As a long term holder that has believed in this stock for best part of a decade, I have to (carefully) say I am concerned with recent developments. Sure I participated in the SPP and heavily oversubscribed in the Rights issue, and in the last 6 months have eked out significant hard-earned to inch my holdings up into a few million shares.
But right now I have a queasy feeling in the stomach. For the first time in a long time, I am starting to think it is 'just possible' this speculative show might (perish the thought) not 'quite' make it. I never ever thought I would say that - and I sure hope I am wrong.
Stepping off the Merry-Go-Round and trying to observe dispassionately, I am mostly concerned about a few simple points now - the following is a mix of concerns with a few observations tossed in.
1. The XM25 is a real worry. I accept Moosey's points about differences, but my concern is not so much the physical weapon, as the technology applications going forward. Intuitively this just looks great in terms of many things, including winning the hearts and minds in conflict zones. As a MST shareholder I need serious no bull information about this competitor. The thing that is kicking me in the guts is that this XM25 is reportedly already being tested in Afghanistan? What is the mechanics of this happening? How far behind is MST?
2. How come the XM25 seems to have arrived 'out of the blue'? This suggests MST shareholders (including me) spend far too much time naively being romantic about their own tea leaves? I have been impressed with how posters to this Forum come up with obscure stuff from everywhere - but this XM25 thing gets into Afghanistan tests before we even hear about it?? Knowledge is power. What do we need to do differently? Is there anything at all we can do to inform our investment decisions going forward? I understand this is a perennial question on a speculative Stock, but.........
3. When I recently attended the displays at the LWC, I was struck by the sheer variety of defence products - no big deal here, that's just my inexperience - but I gained a better understanding of how difficult it might be to break into a boys club with something 'new' (meaning MST here). So I still give full marks for persistence here.
4. I understand the Maul uses lightweight disposable barrels (with stacked rounds inside) which therefore avoids the same rigorous Certification of the 3GL (for sustained pressures performance over many firings in a fixed barrel). Okay - this suggests the probability of MST stacked rounds technology with the Maul going forward including in the global military doorbuster/gaol/law enforcement markets etc must be absolutely terrific, with a serious prospect of much needed cashflows. The XM25 technology is of no relevance in these applications.
5. I recall that it seems the MST bosses have now had to prioritise things to the point of pushing Certification of the 3GL to the backburner while scarce funds are eked into the Maul program. This is unpleasant, but seems to be unavoidable for a cash-strapped outfit like MST.
6. BUT....... possibly my biggest concern now is that (combining points 1,2,3,5) there 'might' be a real possibility of a brilliant idea (MST technology applied to the 3GL) getting passed by and jumped over before we have got Certification completed and market lined up? Like - the firepower is clearly way better, but is that ultimately going to be enough? In a nutshell, this is where my queasy stomach feeling is restless.
7. So what is the answer to point 6? I can't really cop the lack of transparency with the Certification story any more. The obvious answer seems to have been conceded in Lee's slightly disappointing recent CEO Bulletin part 2 - it's all on the backburner because we don't have the money....? How bloody much money and time do we really need - can someone just come into the open and talk reality for a change? I don't know - but if we are faced with another round of share dilutions at .009 to raise the Certification cash (which I thought was being raised from previous capital raisings) then I imagine the prospects of Point 6 coming true must escalate significantly?
8. From my perspective, one answer to Point 6 would be to see an early takeover (not my preferred idea) to just instantly provide the cashflow to get the show into military purchase order books? Tough bikkies on the long term holders....but at least the whole show doesn't wither on the vine while I go out to inspect the choice in cane walking sticks!
9. Another thought - see point 4 above - maybe we should focus leadership on biting the bullet (no pun) and commit MST to a company that only deals in the Maul... period. Say that again.. only deals in the Maul... period. I'm certain that would be a nice little earner. This may possibly stop the rot now with share dilution (thank you) and gets the heat off the whole no funds 3GL show. Perhaps the 3GL could then maybe just tick over in a no pressure background, and more calmly see if it has a place to fit into the boys club with future refinements?
Sorry this is so long guys - but I really hope some of my thoughts are worthy of some informed debate?
MST Price at posting:
0.8¢ Sentiment: Hold Disclosure: Held
