today that it will acquire CPI ASC Signal Division, Inc. (ASC) from Communications & Power Industries LLC (CPI) for $35m in cash. ASC is a manufacturer of high-performance, highly engineered antenna systems for satellite communications, radar, electronic warfare (EW), and high-frequency (HF) applications. The transaction is expected to close within the next 60 days, subject to normal and customary closing conditions and regulatory approvals.
The products, business and North American manufacturing operations that Kratos is acquiring bring 60 years of innovation in high performance antenna products used in a variety of mission-critical space applications ranging from Telemetry, Tracking & Command (TT&C) to Satellite Communications and Earth Sensing & Observation for military and commercial satellites in low (LEO), medium (MEO) and geostationary (GEO) orbits. With an expanded portfolio that now includes transportable and fixed earth station antennas ranging from 2.4-meter to 18-meter in diameter, radar antennas for air traffic control and weather applications, and lines of High-Frequency (HF) and specialty antennas, Kratos is well positioned to meet the current and future needs of the combined Kratos and ASC customer base.
Earth station antennas are in high and growing demand, especially as satellite capacity increases with the launch of more and more High-Throughput Satellites (HTS) and small satellite mega-constellations that require a substantial ground infrastructure to operate. In particular, they are a critical part of government strategic and tactical missions, especially for defense and intelligence operations, and are also used widely in the commercial world.
The acquisition brings numerous synergies to Kratos’ core space business. To date, the part of Kratos focused on antennas has specialized in planning and implementing full-scale large, complex systems for which the antennas are just a part, and often employing antennas from multiple manufacturers. The ASC antennas will help expand that business, especially among U.S. government and national security customers, while Kratos’ global reach and broad product portfolio will complement ASC’s solutions. Kratos’ space business offers a wide variety of products and solutions across the satellite ground segment, including RF infrastructure, systems management and mission assurance products that will bring system synergies to an expanded antenna offering and to ASC’s existing customers.
“The addition of ASC provides an important building block for Kratos’ continued growth as the industry’s broadest supplier of advanced products across the ground segment,” commented Phil Carrai, President of Kratos’ Space, Training and Cybersecurity Division. “Beyond the strong product lines and North American manufacturing base, it brings the ability for us to advance our strategy of building important ground segment technologies directly into antennas and better integrating antennas into increasingly virtualized ground systems. In addition, the acquisition brings engineering expertise and a product platform for growing Kratos’ solutions in the Q and V band markets that will become a critical part of the industry’s future.”
“Kratos has an extremely exciting vision for the future of dynamic ground systems, and we are inspired to become a part of it,” said Tony Russell who led ASC and will run the Antenna/RF operating unit within Kratos. “Together, our united teams can accelerate that vision, and Kratos’ global reach and space infrastructure expertise will help our combined customer base better achieve their missions in this rapidly evolving industry.” (Source: ASD Network)
11 Jun 20. Serco soars as guidance restored. Serco’s (SRP) shares leapt by as much as 17 per cent after the outsourcer revealed it expects a strong performance in the six months to 30 June. Revenue is guided to rise by almost a quarter year-on-year to £1.8bn, reflecting the contribution of the Naval Systems Business Unit acquired from Alion last August, as well as 14 per cent organic growth. Meanwhile, underlying trading profit for the first half is set to come in at £75m-80m, up from £51m a year earlier.
While the group has experienced “significant operational challenges” thanks to Covid-19, it says this has had “little overall impact” on its profits in the first half. That’s not to say it has been unscathed, rather that losses in areas such as leisure and transport have been offset by additional work assisting in the pandemic response. For example, Serco is operating 20 drive-through test centres as part of the NHS’ ‘Test and Trace’ programme. Such work is lower margin, however, and according to Liberum, the group has seen £100m of Covid-19-related revenue so far.
Net debt (excluding lease liabilities) is projected to be around £200m at the end of June, benefitting from £50m of tax deferrals. Equivalent to 1 times cash profits (Ebitda), this is well below its lending covenant of 3.5 times. With at least £300m of headroom on its borrowing facilities, Serco should have sufficient liquidity to weather the Covid-19 storm.
Pandemic uncertainty had led the group to withdraw its full year guidance in early April. But it has now been reinstated and the outlook upgraded. Chief executive Rupert Soames cautioned that “there is a more than normal degree of risk in our guidance, but we feel it better that we give some indication rather than none”. The group is pointing to 9 per cent organic revenue growth, up from its previously forecasted 4 per cent. Expectations for full year underlying trading profit have also been revised from £145m to between £135m-150m.
It’s hard to disagree with Liberum’s assessment that “Serco is having a good crisis”. The unscheduled update further feeds the narrative that the group’s recovery efforts are paying off. We said at the time of full year results in February that Serco might be worth a speculative punt, and our view remains unchanged. Buy. Last IC View: Buy, 155p, 26 Feb 2020. (Source: Investors Chronicle)
16 Jun 20. CAE’s defence and security group president Todd Probert is departing the Quebec-based training and simulation firm after five months to take a job elsewhere, and CAE’s Heidi Wood will serve in the interim.
Todd Probert, a former Raytheon executive, will step down June 26 to pursue an unspecified job opportunity within the U.S. national security community, CAE announced Tuesday. The move comes as the coronavirus pandemic has blunted projections for a strong year in CAE’s defense segment.
Wood, who recently joined CAE as executive vice president for business development and growth initiatives, will act as interim leader while the firm searches for Probert’s replacement, CAE President and CEO Marc Parent said in a statement.
“Todd’s first passion is for the U.S. National Security community and he has decided to step down from his role at CAE to pursue a job opportunity in that domain. We wish him success in his new role,” Parent said, adding: “Our Defence business is comprised of an excellent global team and we will continue supporting our customers with the most innovative training and mission solutions.”
In a previous role, Wood served as senior vice president of corporate strategy and technology at L3 Technologies, where she led its merger with Harris Corporation, resulting in it becoming the sixth largest defense prime in the U.S.
Probert, who recently led the Command, Control, Space & Intelligence business unit as part of Raytheon’s Intelligence, Information and Services segment, succeeded Gene Colabatistto, who retired from CAE in December 2019.
CAE is one of many defense and aerospace firms whose businesses have been hit by the pandemic-related slowdown in air travel.
On a March 31 earnings call, Parent said Probert was the process of “bolstering operational efficiencies and effectiveness in expanding its addressable market” as the company expected the pandemic to complicate efforts to reach certain program milestones. CAE was working with defense customers to secure more favorable terms for milestone payments, offering contract modifications to increase work scope and working with suppliers for extended payment terms.
“A range of programs with defense and OEM customers globally saw project advancement delays due to travel bans, client access restrictions and supply chain restrictions ― and disruptions,” Parent said. “Also, we had delays to contract awards, as government acquisition authorities followed directives in their respective countries to shelter-in-place and eliminate travel.” (Source: Defense News)
16 Jun 20. NorthStar Announces Acquisition of Heneghan Wrecking Company.
NorthStar Group Services, Inc. (“NorthStar”), a portfolio company of investment affiliates of J.F. Lehman & Company (“JFLCO”), announced today the completion of the acquisition of Heneghan Wrecking & Excavating Co., Inc. and Patrick’s Equipment Leasing, Inc. (collectively “Heneghan” or the “Company”).
Headquartered in Chicago, Illinois, Heneghan is a leading provider of complete structural and interior deconstruction, excavation and emergency response services for commercial and industrial clients across the Midwest. Since 1973, Heneghan has established an extensive track record and unparalleled reputation as the preeminent deconstruction provider in the Midwest. Heneghan represents the first add-on acquisition completed by NorthStar under JFLCO’s sponsorship. Patrick Heneghan, former President of the Company, will remain with NorthStar and lead the combined Chicago and Midwest operations.
NorthStar is the leading provider of highly technical infrastructure and environmental services with unrivalled credentials executing highly complex projects across its core end-markets. NorthStar’s complementary service lines include commercial and industrial deconstruction, nuclear deconstruction and decommissioning, environmental services, and response and restoration. NorthStar is headquartered in New York, New York with a broad branch network across the United States.
Scott State, Chief Executive Officer of NorthStar, commented, “Our partnership with Heneghan will further strengthen and broaden both organizations’ market presence and penetration, customer relationships and service capabilities. We look forward to working with Patrick and his team to build upon Heneghan’s sterling reputation and drive continued growth at NorthStar.”
“The Heneghan acquisition unlocks a key market in Chicago and customer base that NorthStar has historically had limited access to,” said Alex Harman, Chairman of NorthStar and Partner at JFLCO. “We are excited to welcome Heneghan and its strong Midwest presence, as well as its complimentary service offerings and capabilities to the NorthStar platform,” added Glenn Shor, Director of NorthStar and Partner at JFLCO.
Jones Day served as legal advisor to NorthStar and JFLCO. Chartwell Financial Advisory served as financial advisor to Heneghan while Katten Muchin Rosenman were Heneghan’s legal representatives for the transaction.
15 Jun 20. IAI to Acquire Bluebird for $29m. Israel Aerospace Industries (IAI) is in advanced negotiations to acquire Israeli drone manufacturer Bluebird Aero Systems Ltd. at a valuation of NIS 100m (approximately $29m), according to people with knowledge of the deal who spoke to Calcalist under the condition of anonymity.
Founded in 2002 by CEO Ronen Nadir, Bluebird specializes in making relatively small unmanned aerial vehicles suitable for a range of missions, including a model that can take off and land vertically, without the need for a runway. Nadir holds 20% of the shares in the company. Other prominent shareholders include India-based companies Cyient Ltd. and the Puranas Group. The company employs about 70 people.
The development and production of unmanned planes have been one of the flagship activities of IAI since the 1980s. However, when it comes to smaller drones, IAI falls behind its competitors Elbit Systems Ltd. and Aeronautics Ltd., which was purchased last year by defense contractor Rafael Advanced Defense Systems Ltd. and Israeli businessman Avihai Stolero for NIS 850m (approximately $250m).
The Indian military is one of Bluebird’s most prominent clients, alongside the Israel Defense Forces. Last year Bluebird signed a contract worth tens of millions of dollars with an undisclosed European country for the purchase of 150 multi-purpose drones. The company’s aircrafts have been sold in the past to Greece, Mexico, Chile, and Spain in some of the cases to equip civilian government agencies with tools for agriculture and drug enforcement. (Source: UAS VISION/CTECH)
13 Jun 20. Intelsat Gets OK for a $1bn Loan. SpaceX to Concentrate on Starship. Intelsat is in Chapter 11 bankruptcy and is restructuring itself. On June 9th, it gained bankruptcy court approval to access a $1bn loan under ‘debtor in possession’ rules and post-petition financing, as is being reported by journalist Chris Forrester at the Advanced Television infosite.
Judge Keith Phillips granted Intelsat immediate access to $500m (out of the $1bn) in order to keep its day-to-day operations going (working capital). Approval also came for Intelsat’s C-band frequency clearing and relocation scheme. The $1 bn borrowing will be handled by Intelsat Jackson, one of the operator’s sister businesses. The cash comes from Credit Suisse (via its Cayman Islands branch).
Intelsat entered Chapter 11 on May 13th and is being ‘fast tracked’ for reconstruction. Intelsat is looking to cut its significant debts and financial borrowings by about half. It is also proceeding with the C-band clearances required by the FCC and thus qualify for some $5bn in incentive payments from the FCC.
The court’s final hearing into the bankruptcy is set for June 30th.
Also posted at the Advanced Television infosite — Elon Musk’s SpaceX is normally focused on launching satellites into orbit, plus a couple of astronauts now and again. But now he is targeting his all-new ‘Starship’ super-rocket, and flights carrying up to 100 people.
Musk’s Starship is the vehicle which he wants to use to get missions to the Moon, and eventually Mars. He says getting the craft ready is now the “top SpaceX priority” and that staff needed to accelerate progress dramatically and immediately.
“Please consider the top SpaceX priority (apart from anything that could reduce Dragon return risk) to be Starship,” Musk wrote in the email to staff.
Up until now, SpaceX has used its core Falcon 9 rocket in ever-more powerful ‘Super Heavy’ versions and to date there have been some 85 missions, with most of their booster stages re-landing after launch either onto firm ground or one of Musk’s floating barges.
However, Musk’s plan is to use the giant Starship (aka the ‘Big Falcon Rocket’ or BFR) on a totally reusable basis and landing and refueling in the same way that an aircraft is used.
However, there are problems. Of the four prototypes built so far, each has had a somewhat catastrophic and often explosive end. None have flown. Each version has performed better than the previous iteration, but – as with a May 29th engine test – ended up as a fireball.
To date, Musk’s team of 8,000 engineers have been focused on launching batches of 60 ‘Starlink’ broadband satellites, or the Crew Dragon capsule which took two astronauts to the International Space Station a few days ago. Now that those tasks are more routine, Musk is switching much of SpaceX’s focus to his South-east Texas facility of Boca Chica, on the edge of the Gulf of Mexico, where the Starship is being developed.
Starship Version 5 is now being prepared, although Starship 6 and 7 are also under construction.
Will there be further setbacks? Probably, but Musk’s record in achieving his goals is superb. (Source: Satnews)
07 Jun 20. General Atomics Electromagnetic Systems Partners with the Space Development Agency. General Atomics Electromagnetic Systems (GA-EMS) announced the company has partnered with the U.S. Space Development Agency (SDA) to demonstrate and conduct a series of experiments for an Optical Intersatellite Link (OISL) using GA-EMS’s internally developed 1550nm (nanometer) wavelength laser communication terminals (LCTs).
This will be one of the first Department of Defense contracted efforts to develop and deploy a state-of-the-art 1550nm LCT to test capabilities to increase the speed, distance, and variability of communications in space.
The OISL demonstration will consist of two GA-EMS internally designed and built 12U CubeSat spacecraft, each of which will host an Infrared payload (IRPL) and LCT payload, with an anticipated launch date in March 2021. Satellite development, integration and testing is being conducted at GA-EMS facilities in San Diego, California, and Huntsville, Alabana. GA-EMS will also provide mission control capabilities from its mission control centers in Centennial, Colorado, and Huntsville.
Scott Forney, President of GA-EMS, said this is an exciting opportunity for GA-EMS to leverage work currently underway to advance OISL technologies. For several years, the company has been developing a series of optical laser communication terminals to improve and increase satellite crosslink data transfer rates and downlink data rates. These experiments will demonstrate robust communication capabilities through multiple mediums, from Earth, to and between satellites in multiple orbits and on into deep space. GA-EMS’ LCT technology will modernize and enhance space communications permitting faster communication transmission across longer distances and with greater fidelity.
Nick Bucci, VP of Missile Defense and Space Systems at GA-EMS, added that the company’s small satellite designs offer unique solutions to many of the challenges that arise when developing demonstration assets, such as LCTs including addressing specific size, weight, and power requirements. With GA-EMS’ proven spacecraft and capabilities, coupled with the company’s significant investment in LCT research and development, the firm anticipates this demonstration to show data rates up to 5 GB a second at ranges up to 2500 km, and this LCT can support out to greater than 4500km. This increased speed in communications is necessary to advance a variety of space applications in intelligence, surveillance, telecommunications, reconnaissance, and more. (Source: Satnews)
19 May 20. Charlesbank Capital Partners Invests $70m in Elbit Systems’ Subsidiary, Cyberbit. Elbit Systems Ltd. (NASDAQ: ESLT and TASE: ESLT) (“Elbit Systems”) announced today that Charlesbank Technology Opportunities Fund, a fund managed by Charlesbank Capital Partners (“Charlesbank”), invested approximately $70m in Elbit Systems’ Israeli subsidiary, Cyberbit Ltd. (“Cyberbit”), of which approximately $22m was invested in Cyberbit and approximately $48m was paid in consideration of a portion of Elbit Systems’ shares in Cyberbit. As a result of the investment and sale of equity holdings, Elbit Systems became a minority shareholder in Cyberbit. Claridge Israel L.P., an existing shareholder of Cuberbit, which invested $30m in Cyberbit in June 2018, also participated in this round of investment.
Cyberbit is engaged in commercial training systems for cybersecurity teams.
Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems, commented: “Preparing the human element for cyber-attacks is one of the most acute cybersecurity challenges. The investment of Charlesbank in Cyberbit is a recognition of Cyberbit’s market-leading position and the growth potential of Cyberbit’s training platform – the Cyber Range. I am confident that this investment will allow Cyberbit to realize its full growth potential.” (Source: ASD Network)