http://www.theaustralian.com.au/business/opinion/alexium-turns-up...

http://www.theaustralian.com.au/bus...eat-with-us-deal/story-e6frg9lo-1227583146321

Alexium International (AJX) $1.03
Alexium’s Washington, DC-based CEO Nick Clark can’t be accused of not being close to his customers, having huffed and puffed his way through the weekend’s invitation-only Marine Corps Marathon with 30,000 military personnel.
Soon many of these sweating soldiers will be donning uniforms treated with Alexium’s fire-retardant treatment, Alexiflam.
In a long-awaited development, Alexium has been awarded preferred supplier status by the procurement brass at the Department of Defence, which normally goes out of its way to use US suppliers. In this case, the military had little choice because Alexium is the only supplier of FR coating that isn’t based on the toxic bromides that are in the process of being banned.
The DoD will fund up to $10 million for “real-life” field tests, although we’re assured no soldier will be deliberately ignited.
“This is a big, big deal,’’ says Clark. “The beautiful thing is this validation opens up a global military market.’’ The Alexiflam coating is applied to a 50-50 cotton and nylon fabric, NyCon, capable of withstanding 100 washes compared with the current standard of 50 cycles.
Alexium cites a $US240m ($330m) global market for uniforms, which in effect refers to friendly global forces.
As far the US deal goes, the release is deliberately vague.
But Clark estimates there are 300,000 to 400,000 army personnel, translating to $20m-$40m of annualised revenue for Alexium.
Alexium’s FR formulation is already used by the Rhode Island-based Murdock Webbing, which makes webbing for military applications, such as parachutes, duffel bags and tents.
Alexium’s greater potential lies with industrial applications, with the company recently bedding down a deal with an unnamed US mattress maker.
Clark says the Murdock and mattress contracts combined should generate at least $1m of monthly revenues “by the end of the year”.
Criterion last rated Alexium a spec buy at 88c on September 8, after the Murdock deal. With Alexium’s market cap approaching $300m, our enthusiasm is quelled for the time being. Hold.