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- Defence and space technology company Electro Optic System Holdings (EOS) has resumed a $150 million contract disrupted by COVID-19 lockdowns
- The company sent a team of engineers from Australia to an overseas delivery point to re-initiate the contract
- EOS previously encountered issues with product delivery due to border closures, travel prohibitions and the lockdown of the business and its customer facilities
- Once the delivery is complete, cash flow is expected to resume in the fourth quarter of 2020, while the backlog of products is targeted for clearance within six months
- On the market this morning, EOS is up 2.07 per cent and is trading for $5.43 per share
Defence and space technology company Electro Optic System Holdings (EOS) has resumed a $150 million contract disrupted by COVID-19 lockdowns.
The company sent a team of engineers from Australia to an overseas delivery point to re-initiate the contract, an order for $150 million in EOS products.
EOS previously encountered issues with product delivery due to border closures, travel prohibitions and the lockdown of the business and its customer facilities. However, these restrictions have begun to ease.
Airports in Australia and overseas are now operating at sufficient freight capacity, which will allow the company’s products to be exported.
Since COVID-19 hit, the company has sent over $100 million worth of products to their destinations. However, this is expected to reach the $150 million mark over the next eight weeks.
The EOS facility located in the customer’s country is crucial to support technical teams from Australia, which will implement the delivery of EOS goods and services. Originally, that facility was closed for four months, but has now re-opened.
The delivery process outlined under the contract requires the EOS products being delivered to undergo integration with the supplier’s vehicles and components.
“Despite a general prohibition on Australians travelling overseas, the EOS technical
team recently received Commonwealth of Australia approval to travel to complete the delivery process overseas,” the company said.
“The EOS technical team has arrived, passed COVID-19 testing requirements and commenced work on the delivery process,” it added.
EOS expects it will take six to eight weeks to implement the full installation, integration, safety qualification, weapon testing and physical delivery process, which was suspended in March.
Once the delivery is complete, cash flow is expected to resume in the fourth quarter of 2020, while the backlog of products is targeted for clearance within six months.
On the market this morning, EOS is up 2.07 per cent and is trading for $5.43 per share at 10:33 am AEST.
