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Quickstep Holdings Limited, the manufacturer of high‐grade carbon‐fibre components, reported sales of $3.7 million for the half‐year to December 31, 2013, more than double the sales of the prior period (2H FY2013: $1.8 million).
Total revenue for the half, including grants, was $6.3 million compared to $3.6 million in the previous corresponding period. Operating cash receipts were $12.7 million. Quickstep reported a loss of $5.9 million, in line with the company’s expectations (1H FY2013: $7.4 million loss).At 31 December 2013 the company held cash of $7.1 million as well as restricted cash deposits of $4.1 million. Quickstep managing director, Philippe Odouard, said: “Quickstep’s revenue is growing according to plan. Our firm order book is now valued at $42 million, and the majority of the work is scheduled to be completed in the next eighteen months. Our flagship Joint Strike Fighter and C‐130J contracts are ramping up, and we continue to progress the OPRE Technologiya Quickstep Process contact and plans to commercialise the resin spray transfer technology for the automotive sector.”Aerospace & Defence manufacturingQuickstep sales are expected to increase substantially in the second half as contract manufacturing for the Lockheed Martin C‐130J Super Hercules aircraft and the F‐35 Lightning II Joint Strike Fighter increases. The company delivered the first shipset of four C‐130J carbon‐fibre wing flaps for Lockheed Martin ahead of schedule in early 2014. Quickstep has received purchase orders for 36 shipsets and further orders will be confirmed as the US$75 million program continues. Under the memorandum of agreement, Quickstep will deliver 120 C‐130J shipsets through to 2018.Manufacturing for the Joint Strike Fighter Program doubled compared to the prior period, and at 31 December 2013 Quickstep had completed delivery of 191 JSF parts since the beginning of the program. The JSF program continues to mature operationally and passed the 100,000 flight hours milestone in September 2013. At peak JSF production rates, Quickstep is expected to generate JSF revenue of approximately $40 million per annum subject to receipt of ongoing purchase orders.Technology commercialisationDuring the half, Quickstep received a $1 million Australian government grant to support qualification of the Quickstep Process for manufacturing vertical tail spars for the Joint Strike Fighter program. The Quickstep Process is a patented technology which moulds carbon fibre and resin using heated liquids, curing composite components more efficiently than traditional techniques at much lower cost.Quickstep secured its first sale of this technology to ORPE Technologiya, which will use the Quickstep Process to manufacture large carbon‐fibre shielding for satellites during launches. This contract is valued at $6 million and will be delivered over the next eighteen months. Its first significant milestone, the preliminary design review to adjust technology to the client’s requirements, is taking place in Russia before the end of February as planned. Marketing of the company’s resin spray transfer (RST) technology for the automotive industry is continuing, and the company received a significant endorsement when the technology passed a European luxury car maker’s stringent surface and ageing tests. Negotiations on possible contracts with auto manufacturers are continuing.Balance sheetDuring the half Quickstep completed an institutional placement and share purchase plan, and net proceeds from the capital raising were $12.7 million.OutlookAs contract manufacturing work continues to build, Quickstep anticipates growing sales in the second half of FY2014 and remains on track to achieve total revenue of around $17 million for the full year. The company expects to become cash flow positive during FY2015. The company has submitted a number of commercial‐ in‐confidence tenders to aerospace and defence companies regarding potential new contracts, and continues to progress its plans to commercialise its Quickstep Process and resin spray transfer technologies.More information:www.quickstep.com.au