Member Info for RogerMellie50

"Our review of the future strategic priorities of the business is nearly complete and I expect to update shareholders about this before the end of the financial year."

Spinning off the non-defence divisions?

Morning all,

I made the point about lumpy revenues a few weeks ago, so not surprised/concerned. I still read financial reports with a battered copy of 'Balance Sheets for Dummies', but the increase/decrease in inventories and recievables is clear for all to see.

My slight concern is with land-based systems. We only know of two sales - part of the MoD package to Ukraine, and I assume a delivery to the Jordanian Airforce (given by their Linkedin comments about 'proudly supporting' them at a recent expo over there). Lots of attendance at expos, talk of 'attaining a similar reputation' etc, but actual contracts? Part of me feels that their recent advert for an animator for their marketing team may speak to a need to convert more interest in to actual contracts, but I may be miles off.

I'd now expect 6 months of a complete lack of material news, but this comment was interesting: "Our review of the future strategic priorities of the business is nearly complete and I expect to update shareholders about this before the end of the financial year."

Sorry, better link.

https://www.msi-dsl.com/careers-msi-ds/animation-graphic-designer/

Someone hitting the sell button again today. Buy limit order for me at 10 quid for a few more.

Notcied this. Not my area, but they seem to be recruiting someone for a full-time job designing graphics and animation for their marketing material.

https://www.glassdoor.co.uk/job-listing/animation-and-graphic-designer-msi-defence-systems-ltd-JV_IC2672727_KO0,30_KE31,54.htm?jl=1009552855964

Ah yes, I'd mistaknely just used the lower 'profit before taxation' figure from the finals, so even cheaper with true EBITDA.

I bought years ago here and have just held, but have recently bought a few more on dips under 10. Annoyingly, over half my holding are in my dealing account, so am looking at an opportunity to sell and buy back cheaper in my ISA at some stage, although I'll more than likely make a hash of it!

I started a small position in Concurrent Tech at 1.42 last week, having heard you mention it here and having done some reading up myself. Won't hold you accountable for any losses though! 😉

Thanks for that, Pharmall. So EV/EBITA ratio of 7.25 odd, if I'm not mistaken. Certainly is cheap.

We'll find out next week or the one after anyway. Can't blame them on the marketing front - they've been at absolutely every trade fare/expo going all year.

Morning John,

Have a look at Cohort's RNS this morning. 40 million placing (and one million retail) for M&A activity down-under for a company that specialises in naval satelite communications.

From what I can tell, and I defer to anyone with better knowledge, three of the ships that will be decomissioned as per today's address by the defence secretary are fitted with two MSI cannons each. So we're looking at MSi loosing the servicing of 6 weapon systems. Not exactly a devastaing blow, I don't think. I bought some more again today.

Flooding in Valencia will be an exceptional cost for 25, recouped on insurance in FY26. Trading at 6.5 earnings for FY26? Really does look cheap.

Solid. Expected a softeness with the solar division and roads and security from the Half-year presentation, but good to see progress everywhere else (particularly uptick in UK galvanising). CEO settling in.

Wonder if there will be any new M&A activity announced with TU on wednesday?

I notcied that too, John. BAE's shipyards you mention on the Clyde in Glasgow are where the RN type 26 frigates that will each have 2 of MSi's DS30M 30mm guns systems installed are being made. I believe the first ship Glasgow will have sea trials early 2026, and the second one Cardiff is almost structurally complete. There's some talk that Norway might be comissioning some of the type 26 frigates as well. Long way down the line, but a strong possibility they would keep the same weapon systems.

I know John, it's a frustrating company. 2 reports a year, which are light on specifics, and that's your lot!I took a few more later on as well from a dividend that came in today. First time I've bought here for years. Looks like other defence stocks (Cohort/Concurrent) have been sold off today as well.

Hi Tav,

Just guess work from me - saw SOLI was top of the fallers this morning, so checked out their RNS and then read accross.

I don't have any specific knowledge of Msi's MoD contracts (I know there's the type 26 frigates and the servicing ones on the government tender site) or the pending defence review, but one of Msi's big advantages in my view is its broad client base in the defence divison (US/German/Indonesian/Egyptian navies, Jordanian airforce, off the top of my head), hence why I say risk is limited. Can understand a bit of the jitters whenever a government spending review is upcoming, but they can also be opportunities too.

Morning John,

I'd guess those hitting the sell button this morning were (over) reacting to Solidstate's RNS (some of their MOD contracts have been paused before a UK defence review next year, although they still expect them to be placed but falling next FY). Don't see the risk to Msi from any defence review, so added a few more myself.

Some light reading for you John - couldn't make it up!

https://en.wikipedia.org/wiki/International_Signal_and_Control

Hi Pharmall,

Thanks for those numbers. From the full years, they said they were well-placed to gain the 5 year follow-on order from the US Navy, but don't expect it to land this financial year (i.e before April 25). I assume this would come up on the US defence contract database, and there's nothing showing so far.

Any thoughts behind MSi's tax rate?

I had a looked at Qinetiq's results this morning - looked encouraging to me, but the market didn't seem to agree.

Yes, very good point. I remember being on holiday in the south of France once and my dad getting a 2 day old copy of the Times and reading it over breakfast -sudden silence on turning a page and a futile dash to the local Tabac to get on the horn to his stockbroker. Can't remember what the share was now, but shoes how things have moved on!

Hope you got out of Ferranti in time, John! My dad got absolutely stiffed, broker had been telling all his lowly retail clients all was fine. Not going to name him here, but he did 3 years at Her Majesty's leisure for fraud subsequently! To be honest, it was a lesson for my old man, and he became a much better investor as a result.

Hi Pharmall,

Thanks for that, I'll give Concurrent a look. Have to make up our own forward P/Es for Msi!

I've always steered away from defence, largely from early memories of my old man losing his shirt when International Signal and Control pole-axed Ferranti (returned me back to the state education system from the private school I was in at the time!). I think times are right now to get some more exposure though.

Morning John,

Talking about MSi's P/E ratio the other day, I see Tesla now has a forward P/E of over 100! Trader friend of mine thinks it's a 'meme stock', but admits that's part jealousy as he sold out last year.