Having a good understanding of MSP I have started collecting my thoughts on FFT. Once I have a good understanding of both I will join the two operationally and financially as I see it and reveal my findings. But for now in the spirit of getting some investor chatter going I will let you know some of my findings to date.
A mate mine happens to be a Dr in the field of optical physics...... Optical physicists in Australia are a small group and as such knows Dr Jim Katsifolis – Vice President, Research & Development. As an optical physicist, he was pretty impressed with the wide adoption of FFT's technology. I asked him how long does it take to out date such technology. He said at least 10 years ....so its not like phone that gets superseded every 12 months. This 10 year window got me thinking, when was the Australian Exporters Award? It was 2010. But it's now 2018!!!! Fortunately this date has been pushed back significantly with recent updates.
24 January 2017 FFT’s investment in R&D yields new product platform - Aura Ai-2 Future Fibre Technologies Limited (ASX:FFT) (“FFT” or the “Company”), a global leader in fibre optic perimeter intrusion detection systems, today announced the successful results of its recent Research & Development (R&D) efforts with the commercial release of Aura Ai-2 – a new product platform featuring extended detection range, enhanced intrusion location accuracy, and cut resilient capabilities.
With the product updated I wanted a greater understanding of market size. FFT before MSP was a business dedicated to three streams:
*detect and locate perimeter intrusions;
• identify third-party interference on oil and gas pipelines; and
• protect sensitive data network communications cables.
First line of business - Perimeter Intrusions
*In FFT's 2015 prospectus page 9, it states that
Broader Perimeter Applications
"FFT has secured 4% of the global "perimeter security" market which comprises of of buried (seismic and volumetric), embedded (taut wire, smart basrs and electric shock) and fence mounted fiber optic copper technologies, a markest estimated to be worth $273 million. "
This seemed light and a market so small why would you bother, and if the market was that small, why would you want a one off sale, at least get some form of recurring business. Could the market perimeter intrusion detection be so small when perimeter security systems are expected to find major applications in the transportation end-use segment, especially at airports, railway stations and sea ports, militarized zones and border protection ?
Taking just one country the US and one industry, airports there are 457 commercial airports that could benefit from perimeter intrusion detection considering the threat of terrorism and public safety. Although this film is from 2011 of the US parliaments oversight of the TSA (Transportation Security Administration) the first 5 minutes alone provides some good insight into the market opportunity whether that be the US or anywhere else in the world.
Fitting out the US Airports alone would be around $400 million .............in the video it states 87% of all airports have not done a proper threat assessment and large sections of JFK were left without a fence for long periods.
Here is how I came up with with $400 million (just for US airports) in back of the coaster stuff
Sydney airports 19km fence is around 19 km ..........
View attachment 916016
It appears FFT sells cable at about $46,000 per kilometer (See the 11th August 2017 Announcement below - this announcement is a buried treasure)
Consider the FFT airport win back in March 2017 (see below) for a middle east airport contract worth $1.176 million and you can see each airport would have overall average of around a $1 million dollars. Slice a bit off the top for conservancy and then you have $400 million just for US's 457 commercial airports alone. Dont forget military.
Corporate Video
The announcement was not market price sensitive ....but if there is an expansion of this pilot to full scale it will be a substantial.
View attachment 915983
View attachment 916061
(20min delay)