Space, communications and defence manufacturer Electro Optic Systems has become the latest in the sector affected by Covid-19 to go to the market seeking new capital from investors.
The company will seek to raise $144 million from a fully underwritten placement to institutional investors and a share purchase plan, with the company noting some disruption to its mainly-exporting business.
The Canberra company said no customer had indicated any intention of cancelling its orders, which are mainly long lead time contracts for communications equipment and remotely controlled weapons systems.
EOS’s $3 billion order pipeline remains unchanged, however the company now believes $9 million in EBIT profit expected this financial year will now accrue after June 30.
EBIT guidence has been revised down accordingly to $27 million.
EOS said Covid-19 had disrupted delivery of $60 million worth of product and payment were being delayed.
The company will continue production on these orders until July, partly funded by the capital raising.
“To mitigate potential impact of Covid-19 on Australian production, EOS has divided its single shift into two equal parts which do not occupy the plant at the same time.
“This arrangement has temporarily reduced output by 20 per cent, however adjustments are in process to restore output without reducing staff protection levels.”
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