Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Just in: Electro Optic (ASX:EOS) share price tanks on FY20 results

Shares in Electro Optic Systems Holdings Ltd (ASX: EOS) have fallen more than 9% today after the company released its FY20 results.

Electro Optic Systems is a leading technology company that’s involved in products such as software, lasers, electronics, optronics, telescopes and precision mechanisms. It operates in 17 countries and has over 500 employees around the world.

What did EOS report?

EOS reported revenue growth from ordinary activities of $180 million, up 9% on the prior corresponding period (pcp), despite complications arising from COVID-19.

Significant investment in inventory resulted in a negative operating cash flow of $109 million, and a net loss after tax of $25.6 million.

Longer than expected delivery times from decreased availability of international freight meant that a significant amount of revenue will be deferred into 2021 and 2022 as the delivery schedules are further pushed out.

Profitability throughout FY20 was further impacted by more indirect costs expensed as incurred throughout the period.

Segment performance

Defence revenue finished the year down by 1% due to COVID-19 interruptions. Due to the delivery issues, roughly $40 million of revenue was deferred into 2021, however, management has said this segment should return to profitability in 2021.

Communications revenue has come off a small base as a result of the company’s EM Solutions acquisition in 2019, which gives an unclear picture of the growth rate. Losses arising from SpaceLink will be mitigated in the second quarter as it transitions to independent funding.

Space Systems revenue increased by 27% over the period, boosted by the growing awareness and importance of space applications with a strong sales pipeline indicated by management.

FY21 growth plans

The below image shows a summary of nine products that will be a focus during the year and their respective revenue opportunities.

EOS FY21 Growth Priorities | Source: EOS FY2020 Results Presentation

Electro Optic has various products on the horizon as well as a large backlog with committed contracts not yet fulfilled. This includes EM Solutions backlog of $21 million, which will underpin FY21 revenue growth.

The pipeline is also strong with 208 separate opportunities, which has increased partially due to project deferrals caused by COVID-19. The company estimates a risked pipeline of $3.6 billion, representing the potential revenue from contracts it has tendered for (or qualified to tender for) over the next 36 months.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.
Skip to content