just watched the presso at NWR comms. some good detail mentioned...

just watched the presso at NWR comms. some good detail mentioned for the first time (AFAIK). a few notes not in the written presso:

• Forever pipe revs of $6m was up 40% yoy. The product offers significant cost, uptime and safety advantages over legacy product. New products were coming (eg, T joints), and now exporting to middle east (was just a trial at the interims as I recall) but Mark M had previously said this was a 10s of millions market, not 100s of millions.
• Covid had slowed roll-out of gyros. now getting increasing enquiries, and as many leads for big gyros than small ones. Veem had developed a new more powerful gyro (750 Nm vs 520) using mostly the same components as the current largest model.
• Mark M thought they had passed the inflection point in developing gyros during FY21. Said they now had four key capabilities: design, Sales, supply chain and manufactrg. Given they have no current competitor, that sounds like a significant (and hopefully enduring!) competitive advantage. They were also building gyro service teams in offshore markets- Europe first, so should maintain good service and customer responsiveness.
• Now moving to a planned Gyro production plan c/w a reactive model. Expect efficiencies, including thru better sourcing and greater experience/specialisation.
• strength of prop sales growth and opportunity was a surprise to me. I previously understood prop sales were around $15-16m pa. Production capacity had increased 45% but Veem still felt their time to deliver times were longer than they would like. New machines were coming later this year. They were making (IIRC) 300 props a month, and might get to 500-600 from current site. largest customer had doubled orders from 1000 pa to 2000 pa. Also an increasing level of commercial props, these were stickier customers (and harder for the competitors making props by hand to compete). seemed to be more confident in their ability to target smaller prop market - had not increased their prices for some time, but costs were falling! Impressive. As a result, more bullish about competing with low cost SE Asian prop manufacturers at the low end (this might overstates things, it was a turnaround from comments at the interim IIRC).
• Also doing R&D on shaftlines seeking to develop new technology. They seem to see an opportunity (I imagine there is a complementarity given VEEM's strength in props, but VEEM seem to be mostly targeting some technical innovation).
• good level of defence work on the books, and good ongoing support from Aust Fed Govt, some opportunity for (prop?) sales to Canada military.
• some examples (defence and some gyros (i think)) of people paying cash before revenue was booked. that is an endorsement of VEEM, its products and general reputation I think.

In a nutshell, a terrific year for VEEM which seems to be firing impressively on all cylinders. GLTAH