AL3 appoints retired US Navy submarine Rear Admiral David Goggins as a US board advisor

Our 3D metal printing Investment AML3D (ASX: AL3) just appointed retired US Navy Rear Admiral David Goggins as a US board advisor.

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AL3 sells 3D printing systems that produce complex metal parts - faster, stronger and cheaper than traditional casting and forging (this is called additive manufacturing).

As of today most of those systems have gone into the US Navy's shipbuilding and submarine supply chain, so this is primarily where AL3's order book is being built.

(Although there have been orders and installations in other areas other than defence, including into US utilities and the tech is applicable to areas such as aerospace, oil and gas and more broadly energy.)

So bringing on someone with 34 years of experience is a strong fit given AL3’s current customer base.

Goggins actually spent 34 years in the US Navy leading the design, construction and sustainment of nuclear-powered submarines.

He served as Program Executive Officer for Attack Submarines, effectively the admiral overseeing US attack submarine construction.

Before that he was the Virginia-class submarine program manager (overseeing the delivery of three submarines) and also worked on the next-generation Columbia-class ballistic missile submarine program.

Most recently, he was the US Navy's Special Assistant for the AUKUS partnership where he led the US side of the trilateral Australia-UK-US submarine effort:

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In other words, he has spent his entire career inside the exact corner of the US defence world that AL3 is trying to sell further into.

AL3's biggest orders to date have specifically been submarine-related, these are the most recent 2 orders that we covered in articles.

A $9.9M order from Newport News Shipbuilding with America's largest military shipbuilder, which builds aircraft carriers and submarines, this took that customer's ARCEMY fleet from 2 to 6 systems in around six months.

That customer? Newport News Shipbuilding, a division of a division of $16.7BN HII (Huntington Ingalls Industries), one of the biggest defence contractors in the US.

A $2.6M order for US Navy submarine parts was for the manufacturing of five components that are no longer supported by their original manufacturers.

AL3 already supplies parts under AUKUS, and AL3 made not of the expanding operations in the AUKUS hubs of Perth and Adelaide:

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Goggins actually ran the US attack submarine programs and then led the US side of AUKUS so no doubt he knows the people, the programs and the procurement pathways AL3 is trying to win work from.

This follows on from AL3's earlier appointment of Larissa Smith, the former Director of Additive Manufacturing for the US Navy.

We covered that and the March quarterly here: AL3 ends quarter with $29M of orders in hand and $26.5M cash.

That appointment puts someone who recently sat on the customer's side of the table onto AL3's side.

Of course, an advisory appointment is not an order.

Relationships can open doors, but defence contracts still have to be won and government-linked deals can take a lot longer to be actioned than anyone would expect.

But it does put AL3 in a better position to continue to land more contracts and contracts bigger in size.

What we want to see next from AL3

More US Navy system sales 🔄

With 100 systems forecast across the Marine Industrial Base and only a handful deployed so far, the pipeline from HII alone may become substantial.

We want to see more orders from the six US naval base companies named in the Navy's LOI. (source)

AL3 now has 2 recent appointments from the US Navy, so we would expect more doors to be opened and discussions taking place, hopefully this results in increased contracts.

US facility expansion 🔄

AL3 is investing $12M to expand its Ohio production capabilities which is required to keep up with its growing sales.

The additional four systems ordered by Newport News systems will ship from its Ohio US technology center.

UK and European market entry 🔲

AL3's CEO has flagged early-stage demand in their UK and European markets and we think that NATO's 5% GDP defence spending target could create a new wave of opportunity.

Back in April last year AL3 announced it had started alloy testing with BAE Systems (capped at 123BN who are a multinational aerospace, arms and information security company), so we are hoping successful testing leads to sales into the UK/EU…

Ultimately, we want to see AL3 make a first sale into Europe or the UK.

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