Sydney-based advanced carbon fibre composite manufacturer, Quickstep Holdings has posted a full-year maiden net profit for FY2019, with export sales booming to support ongoing growth.
In a company first for the independent manufacturer of advanced carbon fibre composite components, Quickstep Holdings has announced a $2.7 million profit for FY2019 on total sales of $73.3 million – this growth marks a 24 per cent increase on the $59 million sales announced in FY2018.
This net profit after tax (NPAT) of $2.7 million represents a $5.6 million improvement on FY2018 and includes a earnings before interest, tax, depreciation and amortisation (EBITDA) and a $1 million tax benefit reflecting future taxable income.
Mark Burgess, CEO and managing director of Quickstep, said, "In FY2019 we delivered across all key metrics and shifted the business to sustainable profitability amid continuing growth. This marks a significant turning point for Quickstep."
This also marks the first full year the company has enjoyed a positive operating cash flow – Quickstep's operational and financial turn around has been driven by a number of key factors, including:
- Production of parts for Northrop Grumman for the Joint Strike Fighter Project;
- Production of C-130J wing flaps for Lockheed Martin;
- Production of parts for Joint Strike Fighter vertical tails for BAE Systems and Marand Precision Engineering;
- Manufacturing and development of parts using Qure technology; and
- Continued development of technologies for scaled volume production.
In particular, revenue from Quickstep's F-35 Joint Strike Fighter contracts rose 37 per cent to $53 million in FY2019 from $38.6 million in FY2018 – JSF revenues are expected to increase further in FY2020, at a more modest rate – reaching full-rate production over the next six-to-nine months.
Further to this, Quickstep's production of C-130J Super Hercules flaps continued at the long-term rate of two ship-sets per month – supporting Lockheed Martin's delivery of the key capability.
Quickstep's relationships with Boeing Defense have continued to evolve, with the company manufacturing components for both the F/A-18 and F-15 programs – while introducing production of accessibility ramps using Qure technology for Lockelec, supplier to a number of Australian rail operators.
"What we have done over the past two years is to provide a firm platform for the future growth of Quickstep and the company's results for FY2019 show that not only can we deliver on the contracts we currently have, we intend to go out and win more," Burgess told Defence Connect.
Quickstep has seen significant improvements in the company's gross margin in FY2019 – with a gross margin of 22.3 per cent, up 6.5 per cent on FY2018 – which has been achieved through a combination of efficiency gains, process improvements, economies of scale and cost reductions, despite a challenging operating environment following a three-month repair of a piece of key production equipment.
Burgess explained to Defence Connect, "These FY2019 results set the tone for Quickstep moving forward – we are focused on the next five years, pursuing and winning further contracts and ensuring that these contracts are measured against the company's strategic objectives."
The company plans to accelerate its business development activities to win additional business through its tiered growth strategy, focusing on key areas, including:
- Core defence aerospace: Increasing revenue and diversifying the company’s customer base within the defence/aerospace sector, utilising existing Bankstown facilities while expanding core capabilities.
- Aerospace Qure/advanced manufacturing deployment: Strategic growth within the aerospace and other sectors, using Qure and innovative technology solutions to attract new business opportunities.
- Step-change growth: Step change to commercial aerospace supply. Securing of large global programs and/or inorganic growth across the wider defence, commercial aerospace and automotive industries.
Quickstep is an independent aerospace‐grade advanced composite manufacturer in Australia, operating from state‐of‐the‐art aerospace manufacturing facilities at Bankstown Airport in Sydney and a manufacturing and R&D/process development centre in Geelong. The group employs more than 200 people in Australia and internationally.