Electro Optic Systems Holdings Limited · ASX:EOS
Electro Optic Systems — FY2023 Earnings Presentation
29 slides from Electro Optic Systems's earnings presentation, Feb 28, 2024
Slide 1: 2023 Results Presentation
For personal use only 2023 Results Presentation Andreas Schwer, Managing Director & Chief Executive Officer Clive Cuthell, Chief Financial Officer & Chief Operating Officer 28 February 2024 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 28 February 2024. For personal use only Electro Optic Systems Holdings Limited (EOS) published the audited year end 31 December 2023 financial statements on 28 February 202
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 For personal use only this n
Slide 4: EOS Leadership Team
EOS Leadership Team For personal use only Andreas Schwer, MD & CEO Clive Cuthell, CFO & COO • Over 30 years in global Defence, • Over 15 years as CFO in global industrial Manufacturing and Space businesses • Previously with Rheinmetall AG, Manitowoc • Chartered Accountant 25 years and Airbus • Track
Slide 5: Contents
Contents 1. Summary FY23 Highlights For personal use only • • Market Conditions • Business Turnaround Update • Customer Base & Product Development • Future Opportunities 2. Financial Results • 2023 Performance • Segment Performance • Contract Backlog • 2023 Cashflow • Debt Position 3. Summary & Outl
Slide 6: Andreas Schwer, Managing Director & Chief Executive Officer
For personal use only Andreas Schwer Managing Director & Chief Executive Officer 6
Slide 7: Summary
Summary In 2023 EOS generated a positive Underlying EBITDA1 and reduced debt. European growth is targeted Turnaround 2023 saw significant progress in the EOS turnaround, including: For personal use only Continues • Highest ever revenue $219.3m up $81.3m on prior year • Underlying EBITDA1 positive $5
Slide 8: Market Conditions
Market Conditions Geopolitical uncertainty is creating very supportive market conditions, particularly for counter-drone products Context Outcome For personal use only • Entrenched conflict in Ukraine and • Increased defence spending broadening conflict Middle East • Global defence spending increase
Slide 9: Business Turnaround Update
Business Turnaround Update EOS is midway through a comprehensive program of change. Consistent execution of this strategy is delivering results Selected EOS ASX Announcements 2022 For personal use only RESTRUCTURING PROGRAM • Organisational structure right-sized, with reduction of ~100 Aug/Sep New C
Slide 10: Widening the Customer Base
Widening the Customer Base Significant progress was made in 2023 in widening the customer base For personal use only • Significant opportunities arising: 2023 significantly more diversified • Market-leading products Revenue by geography, % • Market growth driven by conflict 100% • Focus on European
Slide 11: Recent Product Developments and Growth Opportunities
Recent Product Developments and Growth Opportunities During 2023 we launched several innovative products - product development remains a key focus for the business Indicative revenue timing * For personal use only • Formal production launch in 2023 R150 Lightweight • Suitable for light vehicles 2023
Slide 12: Future Strategic Growth Opportunities
Future Strategic Growth Opportunities We have developed world-leading innovations with large addressable markets and we are currently seeking strategic partners High Energy Laser Weapon (HELW) For personal use only • There is an urgent market need for laser-based drone and missile defense systems. •
Slide 13: Clive Cuthell, Chief Financial Officer & Chief Operating Officer
For personal use only Clive Cuthell Chief Financial Officer & Chief Operating Officer 13
Slide 14: 2023 Financial Performance
2023 Financial Performance In 2023 EOS generated a positive Underlying EBITDA1 result driven by record 2H Revenue and Underlying EBITDA1 $m Full Year 2023 Result For personal use only 2023 2022 Var Continuing Operations • Revenue increased $81.3m (59%) on prior year, with across the board growth Rev
Slide 15: 2023 Segment Performance
2023 Segment Performance Both business segments contributed strong growth to the positive financial performance in 2023 $m For personal use only 2023 2022 Var Continuing operations 71% of FY23 rev. Revenue 155.4 106.0 49.4 1 Defence Underlying EBITDA 0.2 (33.3) 33.5 • Revenue increased by 47% on pri
Slide 16: Contract Backlog
Contract Backlog During 2023 EOS widened the product base and significantly increased the order book size For personal use only Contract Backlog, $m Contact Backlog (secured) - 31 December 2023 700 622 Description $m Business 600 RWS 206 Defence 181 500 Royal Australian Navy 187 EM Solutions 400 O
Slide 17: 2023 Cashflow
2023 Cashflow Cash Flow in 2023 included working capital realisation and new sales. Operating Cash was used to repay debt & invest in growth. $m 2023 2022 Var • Cash flow improvement includes impact of SpaceLink discontinued operations terminated in 2022 ($27m cash outflow in 2022) For personal use
Slide 18: Debt Position
Debt Position During 2023 Operating Cash Flows were used to reduce debt levels. Further scheduled debt reduction is planned in 2024. For personal use only $m Principal Term Maturity Total Rate Repayment1 Working Capital Facility 20.0 12m Sep 23 19% 26.9 REPAID Working Capital Facility 15.0 18m Apr 2
Slide 19: Andreas Schwer, Managing Director & Chief Executive Officer
For personal use only Andreas Schwer Managing Director & Chief Executive Officer 19
Slide 20: Our Commitments
Our Commitments We delivered on our commitments made in 2022 and 2023. We are committed to future business growth We said… We delivered… For personal use only • Focus on core businesses and strengths of point & track Formulate new strategy • Exit SpaceLink in 2022. Exit Australian Satellite Manufac
Slide 21: Summary – EOS Four Growth Pillars
Summary – EOS Four Growth Pillars We aim to drive current growth opportunities and further develop future growth opportunities with third party funding support Current Growth Future Growth Opportunity For personal use only R400 Family Naval Terminals Titanis CUAS Commercial Space World Market Leader
Slide 22: Summary and Outlook
Summary and Outlook Summary For personal use only • Market conditions are very supportive • EOS provides key products that the market is demanding – especially counter-drone • We will continue to widen the customer & product base - especially in Europe • Discipline will continue – Strategy, Capex, C
Slide 23: Questions
For personal use only Questions 23
Slide 24: Appendices
For personal use only Appendices 24
Slide 25: Reconciliation of Statutory Profit / (Loss) and Non-GAAP measures
Reconciliation of Statutory Profit / (Loss) and Non-GAAP measures Total Operations (Continuing & Discontinuing) 2022 2022 2022 2023 $m Continuing Discontinuing Total For personal use only Loss for the year (34.1) (53.6) (81.7) (135.3) Gain on assignment and effective disposal of SpaceLink - - 19.7 1
Slide 26: FY23 Segment Performance
FY23 Segment Performance Continuing Operations - $m 2023 2022 Var For personal use only Revenue Defence 155.4 105.9 49.5 Space (incl. EM Solutions) 63.9 32.0 31.9 Total 219.3 137.9 81.4 Underlying EBITDA Profit/(Loss) Defence 0.2 (33.3) 33.5 Space (incl. EM Solutions) 11.8 (3.0) 14.8 Unallocated (6.
Slide 27: EOS at a Glance
EOS at a Glance Defence Systems EM Solutions Space Systems For personal use only • Develops, manufactures and markets advanced • EM Solutions provides global satellite • Space Technologies applies EOS-developed technologies for weapon systems optimisation communications services and systems to prima
Slide 28: Remote Weapon Systems Product Range
Remote Weapon Systems Product Range EOS is developing a wider range of RWS products to meet evolving needs For personal use only 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 Co
Slide 29: For personal use only
For personal use only 29
Electro Optic Systems Holdings — FY2023 Earnings Presentation on 6ix