AL3 Gets Milestone Payment
Today our 3D printing Investment, AML3D (ASX: AL3) has announced that its industrial-scale ARCEMY 3D metal printing system ordered by US defense contractor Cogitic Corporation has been successfully commissioned and is now operational.
Cogitic is a supplier of componentry to the US Navy’s Submarine Industrial base and specialises in complex parts and assemblies.
As we said in our initial note on our AL3 Investment, there are layers to the “onion” that is the US defense industrial base.
AL3 is aiming to push out from its core client in the US Navy to the rest of the supply chain:
At the centre of the onion is the US Department of Defence, which are fed by major defense contractors that provide machinery and services and then finally are the broader base of smaller industry participants.
So we see today’s news as further evidence that AL3’s strategy is working.
We recently visited AL3’s site in Adelaide as well - read our coverage of our site visit below:
We think there is plenty more to come from AL3 as it approaches the opening of its new manufacturing hub in Ohio…
How does today’s news impact our AL3 Investment Memo?
Objective #1: Hit $12M in revenue
According to the March quarterly AL3 will hit ~$7M revenue for FY24
We think that if they can back that up with beating $12M revenue in FY25 it would be a huge result.
Source: 27 June 2024 AL3 Investment Memo
Milestones payments like the ones triggered in the announcement from AL3 today should only accelerate as AL3 gets closer to the action in the US.
AL3 has now triggered the payment of 50% of the order value which was $2.5M.
That $1.25M payment will now enter the AL3 coffers, which advances our #1 Objective for AL3 from our AL3 Investment Memo.
What’s next for AL3?
🔄More sales to US Navy pushing out to wider US defence industrial base (ongoing)
🔄Opening of Ohio facility (next 3 months)
🔄Expansion into new industries with new clients (such as Oil & Gas, aerospace)
🔄NEW: First product sales from Boeing agreement
