Srt Marine Systems Share Discussion Threads

[yump] 20/11/2023 08:53

Assuming the revenue forecast is met for this year it will be about the same as the market cap and the business will suddenly be touted as a potential growth star.

Many investors get very excited if they see a market cap 3x revenue let alone 1x

If you just don’t believe it will happen, or you think the current contracts are an illusion, that’s another issue.

[yump] 20/11/2023 08:49

Pinkfoot
Please try not to misrepresent.

The revenue for this year is expected from signed contracts, not the VSP. That is a separate thing.

[amt] 20/11/2023 08:49

I agree Pinkfoot, the balance sheet of SRT looks horrible now and how will they fund 60m of sales unless the get paid in advance. That's 40m of cost of sales in less than 6 months.
Thanks fft for info.

[integer] 20/11/2023 08:44

fft - the company has used the correct accounting treatment for Nexus as far as I can see. If you buy an apple at the end of year 1 for 25p and you sell it for 40p at the start of year 2, you don't make a loss of 25p in year 1 and then a profit of 40p in year 2. You report a profit of 15p in year 2 and the apple is carried on the balance sheet at a cost of 25p end of the 1st year.

Relating this to product development, if you spend £1m developing something and you have reasonable belief (with supporting evidence) it will be a success, by capitalising and amortising the cost over the useful economic life of the product then you match the revenues with the cost of obtaining such revenue. That being said, you have to constantly monitor your intangibles to ensure that they will be a success. If not, you should take a prudent view and be more aggressive with your amortisation and/or write off the cost more immediately. Don't think there is much doubt that Nexus will be a success.

[pinkfoot2] 20/11/2023 08:44

Morning AMT-I would rather be in SCE just now because they have cash, and real tangible sales forecasts-not the fabled VSP which trundles on.The debt and creditor pile in SRT is worrying, as is a short term £2m loan in Sept.I did ask what ‘gross cash’ means-looks like cash drawn from a loan facility!

SRT appears to be getting away with it because ST is a very enthusiastic CEO with a strong PI following-but not much interest from institutions.SCE raised £10m from largely institutional money in a horrible market

I remain loyal to both but SCE looks seriously undervalued.

[fft] 20/11/2023 08:38

Amt. No, it's worse than that.


According to Cavendish, they will do 9.6m transceivers in H2 and 55.8m systems in H2, leading to a total of 65.4m revenue.


Given SRT record of missing forecasts, I will not be holding my breath.

[amt] 20/11/2023 08:37

Yes Yump but its a drain on cashflow

[amt] 20/11/2023 08:36

Good Morning Pinkfoot, I Compared market cap with SCE and relative prospects.
Either SRT is massively overvalued or SCE undervalued. Interesting that shareholders have been so patient with SRT but not SCE

[yump] 20/11/2023 08:36

If some specific product investment is likely to have an ongoing value to the business then capitalising it and treating it as an intangible asset is normal. Especially with a business like SRT where afaik a lot of the products have unique IP.

Patents and IP created are worth something to another business, so they’re not part of P&L.

In any case, the depreciation of the intangible asset will affect the P&L account in several future years, so they’re not avoiding anything.

[amt] 20/11/2023 08:33

So they need 35m of sales between now and March 2024 if I have calculated correctly ?

[pinkfoot2] 20/11/2023 08:32

Really not pretty-the balance sheet is weak and stripping out intangibles, looks very thin indeed.

As with any business, they need sales and quick-increasing the debt pile isn’t a good look.

And yes, where are the H1 slippage numbers from 2023?

The company is in danger of believing better than it is

[yumyum] 20/11/2023 08:17

Cavendish, SRT's broker, forecasts after tax earnings per share of 3.8p for the financial year ending 31 March 2024, and 6.2p for the year ending March 31st 2025.

[pugugly] 20/11/2023 08:10

Still grossly over valued at a market cap of £72M (imo)
If a take over bid any guesses at a takeout price?

[amt] 20/11/2023 08:09

Yes spending over 2m on R&D which is capitalised. That's why cash burn is so high.

[fft] 20/11/2023 08:09

If for Nexus, it should have gone through the P and L and be tangible assets that are depreciated normally. Treating product investment as intangibles so they dont appear in the PandL is dressing up the P and L - though it looks bad enough anyway !

[carcosa] 20/11/2023 08:04

Deleted. Wrong board

[integer] 20/11/2023 07:59

fft - increasing intangible assets would be the product investment, mainly for NEXUS.

[fft] 20/11/2023 07:47

Not sure why intangible assets are rising 1m every 6 months. Anyone any idea on that ? Makes the bottom line of the balance sheet look better, but..... If intangibles are stripped out, total assets (current plus non current) minus current liabilities is negative. I.e. negative net assets. They already have negative current assets.

[amt] 20/11/2023 07:34

Cash burn 5 million if I calculated correctly. Another cash raise or more loans ?

[amt] 20/11/2023 07:27

March 2023 update. The shortfall in the last results was supposed to appear in H1 2024 and yet nothing. What is going on?


Our systems business will have generated revenues of approximately GBP18.0m (prior year: GBP0.6m) and our transceivers business approximately GBP12.0m (prior year: GBP7.6m). These results are lower than market expectations for the current year primarily due to material systems business project milestones that had been expected to be completed by the end of the current year being delayed to the early part of the new financial year.

[owenski] 17/11/2023 15:42

"Increase the ping", lol, such a good watch, I'd forgotten that sketch, and so true of a lot of situations.

[fft] 17/11/2023 01:10

At least he didn't use the word 'imminent' :-). Then you would know it was an April's fool

[goodapple] 16/11/2023 19:57

Not invented (by me anyway). Check out SRT Gallery

[cliffpeat] 16/11/2023 19:56

I always shudder when the word "incredible" is used like this - I really do want to believe!

However, it's reassuring that it exists, has blue lights - but does it go "ping"?

[zingaro] 16/11/2023 19:55

goodapple: well invented (I assume)