Ann: Appendix 4C - quarterly, page-4

A market cap of 258 million and 100+ million cash in 2020.....

https://www.livewiremarkets.com/wires/the-new-criterion-the-real-defensive-stocks

The New Criterion: the real defensive stocksElectro Optic Systems (EOS) $2.83

The hitherto obscure entity is best known for its facility that tracks objects in space, notably harmful debris, for both defence and commercial applications.

But Electro Optic Systems is fast emerging from under the radar in a different capacity: manufacturing a range of remote controlled weapons systems with improved “lethality” to ensure that friendly forces can outgun the enemy.

Crucially, the soldiers can operate the guns while safely bunkered in the vehicle.

Unlike most of its ASX tech peers, EOS is starting to make serious money.

In August EOS won a pivotal contract to equip remote weapons systems for the second phase of the Land 400 program, which involves the army procuring 211 armoured combat reconnaissance vehicles.

The top brass have also specified the EOS systems for phase three of the Land 400 program, which involves the army buying 450 infantry fighting vehicles by 2024.

The win was a prestigious one, but in reality 95 percent of EOS’s output is exported. With the hardware denominated in $US, EOS has no problem with the falling Aussie dollar relative to the greenback.

EOS reported $620m from committed contracts at end of first (March) quarter, growing to $800m by the end of the September quarter. Management expects sales of $900m by the end of the calendar year.

Revenue wise, the company expects to turn over close to $100m by the end of 2018, rising to 180m next year and $275m by 2020.

Profit wise, EOS expects to post $10m this year, having recorded a $5m surplus in the first half. Based on the contracts in hand, management is confident enough to forecast $20m next year and $27m by 2020.

The company currently has $58m in cash and will not need to raise funds unless new orders are receivedBased at the company’s $30m tracking facility at Learmonth in WA, the space tracking side is expected to become profitable in the first half.