Slide 1: Amended and updated - FY24 Results Presentation (ASX Announcement)
04 September 2024 ASX Announcement Amended and updated - FY24 Results Presentation HighCom Limited (ASX: HCL) (the Company) is commencing a series of investor and broker meetings to present the FY24 results and additional information related to the HighCom Armor sales trends and revenue by Product C
Slide 2: FY24 Results Presentation
FY24 Results Presentation 4 September 2024 For Investor and Broker meetings For personal use only
Slide 3: Disclaimer
Disclaimer This presentation is given on behalf of HighCom Limited (HighCom) For personal use only Information in this presentation is for general information purposes only, and is not an offer or invitation for subscriptions, purchase of recommendation of securities in HighCom. Certain statements i
Slide 4: Agenda
Agenda • Res ults and ov erv iew For personal use only • FY24 financial performance • Review of HighCom Armor • Review of HighCom Technology • Strategic Priorities (short to medium term) • Conclusion • Q&A
Slide 5: Today's Presenters
Today’s Presenters For personal use only Ben Harrison Jacqui Myers Todd Ashurst Chairman of the Board Group CFO Group COO and GM of Technology Mr Harrison has 15 years of experience in advising and investing Jacqui has a proven track record of success in providing advice Todd Ashurst, DSM, GAICD joi
Slide 6: Key Snapshot for FY24
Key Snapshot for FY24 • Rev enue for the F Y24 $45.3m (down 49% on pc p ) with EBIT DA at – v e $9.6m ( -v e $3.7m after adjus ting for one -off impairments in H1) For personal use only • Story of two halves, the wide rev iew to improv e profitability continues, with a pleasing H2 FY24 EBITDA result
Slide 7: State of Play - Update
State of Play - Update Issue Strategy Progress Need for greater • Flattened out structure and streamline management reporting to board visibility • UPDATE - CFO and COO reporting to chair For personal use only Cash management • Greater control over discretionary spend from non -revenue generating ac
Slide 8: Corporate Snapshot
Corporate Snapshot For personal use only Capital Structure (3 September 24) Cash Balance & Borrowings (30 June 24) 102,370,650 Cash Balance A$6.2m Shares Outstanding Borrowings A$0.0m. $3.8m 1 2 Month Share Price Range A$0.12 – A$0.45 overdraft facilities available HIGHCOM LTD | INVESTOR PRESENTATIO
Slide 9: FY24 Results – Key Highlights
FY24 Results – Key Highlights 60.0 Revenue (A$m) 60% 52% Divisional Revenue Attribution (A$m) 51% 50.0 50% $60.0 For personal use only $52.7 $48.5 $46.7 $50.0 $47.0 40.0 40% $40.9 34% 31% $40.0 $36.7 27% 30.0 26% 30% $31.8 $30.4 22% 22% $30.0 20.0 20% $20.0 $16.1 $12.1 $13.6 $11.1 $15.9 $14.9 $10.0
Slide 10: FY24 Results – Key Highlights
FY24 Results – Key Highlights For personal use only HIGHCOM LTD | INVESTOR PRESENTATION 9
Slide 11: Group Overview
Group Overview Highcom Group is comprised of two distinct businesses – HighCom Armor & HighCom Technology For personal use only HighCom Armor HighCom Technology Designs, manufactures, and supplies global military, law Supplies and supports uncrewed systems, control systems, and enforcement, and firs
Slide 12: HighCom Armor – Overview
HighCom Armor – Overview • Locations: • Global Manufacturing, R&D, US Sales & Distribution Centre – Columbus, OH, USA • APAC Sales – Canberra, ACT, Australia For personal use only • Designs, manufactures, and supplies global military, law enforcement, and first responder customers with world - class
Slide 13: HighCom Armor – Update
HighCom Armor – Update • During the reporting period, HighCom Armor successfully implemented its “go to market” business model progressively building a partner network, focused on the domestic US and international law enforcement and military customers. For personal use only • The Board’s decision t
Slide 14: HighCom Armor – Revenue Growth
HighCom Armor – Revenue Growth Revenue excluding FY22/23 $33.2m order Revenue With FY22/23 international order $30.0 (US$m) $40.0 (US$m) $35.5 For personal use only $30.0 $30.0 $19.5 $20.0 $19.5 $13.3 $20.0 $10.9 $10.5 $10.0 $8.4 $11.0 $10.0 $8.4 - - FY20 FY21 FY22 FY23 FY24 FY20 FY21 FY22 FY23 FY24
Slide 15: HighCom Armor – Product Categories
HighCom Armor – Product Categories • Hard Armour the main category Product Revenue Attribution (US$m) • New product development for current manufacturing methods ongoing. For personal use only $1.4 • New XTclave products in design phase. $0.4 $1.0 • Helmets 2 nd highest seller by category • Growth f
Slide 16: HighCom Armor – Inventory Management
HighCom Armor – Inventory Management Inventory Attribution (%) For personal use only H2FY24 55% 45% • While progress has been made in reducing inventory levels they remain above target. H1FY24 52% 48% H2FY23 50% 50% • Current inventory has a reduction in finished goods. 0% 20% 40% 60% 80% 100% Raw M
Slide 17: Revenue Reconciliation and Forward Order Book
Revenue Reconciliation and Forward Order Book For personal use only Summary of Deals - Armor Order FY24(Actual) H1 FY25 H2 FY25+ • FY24 sales in line with expectations Run rate sales $17.5m $4.2m Military Customers $9.6m $2.1m • H1 FY25 off to a solid start with $17.7m of customer orders (multiple o
Slide 18: HighCom Technology – Overview
HighCom Technology – Overview • Co -loc ated with Corporate Headquarters in Canberra, ACT, Aus tralia. • Supplies and supports uncrewed systems, control systems, and sensors for use by Defence, Security and Law Enforcement For personal use only agencies in Australia, and around the world. Key output
Slide 19: HighCom Technology – Update
HighCom Technology – Update • HighCom Technology finalised the delivery of AeroVironment Small Unmanned Aerial Systems (SUAS) for the ADF. For personal use only • The initial 4-year term of the contract for support services is valued at $15.9m, with potential for up to $23m of spare parts over the i
Slide 20: AV's Offering We Represent in APAC
AV’s Offering We Represent in APAC • AeroVironment (AV) is a US company and world leader in unmanned aerial vehicles. • AV’s Tomahawk Kenisis Ecosystem, is an AI-enhanced, open architecture, common universal control system designed for the warfighter For personal use only first. Built for ease of us
Slide 21: Revenue Reconciliation and Forward Order Book
Revenue Reconciliation and Forward Order Book For personal use only Summary of Deals - Technology Order FY24 H1 FY25 H2 FY25+ • FY24 sales in line with expectations (Actual) SUAS Spares $8.5m $3.6m • SUAS Support Contracts in H1 FY25 are Support Contracts $5.1m $2.1m $8.7m valued at $2.1m and for H2
Slide 22: Strategy & FY25 Outlook
Strategy & FY25 Outlook only Maintain Strategy use REINFORCE SUCCESS SEEK ADJACENCIES CREATE OUR FUTURE Invest in the areas of our business that have Find new business opportunities that extend Invest in organic and inorganic expansion been successful and have potential for our reach and can draw on
Slide 23: Industry Trends & Outlook
Industry Trends & Outlook A heightened global threat environment has and will continue to drive defence spending for both military and law enforcement For personal use only Defence Budgets pre - and post-Ukraine (US$bn) • There is an increasing foc us on autonomous s olutions that prov ide as y mmet
Slide 24: Industry Trends & Outlook
Industry Trends & Outlook Plates and military account for ~75% and ~60% of the addressable personal armour market size by armour and customer type, respectively For personal use only By Armour Type By Customer Type (US$bn) (US$bn) ~2,410 ~15 Shields ~2,410 ~415 Helm et s ~925 Law 5- 6% g r owt h 5-
Slide 25: Conclusion
Conclusion • Disappointing full year result however turn around in H2 positive and For personal use only more indicative of future. • Board’s strategic initiatives to improve cost base and operational focus is on track however ongoing focus remains on inventory levels, cost analysis, product develop
Slide 26: Appendix
For personal use only Appendix
Slide 27: Summary Income Statement
Summary Income Statement Summary Income Statement FY23 FY24 Change Revenue A$m 89.4 45.3 (49%) For personal use only Cost of Sales A$m (55.7) (31.9) 43% Gross Profit A$m 33.7 13.4 (60%) Gross Margin % 38% 30% (8pp) Other Income A$m 0.1 0.3 191% Operating Costs A$m (22.8) (23.0) 1% EBITDA A$m 10.9 (9
Slide 28: Summary Financial Position
Summary Financial Position Summary Financial Position FY23 FY24 Change For personal use only Cash A$m 6.9 6.2 (0.7) Receivables A$m 24.7 3.6 (21.1) Inventories A$m 25.7 17.8 (7.9) Other Current Assets A$m 4.5 0.7 (3.8) Total Current Assets A$m 61.8 28.3 (33.5) PP&E A$m 9.8 8.5 (1.3) Other Non-curren