XTEK Ltd (ASX:XTE)’s 100%-owned US subsidiary, HighCom Armor Solutions, Inc, has received a Purchase Order (PO) to the value of US$1.1 million (A$1.5 million) for specialist ballistic armour products.
The PO has come from an undisclosed US Federal Government department, however, delivery is expected to occur over Q2 FY2022 and Q3 FY2022.
The news has driven XTEK's share price higher by 1.89% in morning trading to A$0.27.
XTEK develops and commercialises proprietary technologies including XTclaveTM advanced composite solutions and XTatlasTM real-time contextual video, which provide unique solutions for western military forces and other government agencies.
The supply and maintenance of Small Unmanned Aerial Systems (SUAS) also remains a focus.
Government support for XTEK products
XTEK CEO Scott Basham sees the PO as an endorsement of its products.
“HighCom is XTEK Group’s global armour brand, and it is the foundation of the group’s Ballistics Division,” Basham said.
“By leveraging advanced manufacturing capabilities in Columbus Ohio in the US and in Adelaide South Australia, to manufacture world-leading ultra-light high-performance hard armour plates and ballistic helmets, we provide military, law enforcement and first responder customers with world-class, advanced personal protection ballistic products and solutions.
“This order for A$1.5 million of specialist ballistic products is a great testament to the very high regard and trust that the HighCom Armor brand has with the US Federal Government.”
Orders flowing in
The HighCom PO comes just a month after, XTE received a follow-on PO worth A$1.9 million from Australia’s Department of Defence for spare parts to support ongoing operations of Small Unmanned Aerial Systems (SUAS) used by Defence under the Land 129-4A Support Contract.
XTE will deliver the spare parts in mid-March quarter in 2022 when it will be recognised as FY22 revenue.
Raise to help further improve solutions
XTE recently undertook a A$2.7 million placement, along with a pro-rata non-renounceable entitlement offer to all eligible security holders to raise approximately A$5 million.
Funds will be used in four areas of operation:
- UAVs - Development of Australian-made small VTOL Unmanned Aerial Vehicles for upcoming sales opportunities with the Australian Defence Force;
- Software - Development of the next XTatlasTM actionable intelligence software applications;
- Ballistics - Expand the range of hard armour plates and helmets made using XTEK’s patented XTclave process; and
- Working capital - Provide working capital required to grow the company’s business and meet its ongoing financial obligations for factory stock, corporate and transaction costs.