What happened today?, page-13

When I first looked at this company, the key was the durable competitive advantage it held in laser tracking, which came out of the CSIRO about 10 plus yrs ago. Basically this is a "patform technology", meaining it can be used across a number of applications.
Over the last 10 years they have reinvested all earnings and spent around $80 mill developing this technology in 2 areas, space debris tracking, and remote weapons systems. The IP allows things to be tracked in space better than any "existing technology in the world". This was confirmed by the US army some years ago. Currently they are building additional telecscopes to enable this data to be commercially sold. Lockheed Martin is paying for it, and need to spend $80 mill to reach a 50/50 jv position. They envisage their is around $50 mill pa in tracking revenue available, once the telescopes are commissioned later this year, and the build out continues. The thing I like about this, is that basically they have no competition in this area, and no costs to incur re the build out.

This IP is the same they use in their "remote weapons division", where soldiers can basically hide in their vehicles, play war games on their computers, and kill people at the same time. Remote weapons are flying into the armed forces, and eos is again leading this area of growth in a number of fields.

The Austalian Government is also now pro Aussie companies re defence, meaning eos is very well placed re the $billions in procurement due over the next few years..

Website www.eos-aus.com