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I really do not wish to sound like I am bashing this stock, I have held it for several years and nothing would please me more than to see it thrive. I believe in the MDA concept and the AIS boxes are excellent.
That said, SRT clearly do not yet have the funding in place to proceed on the current large contract, and having guided much of that revenue into this year, I am fearful that the end of year results will be a massive under-performance. I recall reading that the company has also commenced the purchase of much of the hardware for it, which means cash tied up, cash which the recent investment by Ocean Infinity and the small public offer has plugged for now.
The recent Investor Presentation was more notable for what Simon Tucker did not say as opposed to what he did say. If we are on track for the previously stated year end guidance, I am sure it would have been re-stated during the presentation and it wasn't.
I shall be continuing to hold SRT in my portfolio, and trust that the current down trend reverses pretty soon. Currently it looks like an easy acquisition target.
Happy to hear other peoples views
Hi Bullwinkle, Crashcat and Hardboy.
Thanks for the excellent posts. I did think that the UKEF arrangement was ready to rock but I didn't allow for further admin but I suppose they do seem to make certain things are as the original agreement stated.
I guess the size of the contract is in fact a problem. If it had come after say 2 or 3 smaller ones then the lumpiness of the milestone payments would have been smoothed out. I've been here some 8 years now and have always had confidence in the way things have been progressed and improved.
My only puzzlement is Ocean Infinity. It seems dynamic and has a feel not unlike SRT. I know undersee cable and pipelines are of course extremely vulnerable and protection is important. I can see our growing customer base being useful to Ocean Infinity but the only advantage to SRT as far as I can see is is if we act as an introducer or indeed as a sales arm?
Oh well, time will tell all I expect. Onwards and upwards!
I did think thst thr EKEF
Hi Crashcat and Bullwinkle,
Thanks for the posts
Hi to Truro Trader and thanks for your thoughts.
Contracts of this nature are lumpy by nature, I have spent many years in manufacturing, building 'custom' power equipment, which can be subject to all sorts of delays, resulting in invoicing rolling from this to next month and making a mockery of revenue forecasting, particularly when the role over is to the next financial year.
So long as the funding actually comes through, then the revenue will be generated at some point in the future, however the markets do not react well to such peaks and troughs and we are seeing this all the more right now.
Right now, I would appreciate Simon Tucker either confirming the previously published guidance, or providing a more realistic end of year outlook.
I am also concerned that as SRT transitions from developing the MDA solution to actually delivering in the field, that the company is in need of new skill sets that are more operational focussed. I see many AIM companies who struggle to make a smooth transition to the delivery stage and I suspect SRT are suffering also. With such a large contract on the opposite side of the world as the first really big one, I hope we have an experienced Project Manager / Operations Manager in place to focus on it, and one who has the authority to make decisions in relation to its delivery.
Looking forward to this current down trend reversing !!
Again! We're where we were well over a year ago and without £160 Mill of contracts! Some 7 weeks to go to the year end. As the song says 'I'm hoping and praying'.
I do appreciate that at some point we should hit milestone payments but if the £140 Mill contact doesn't start in this financial year then not only will the markets possibly react badly but we may need another cash call!
Only 7 weeks to go folks!!
Been in close to 10 years now and I have usually bought on the dips as I trusted the process and ST.
However I’m beginning to just get a little bit jaded.
The strategic investor added confidence and I took up my entitlement but if ST has overcooked the H2 expectations we’re looking at mid 20’s at best.
I see the vision and get it but the market is getting tired of waiting for the jam….