Structural Monitoring Systems (ASX: $SMN) Update

Structural Monitoring Systems Plc (ASX: $SMN) has forecasted a maiden quarterly profit for the June quarter of FY2024. The company anticipates annual revenue of $28.38m, reflecting a 27% year-on-year growth, and a Group EBITDA of $3.38m, a significant turnaround from the previous year's LEBITDA of $0.27m.

Chairman and CEO's Comments

As we approach the end of the current financial year, I wanted to give you a short update on current performance and our planning for the next financial year and beyond ahead of the release of our next quarterly report at the end of July. We are now confident of exceeding our revenue forecast for the current financial year, despite having to defer our expected CVM™ sales due to the testing delays with the Aft Pressure Bulkhead (APB) application. Our Contract Manufacturing segment has performed strongly this year, and the team were able to bring forward production to both offset the CVM™ revenue shortfall and take advantage of this segment's shorter 'production to cash' cycle to support our cash flow at a difficult time. Equally significant, and even more important for the future, our Avionics segment developed some real sales traction, particularly in the current half year, as demand for our new Forest Radio product begins to materialise.

Summary of Forecast and Outlook

Structural Monitoring Systems plc anticipates a strong conclusion to the financial year, with increased avionics sales expected to drive the company to record a quarterly profit for the first time in the June quarter. The company's Contract Manufacturing segment has shown robust performance, offsetting the CVM™ revenue shortfall and supporting cash flow. The Avionics segment has gained sales traction, especially with the new Forest Radio product. The company is confident in exceeding its revenue forecast for the current financial year and is well advanced in preparing the budget for the next financial year and five-year forecasts. With a focus on profitable growth, the company aims to position itself as a global entity with a refined corporate narrative and a clearer link between its corporate entity, wholly owned subsidiary AEM, and its three separate business segments.