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http://www.ihsairport360.com/article/604...ks-iferret

From the info on the above website, can we surmise that roughly 30% of the contract was recurring income? Take 80mil (5 yrs maintenance + 2 yr option) over total value of contract, one will get ~ 30%.

I quote below:-

"Stratech Systems is to supply its iFerret automated foreign object debris (FOD) detection system for Hong Kong International Airport, following competitive tender awards from the Airport Authority Hong Kong (AAHK).

Singapore-based Stratech is teamed with Dah Chong Hong - Dragonair Airport GSE Service (DAS), which won two contracts from the AAHK. The first, worth HKD199.66 million (USD26.31 million), covers the design, supply, and installation of an electro-optical automated FOD detection system "for a period of 850 calendar days from 28 February 2015".

The second contract, worth HKD79.33 million, is for five years' maintenance of iFerret plus an optional extra two years."

many tks.

Yes, I reproduced the revenue info gathered on the Dubai airport to answer your answer on the likely FY2014 performance (i.e. to be reported soon in end May 2015).

(05-05-2015, 10:34 PM)littleones Wrote: [ -> ]

(05-05-2015, 10:20 PM)BlueKelah Wrote: [ -> ]

(05-05-2015, 10:04 PM)littleones Wrote: [ -> ]

(05-05-2015, 09:48 PM)BlueKelah Wrote: [ -> ]Listed since 2004, ten years liao, bo dividend and keep asking for money. 4 rights issue every 2-3 years. Yesterday kana SGX query on trading volume spike. Will it have some more rights issue again? sell cheap cheap to SIA company can liao lah.

Fundamentals looks like an S-chip leh.

waste of time.

iFerret got FAA endorsement and buy American waiver in 2012. Since then it have secured three contracts: Dubai, USAF, HKIA. Its test beds are at Changi Airport (2008) and Chicago O'Hare (2009). On going negotiation includes quite a few airports. Should see revenues spike up in 2016 reporting season.

so since 2012 only managed to get 3 contracts? one contract a year is it big contract? system if so good how come so few contract?

which are the airports ongoing negotiation, any details?

revenue spike in 2016? what they building? need 2 years to "t.o.p" like property ah?

last quarter loss more than revenue on SGX watchlist. How much longer it will get delisted? can it afford to be loss making till 2016?

This year's reporting season should include full revenue from Dubai, upgrade of iFerret at Changi, 59 iVACs installed in the ME and possibly part of revenue from HKIA. Stratech should be in the black and out of watchlist.

2015 will be a defining year for Stratech

(06-05-2015, 08:03 AM)Curiousparty Wrote: [ -> ]http://www.ihsairport360.com/article/604...ks-iferret

From the info on the above website, can we surmise that roughly 30% of the contract was recurring income? Take 80mil (5 yrs maintenance + 2 yr option) over total value of contract, one will get ~ 30%.

I quote below:-

"Stratech Systems is to supply its iFerret automated foreign object debris (FOD) detection system for Hong Kong International Airport, following competitive tender awards from the Airport Authority Hong Kong (AAHK).

Singapore-based Stratech is teamed with Dah Chong Hong - Dragonair Airport GSE Service (DAS), which won two contracts from the AAHK. The first, worth HKD199.66 million (USD26.31 million), covers the design, supply, and installation of an electro-optical automated FOD detection system "for a period of 850 calendar days from 28 February 2015".

The second contract, worth HKD79.33 million, is for five years' maintenance of iFerret plus an optional extra two years."

Firstly the HK$80m is for 5 years so it is roughly HK$15.87m a year of revenue to DAS (not stratech) which is about 8% of contract value. Closer to my statement of "about 5% revenue" than your 30% guesstimate. 8% is pretty good deal.

Furthermore the HK$199.66m will be spread over 28 months, not linearly but roughly we know the revenue booking ANNUALLY (again to DAS not Stratech).

Secondly it is not unprecedented since there is the Changi Airport example to estimate the recurring revenue. So actually we can do better than grabbing numbers from the air.

My post did not suggest that the entire income accrued to Stratech.
(not sure about the phrase "grapping numbers from air"?)

But my best guess is that Stratech will get the significant portion of the income. Not sure what is the value add by the "System Integrator"?


So much for the following proverb ...haha
"Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward "
[got a feeling that this forum has become more of an "accusation" forum... Sigh]

(06-05-2015, 10:24 AM)specuvestor Wrote: [ -> ]

(06-05-2015, 08:03 AM)Curiousparty Wrote: [ -> ]http://www.ihsairport360.com/article/604...ks-iferret

From the info on the above website, can we surmise that roughly 30% of the contract was recurring income? Take 80mil (5 yrs maintenance + 2 yr option) over total value of contract, one will get ~ 30%.

I quote below:-

"Stratech Systems is to supply its iFerret automated foreign object debris (FOD) detection system for Hong Kong International Airport, following competitive tender awards from the Airport Authority Hong Kong (AAHK).

Singapore-based Stratech is teamed with Dah Chong Hong - Dragonair Airport GSE Service (DAS), which won two contracts from the AAHK. The first, worth HKD199.66 million (USD26.31 million), covers the design, supply, and installation of an electro-optical automated FOD detection system "for a period of 850 calendar days from 28 February 2015".

The second contract, worth HKD79.33 million, is for five years' maintenance of iFerret plus an optional extra two years."

Firstly the HK$80m is for 5 years so it is roughly HK$15.87m a year of revenue to DAS (not stratech) which is about 8% of contract value. Closer to my statement of "about 5% revenue" than your 30% guesstimate. 8% is pretty good deal.

Furthermore the HK$199.66m will be spread over 28 months, not linearly but roughly we know the revenue booking ANNUALLY (again to DAS not Stratech).

Secondly it is not unprecedented since there is the Changi Airport example to estimate the recurring revenue. So actually we can do better than grabbing numbers from the air.

I am referring to your posts #1 #10 #18 #31 where you have margin and revenue assumptions. If you look at the timing of my posts, I have waited till yesterday and I have been following the thread since day 1 more than a week ago for the record. Which part of my posts is accusational and ungrounded since we all agree that we need to have a robust discussion in this forum, as per your posts elsewhere from escapades in New Toyo, China Sunsine to favourite CES?

As per my previous post, yes Stratech will have a higher % margin than SI though value lower.

SI implements the system like how Datacraft installs cisco systems. They usually include the hardware cost in their billing hence value is large but the margins are thin. It's a matter of % numbers. SI value is mainly maintaining and making sure things work, and a liason between the solution provider and end customer. Customers don't care how it works... they just want it to work. So the SI takes care of the technicalities.

(06-05-2015, 10:50 AM)Curiousparty Wrote: [ -> ]My post did not suggest that the entire income accrued to Stratech.
(not sure about the phrase "grapping numbers from air"?)

But my best guess is that Stratech will get the significant portion of the income. Not sure what is the value add by the "System Integrator"?


So much for the following proverb ...haha
"Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward "
[got a feeling that this forum has become more of an "accusation" forum... Sigh]

(06-05-2015, 10:24 AM)specuvestor Wrote: [ -> ]

(06-05-2015, 08:03 AM)Curiousparty Wrote: [ -> ]http://www.ihsairport360.com/article/604...ks-iferret

From the info on the above website, can we surmise that roughly 30% of the contract was recurring income? Take 80mil (5 yrs maintenance + 2 yr option) over total value of contract, one will get ~ 30%.

I quote below:-

"Stratech Systems is to supply its iFerret automated foreign object debris (FOD) detection system for Hong Kong International Airport, following competitive tender awards from the Airport Authority Hong Kong (AAHK).

Singapore-based Stratech is teamed with Dah Chong Hong - Dragonair Airport GSE Service (DAS), which won two contracts from the AAHK. The first, worth HKD199.66 million (USD26.31 million), covers the design, supply, and installation of an electro-optical automated FOD detection system "for a period of 850 calendar days from 28 February 2015".

The second contract, worth HKD79.33 million, is for five years' maintenance of iFerret plus an optional extra two years."

Firstly the HK$80m is for 5 years so it is roughly HK$15.87m a year of revenue to DAS (not stratech) which is about 8% of contract value. Closer to my statement of "about 5% revenue" than your 30% guesstimate. 8% is pretty good deal.

Furthermore the HK$199.66m will be spread over 28 months, not linearly but roughly we know the revenue booking ANNUALLY (again to DAS not Stratech).

Secondly it is not unprecedented since there is the Changi Airport example to estimate the recurring revenue. So actually we can do better than grabbing numbers from the air.

If my assumptions are not valid, just kindly point out. Don't have to use mean words like "grapping numbers from air, wasting VB's time, etc".
I guess everyone here should be "highly educated". Hope visitors to this forum will not think that the people here are so "uncivilized"


Key assumptions are (might be flawed)
1. 33% of revenue each year goes to partners for each airport (just a general assumption)
2. $50mil over 5 yrs = $10 mil per year (Hong Kong airport case, just an example)
3. So, Stratech gets to keep say $6.6mil per year.
4. NPM = 20%. So net profit per year (over the 5 yr period) = $1.32 mil (per airport like Hong Kong)
5. Say, overall, Stratech manages to secure contract for 30 airports at steady state, we would have ~ $40mil per year (over 5 yrs)
6. Assume undemanding P/E of 10, market cap works out to be $400mil.

Have summarized the key risk factors below (might not be comprehensive)
1. Not every new airport contract secured can be as big as the HK contract.
2. Not sure what portion of the contract is earned by the partners.
3. Although iFerret has proven itself at 6 airports now, it remains to be seen how fast iFerret can be rolled out to the rest of the world.
4. Most of the contract value is for installation (i.e. capex). Recurring income needs to be built up to support valuation.
5. Although there are about 10,000 airports (commercial + military), will each of them need automated FOD eventually? Is 2% assumption for automated FOD market too ambitious?
6. Of the 2% automated FOD market, how much can Stratech corner? 30% ? 50%?

(06-05-2015, 10:57 AM)specuvestor Wrote: [ -> ]I am referring to your posts #1 #10 #18 #31 where you have margin and revenue assumptions. If you look at the timing of my posts, I have waited till yesterday and I have been following the thread since day 1 more than a week ago for the record. Which part of my posts is accusational and ungrounded since we all agree that we need to have a robust discussion in this forum, as per your posts elsewhere from escapades in New Toyo, China Sunsine to favourite CES?

As per my previous post, yes Stratech will have a higher % margin than SI though value lower.

SI implements the system like how Datacraft installs cisco systems. They usually include the hardware cost in their billing hence value is large but the margins are thin. It's a matter of % numbers. SI value is mainly maintaining and making sure things work, and a liason between the solution provider and end customer. Customers don't care how it works... they just want it to work. So the SI takes care of the technicalities.

(06-05-2015, 10:50 AM)Curiousparty Wrote: [ -> ]My post did not suggest that the entire income accrued to Stratech.
(not sure about the phrase "grapping numbers from air"?)

But my best guess is that Stratech will get the significant portion of the income. Not sure what is the value add by the "System Integrator"?


So much for the following proverb ...haha
"Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward "
[got a feeling that this forum has become more of an "accusation" forum... Sigh]

(06-05-2015, 10:24 AM)specuvestor Wrote: [ -> ]

(06-05-2015, 08:03 AM)Curiousparty Wrote: [ -> ]http://www.ihsairport360.com/article/604...ks-iferret

From the info on the above website, can we surmise that roughly 30% of the contract was recurring income? Take 80mil (5 yrs maintenance + 2 yr option) over total value of contract, one will get ~ 30%.

I quote below:-

"Stratech Systems is to supply its iFerret automated foreign object debris (FOD) detection system for Hong Kong International Airport, following competitive tender awards from the Airport Authority Hong Kong (AAHK).

Singapore-based Stratech is teamed with Dah Chong Hong - Dragonair Airport GSE Service (DAS), which won two contracts from the AAHK. The first, worth HKD199.66 million (USD26.31 million), covers the design, supply, and installation of an electro-optical automated FOD detection system "for a period of 850 calendar days from 28 February 2015".

The second contract, worth HKD79.33 million, is for five years' maintenance of iFerret plus an optional extra two years."

Firstly the HK$80m is for 5 years so it is roughly HK$15.87m a year of revenue to DAS (not stratech) which is about 8% of contract value. Closer to my statement of "about 5% revenue" than your 30% guesstimate. 8% is pretty good deal.

Furthermore the HK$199.66m will be spread over 28 months, not linearly but roughly we know the revenue booking ANNUALLY (again to DAS not Stratech).

Secondly it is not unprecedented since there is the Changi Airport example to estimate the recurring revenue. So actually we can do better than grabbing numbers from the air.

(06-05-2015, 11:06 AM)Curiousparty Wrote: [ -> ]If my assumptions are not valid, just kindly point out. Don't have to use mean words like "grapping numbers from air, wasting VB's time, etc".
I guess everyone here should be "highly educated". Hope visitors to this forum will not think that the people here are so "uncivilized"

1. 33% of revenue each year goes to partners for each airport (just a general assumption)
2. $50mil over 5 yrs = $10 mil per year (Hong Kong airport case, just an example)
3. So, Stratech gets to keep say $6.6mil per year.
4. NPM = 20%. So net profit per year (over the 5 yr period) = $1.32 mil (per airport like Hong Kong)
5. Say, overall, Stratech manages to secure contract for 30 airports at steady state, we would have ~ $40mil per year (over 5 yrs)
6. Assume undemanding P/E of 10, market cap works out to be $400mil.

The key risk factors are:-
1. Not every new airport contract secured can be as big as the HK contract
2. how fast iFerret can be rolled out is still a big question.

For the record I didn't say "wasting VB's time". You are referring to Blue Kelah

I honestly think that you are "grapping numbers from air" because like I said, it is not unprecedented and you can get the numbers if you dig more from Changi Airport contract. It is not like a dot com where you must have a guesstimate from the gut. And you seemed to be a keen learner of Monte Carlo Simulation which is more complex so I might have too high an expectation. If it sounds "uncilvilised" vs your other escapades in other threads, then I apologise.

I think my posts are sufficient to show that your numbers are ungrounded, and I even hinted it sounded like Inter Rollers projections which produces conveyer systems for airports when airport constructions was at its peak in China.

Other forumers have pointed out how many airports have used the system since 6 years ago will give you rough idea whether these projects are lumpy or sustainable.

Since you want to be more specific to your assumptions, say if you use HK airport case, and assuming we say the contract is with Stratech and not DAS ie full 100% accreditation, the revenue per year would be roughly HK$86m a year for the 28months (not 5 years, and I dont know how you get $50m over 5 years in your working above) so say FY2016 and FY2017. Profit at NPM of 20% (which prima facie doesn't seemed the case from 2009-11 results when Changi started, but let's be optimistic) would be HK$17.2m.

Thereafter the maintenance contract is HK$16m a year for FY18-22 and let's say 50% margins for maintenance ie HK$8m

At 10X Forward PE FY2016 what do you think is the value of HK airport contract to Stratech assuming 100% accreditation, bearing in mind 10X PE effectively means like you said steady state of getting at least one such project a year? And of course multiplies anything by 30 will be a very big number, if they can actually scale 30X in the real world, not some numbers extrapolation.

IMHO if they can secure one a year by themselves and one like the HK deal, it would be very good already based on the past 6 years track.

(06-05-2015, 11:06 AM)Curiousparty Wrote: [ -> ] Have summarized the key risk factors below (might not be comprehensive)
1. Not every new airport contract secured can be as big as the HK contract.
2. Not sure what portion of the contract is earned by the partners.
3. Although iFerret has proven itself at 6 airports now, it remains to be seen how fast iFerret can be rolled out to the rest of the world.
4. Most of the contract value is for installation (i.e. capex). Recurring income needs to be built up to support valuation.
5. Although there are about 10,000 airports (commercial + military), will each of them need automated FOD eventually? Is 2% assumption for automated FOD market too ambitious?
6. Of the 2% automated FOD market, how much can Stratech corner? 30% ? 50%?

This coy has been in the SGX watch-list since 5 June 2013. According to SGX listing manual Chapter 13, Part V, 1315, it has 24 months to submit an application to be remove from such list (i.e. to say by 4th June 2015); otherwise, there might be a risk of it being suspended from trading. What do you think?

Rdgs

Page 9 of Phillip report

Regulatory risks
Singapore Exchange watch-list. Stratech has been on the Singapore Exchange watch-list since 5 June 2013, after recording 3 consecutive years of net losses. Stratech has 24 months to report a pre-tax profit and maintain market capitalisation in excess of S$40 million. Failing which, Stratech could be delisted.

Stratech has posted a pre-tax profit in FY2014, but its market capitalisation is now currently about S$30 million. Thus falling short of the S$40 million required.

*****************
a. Now, it has a market cap of > S$40mil.
b. FY2014 results showed a pre-tax profit.

(06-05-2015, 12:41 PM)KFX Wrote: [ -> ]

(06-05-2015, 11:06 AM)Curiousparty Wrote: [ -> ] Have summarized the key risk factors below (might not be comprehensive)
1. Not every new airport contract secured can be as big as the HK contract.
2. Not sure what portion of the contract is earned by the partners.
3. Although iFerret has proven itself at 6 airports now, it remains to be seen how fast iFerret can be rolled out to the rest of the world.
4. Most of the contract value is for installation (i.e. capex). Recurring income needs to be built up to support valuation.
5. Although there are about 10,000 airports (commercial + military), will each of them need automated FOD eventually? Is 2% assumption for automated FOD market too ambitious?
6. Of the 2% automated FOD market, how much can Stratech corner? 30% ? 50%?

This coy has been in the SGX watch-list since 5 June 2013. According to SGX listing manual Chapter 13, Part V, 1315, it has 24 months to submit an application to be remove from such list (i.e. to say by 4th June 2015); otherwise, there might be a risk of it being suspended from trading. What do you think?

Rdgs

(Edge Mag - 20 April 2015)

This year, Stratech won a US$36.9 million ($50 million) contract to install the iFerret at Hong Kong International Airport. The contract also includes an agreement for Stratech to continue maintaining the system for five years after its installation as well as an option to extend the maintenance work for another two years. That contract comes just a month after Stratech won a contract to install the iFerret at Dubai International Airport for an undisclosed sum. The iFerret has been deployed at Singapore Changi International Airport since 2009 and is currently being tested for its performance at Chicago O'Hare International Airport

********

HK airport figures
1) Contract M767-4 – Design, Supply and Automated FOD Detection System (Electro-optical System) for a period of 850 calendar days from 28 February 2015. The contract value is HK$199,664,310.
2) Maintenance Contract M298-4 – Automated FOD Detection System (Electro-optical System) for period of 60 months with an option of 24 months extension commencing from the date of substantial completion of Reliability Acceptance Test of automated FOD detection system for South Runway of Contract M767-4 – Design, Supply and Automated FOD Detection System (Electro-optical System). The estimated contract value is HK$79,332,620.

**********
$199.64 mil + $79.332 mil =$279 mil HK dollar
Based on current exchange rate, $279 mil HK = ~ $47mil SGD

So roughly, the 2 figures are about the same, albeit some small difference due to FX movements. tks.