Electro Optic Systems Holdings Limited (ASX:EOS) presented an optimistic third quarter update for 2024, showing recent contract wins, strong cash inflow and significant progress in the manufacturing sector.
Headquartered in Canberra, EOS operates primarily in the defence, space and communications sectors, focusing on high-tech solutions for government and military customers globally. The company is known for its advanced weapons systems, anti-drone technology, satellite laser tracking and communications solutions.
EOS’ defense division has reported robust production and delivery of its Remote Weapon Systems (RWS) for customers in the Middle East, including vehicle-mounted systems. The Slinger Counter Drone system, a recent addition to EOS’ defense portfolio, has been delivered to a major German customer. The system incorporates a 30mm cannon equipped with specialized ammunition and a radar, allowing it to track and neutralize drone threats at ranges greater than 800m. Furthermore, a new order from a Middle Eastern customer strengthens EOS’s presence in the global defense market. EOS is also actively pursuing a major contract for the Australian Land 400 Phase 3 project, potentially worth $100 million, and is in negotiations for an R800 RWS contract with a North American customer, estimated at $30 million.
In the space sector, EOS secured a $9 million contract with a domestic customer, focused on satellite laser tracking. This technology, one of EOS’ core products, enables accurate tracking of satellites and debris, which is essential for space traffic management. EOS’ space division also oversees EM Solutions, which recently added $15 million in European orders for its satellite communications solutions.
Financially, EOS reported an operating cash inflow of $10.5 million, attributed to customer revenue totaling $76.5 million. The company’s liquidity grew to $55 million, supplemented by $64.2 million in bank deposits backing contractual guarantees. EOS also reduced its contract asset balance by $10.6 million, marking progress in Middle East defense contract invoicing.
The shares are trading up 5.42% at $1.46.