Electro Optic Systems Holdings Limited · ASX:EOS
Electro Optic Systems — FY2024 Earnings Presentation
39 slides from Electro Optic Systems's earnings presentation, Feb 25, 2025
Slide 1: 2024 Full Year Results
2024 Full Year Results Dr. Andreas Schwer, Managing Director & Chief Executive Officer Clive Cuthell, Chief Financial Officer & Chief Operating Officer 25 February 2025 Approved for release by the Board of Directors
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer CONTENT OF PRESENTATION FOR INFORMATION PURPOSES ONLY This presentation has been prepared as at 25 February 2025. Electro Optic Systems Holdings Limited (EOS) published the audited year end 31 December 2024 financial statements on 25 February 2025 and this presentatio
Slide 3: Important Notice and Disclaimer
Important Notice and Disclaimer Presentation of Information All financial information has been prepared in accordance with Australian Accounting Standards. Certain financial data included in this presentation is ‘non IFRS financial information’. The Company believes that this non IFRS financial info
Slide 4: EOS Leadership Team
EOS Leadership Team Today’s presenters include Dr. Andreas Schwer (MD & CEO) and Clive Cuthell (CFO & COO) Dr. Andreas Schwer, MD & CEO • Over 30 years in global Defence, Manufacturing and Space • Previously with Rheinmetall AG, Manitowoc and Airbus • Track record in the Middle East • German citizen
Slide 5: Contents
Contents Summary • 2024 Highlights • Market Conditions • Product Development • Market Development • Contract Backlog Financial Results • Financial Performance • Divisional Performance • Cashflow • Debt and Cash Position Growth Opportunities and Outlook • Strategy • Future Growth Opportunities • Summ
Slide 6: Dr. Andreas Schwer
Dr. Andreas Schwer Managing Director & Chief Executive Officer
Slide 7: 2024 Highlights - Strategic and Operational
2024 Highlights - Strategic and Operational EOS has laid foundations for future growth, particularly Counter-Drone (RWS / High Energy Laser Weapons) and Space Control Focused • Review of strategic growth opportunities Strategy • Decision to focus on high growth opportunities – Counter-Drone and Spac
Slide 8: 2024 Highlights - Financial
2024 Highlights - Financial In 2024 EOS continued to execute on its turnaround program and set the foundation for future growth Total Operations Strong Revenue Revenue $258.7m $39.4m (up 17%) vs. prior year Growth Gross Margin % 46% 2% vs. prior year Underlying EBITDA1 $13.0m $7.3m (up 128%) vs. pri
Slide 9: Market Conditions
Market Conditions Geopolitical uncertainty and rapidly evolving technology continues to create supportive market conditions Geopolitical uncertainty and ongoing regional tensions Rapid technological changes are challenging defence forces 9
Slide 10: Drones and Counter-Drone Warfare
Drones and Counter-Drone Warfare Global demand for counter-drone solutions is growing rapidly • The rise of drones in modern warfare in recent years is well documented – media attention is expected to continue • Low Cost - Drones provide both state and non-state actors the opportunity to disrupt tra
Slide 11: EOS is focused on growing its order book
EOS is focused on growing its order book Growing the order book continues to be our key focus; several opportunities are developing positively Markets Products Sales & Marketing Order Book • Global military spending • Recent launch of the R500, the • Step-change in sales • Contract backlog of $136m
Slide 12: Product Development – Software and AI Opportunity
Product Development – Software and AI Opportunity EOS is focused on advanced software solutions as part of our emphasis on counter-drone opportunities Context • Drone swarms are becoming more numerous and autonomous • There is an urgent need for capable counter-measures • AI is a critical tool to be
Slide 13: Product Development – R500
Product Development – R500 EOS aims to maintain its global product leadership by developing this product in close collaboration with its customers Context • EOS products consistently demonstrate greater accuracy than competitors • We remain committed to being the global product leader • The R500 RWS
Slide 14: Market Development Update – Trade Show Engagement
Market Development Update – Trade Show Engagement EOS continues to invest in trade show presence to ensure we are well positioned in the market EUROPE N. AMERICA OCEANIA MIDDLE EAST Eurosatory AUSA Land Forces IDEX PARIS - Jun 2024 WASHINGTON DC - Oct 2024 MELBOURNE - Sep 2024 ABU DHABI - Feb 2025 •
Slide 15: Market Development Update – Notable Demonstrations
Market Development Update – Notable Demonstrations In 2024 EOS participated in over 20 demonstrations across North America, Europe, the Middle East, Asia/Australia Long Range Counter-Drone Firing Demo US Army Project Convergence Capstone 4 • Demo with the Australian Robotic and Autonomous Systems •
Slide 16: Market Development Update
Market Development Update Growing the order book continues to be our key focus; several opportunities are emerging • Significant investment in sales capability, marketing (trade shows Opportunity Maturity Product Estimated Opportunity Size and demonstrations) is focused on pipeline development R400
Slide 17: Market Development Update - Ukraine
Market Development Update - Ukraine To date, over 190 EOS RWS have been sent to Ukraine. We continue to seek direct sales to Ukraine and donor nations Context Currently over 190 EOS RWS have been sent to Ukraine: • 110 x R400 with Mk19 Automatic Grenade Launchers donated by the Netherlands • 44 x R4
Slide 18: Contract Backlog
Contract Backlog During 2024 EOS continued to lay the groundwork for future order book growth Contract Backlog, $m Impact of EM Solutions divestment 500 441 • EM Solutions’ contracted order book was $171m at 31 Dec 24 450 • This was effectively monetised by the divestment in Jan 25 400 • The funds
Slide 19: Clive Cuthell
Clive Cuthell Chief Financial Officer & Chief Operating Officer
Slide 20: 2024 Financial Performance
2024 Financial Performance In 2024 EOS continued to grow the business and improve profitability Revenue (Continuing & Discontinued), $m $m 300 2024 2023 Var 259 Continuing Operations 250 212 219 Revenue 176.6 162.0 14.6 180 200 Gross Margin %2 48% 45% 3% 138 150 Underlying EBITDA1 (12.9) (13.0) 0.1
Slide 21: Reconciliation of Statutory Profit / (Loss) and non-IFRS measures
Reconciliation of Statutory Profit / (Loss) and non-IFRS measures The results for EM Solutions (divested in January 2025) have been treated as discontinued operations Total Operations (Continuing & Discontinued) 2024 2023 $m Loss for the year (19.7) (34.1) Profit after tax for the year from disconti
Slide 22: 2024 Divisional Performance
2024 Divisional Performance Revenue increased across all the business divisions, contributing to a strong financial performance in 2024 $m - continuing operations 2024 2023 Var Defence Revenue 165.7 155.4 10.3 Systems Underlying Divisional EBITDA1 (incl. corp allocations) (0.7) (0.0) (0.7) • Revenue
Slide 23: 2024 Cashflow - Total Operations (Continuing & Discontinued)
2024 Cashflow - Total Operations (Continuing & Discontinued) Cash Flow in 2024 was impacted by higher manufacturing activity. Operating Cash was used to repay debt and invest in growth Continuing & Discontinued • The 2023 Cashflow includes the benefit of a significant contract amendment 2024 2023 Va
Slide 24: Debt and Cash Position
Debt and Cash Position With a focus on cash and capital discipline, EOS repaid all borrowings on 31 Jan 2025, restoring balance sheet strength Borrowings Borrowings Repayment Repaid by 31 Jan 2025 Repayment Date Amount1 • Debt facilities were originally set up in Sep/Oct 2022 with longstanding $m eq
Slide 25: Dr. Andreas Schwer
Dr. Andreas Schwer Managing Director & Chief Executive Officer
Slide 26: Growth Strategy
Growth Strategy EOS is positioned to grow sustainably in the short, medium and longer terms 1-3 Years 2-5 Years 3-10 Years • Significant organic growth opportunities: DEFEND NURTURE SEED • Remote Weapons Systems (RWS) & GROW • Counter-Drone products (specialised RWS) Space • Two large strategic oppo
Slide 27: Future Strategic Growth Opportunities
Future Strategic Growth Opportunities EOS is developing world-leading innovations with large addressable markets and is developing customer & partner oppportunities High Energy Laser Weapon (HELW) Space Control • There is an urgent market need for • Satellites have become a key defence laser-based d
Slide 28: Summary of Investment Opportunities
Summary of Investment Opportunities EOS is developing has several attractive opportunities to accelerate growth. We will continue to exercise strategic and capital discipline, using customer funding, partnerships and/or investing where appropriate Investment Opportunity Focus $m Timeframe • Artifici
Slide 29: Summary and Outlook
Summary and Outlook EOS aims to become a global leader in Counter-Drone, High Energy Laser Weapons and Space Control Outlook • During 2024, EOS revenue from continuing operations was $176.6m. Achieving a similar revenue in 2025 will depend on the conversion of some of the existing pipeline (or other
Slide 30: Questions
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Slide 31: Appendices
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Slide 32: Remote Weapon Systems Product Range
Remote Weapon Systems Product Range EOS is developing a wider range of RWS products to meet evolving needs Sensor Unit Ultralight RWS Light RWS Medium RWS Heavy RWS Light Turret Multi-Mission R150 R400 R600 R800 T1600 Sensors Common Range of Platforms and Applications Common Control Interfaces MLRS
Slide 33: Effective counter-drone strategies require a layered response
Effective counter-drone strategies require a layered response EOS is developing products that form part of comprehensive, layered, counter-drone systems 0.5km 1km 2km 3km 4km 5km 6km 7km 8km 9km 10km Electronic Warfare (EW) EOS CURRENT FOCUS Remote Weapon System Directed Energy 50-100kW APKWS (Rocke
Slide 34: Market Development Update
Market Development Update Growing the order book continues to be our key focus; several opportunities are developing Emerging Preliminary Evaluation Advanced Notable Opportunities Region Product Size Opportunity • Land 400-3 Project for ADF • Product specification / discussion ongoing with end-users
Slide 35: Market Development Update
Market Development Update Growing the order book continues to be our key focus; several opportunities are developing Emerging Preliminary Evaluation Advanced Notable Opportunities Region Product Size Opportunity • Existing customer, follow-on order Middle East R500 $500m+ • Initial bid submitted, po
Slide 36: Market Development Update
Market Development Update Growing the order book continues to be our key focus; several opportunities are developing Emerging Preliminary Evaluation Advanced Notable Opportunities Region Product Size Opportunity • Opportunity to put RWS on large logistics vehicle fleet Europe R150 $100-$300m+ • Comp
Slide 37: Market Development Update
Market Development Update Growing the order book continues to be our key focus; several initial opportunities are emerging Emerging Preliminary Evaluation Advanced Notable Opportunities Region Product Size Opportunity • Potential new customer nation in western Europe Europe R400 Slinger $10-$50m • E
Slide 38: 2024 Divisional Performance
2024 Divisional Performance The Underlying EBITDA shown by division includes allocated corporate costs $m 2024 2023 Var Revenue Defence Systems 165.7 155.4 10.3 Space Systems 10.8 6.7 4.1 EM Solutions (discontinued) 82.1 57.2 24.9 Total 258.7 219.3 39.4 Underlying Divisional EBITDA Profit/(Loss) (in
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Electro Optic Systems Holdings — FY2024 Earnings Presentation on 6ix