SRT MARINE SYSTEMS PLC
("SRT" or the "Company")
SRT Marine Systems PLC (SRT), a global provider of maritime surveillance, monitoring and management systems, today announces a trading update for the current financial year ending 31 March 2020.
Following recent advice in respect of Middle East system contracts with an aggregate value of £65m that contracting process formalities were now complete and the contracts scheduled for signature and commencement during March, the Company has received formal written notification, confirming the status of the contracts, but also that their expected signing and commencement date will likely be delayed. The reason provided by the customers for the delays are related to their governments' response to Coronavirus which is requiring them to immediately and unexpectedly reprioritise their short-term operational focus, combined with expected restriction of movement of goods and people.
The initial contractual milestone deliverables relevant to the current financial year are the GeoVS data centre systems, which would be required to be delivered within the first few weeks of the contract signings and generate approximately £14m of revenues. The balance of the system will be delivered across multiple milestones of various values over an 18 month period. However, because of the expected delay, the first milestones are now expected to be completed and their associated revenue recognised in the next financial year which commences on 1 April 2020. The effect of this change to the current financial year will be to reduce expected year end revenues to £17.5m with an expected loss before tax of approximately £3.8m. The impact on the next financial year however will be to substantially increase our revenues and we will provide market guidance once these contracts are signed.
While the written guidance SRT has received is clear that the delay may only be a matter of a few days and thus may not have a financial impact on the current financial year trading performance, SRT believes there is a material risk that the contract signing and milestone completions will move into the next financial year.
A live web cast will be undertaken by Simon Tucker at 0800AM on Wednesday 11 March 2020 to answer shareholder questions.
SRT CEO, Simon Tucker said:
"Of course, we understand and respect the decision of our customers to concentrate on the current exceptional circumstances. Nevertheless, the timing and nature of this delay is unexpected and very disappointing, and I apologise to my colleagues and shareholders for the angst this unexpected delay will no doubt cause. However, I hope it is of some re-assurance to note that after many years of diligent work we have reached the point of contract signature and that once we are past this short delay the contracts will proceed and the significant revenue lost in the current financial year added to the next."
For further information, please contact:
SRT Marine Systems plc
+ 44 (0) 1761 409500
Simon Tucker (CEO)
Louise Coates (Marketing Manager)
finnCap Ltd (NOMAD & Broker)
Jonny Franklin-Adams / Anthony Adams (Corporate Finance)
+44 (0) 20 7220 0500
Tim Redfern / Richard Chambers (ECM)
About SRT Marine Systems plc:
SRT Marine Systems PLC is a global company which develops and provides advanced vessel tracking, monitoring, management and analytic systems which are used by coast guards, fishery authorities, infrastructure and vessel owners for the purposes of managing and controlling their maritime domain. Applications include security, safety, search & rescue, law enforcement, illegal fishing detection and environment monitoring.
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.
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