Develops antenna for commercial and military market
Subsidiary Mottech provides water management solutions
Acquired 50% of Aussie water management group Parkland
Provides services for sectors including wireless and mobile internet
What MTI Wireless does
MTI Wireless Edge Ltd (LON:MWE) develops and produces high-quality antennas for the commercial, radio-frequency identification (RFID), and military markets.
The company’s products can be used for wireless and mobile internet applications, while its military hardware encompasses a wide range of broadband, tactical and specialised communications antennas and systems.
The group’s Mottech Water Solutions provides water management systems for agricultural irrigation.
How is it doing
The antenna maker reported that for the three months ended 31 March pre-tax profits had risen to US$560,000 from US$250,000 previously, while revenues had jumped 16% year-on-year to US$9.1mln.
IFrameEarnings per share increased 54% to US$0.64 while the company ended the period with a cash balance of US$5.25mln compared to US$3.45mln last year.
Zvi Borovitz, MTI's chairman, said that since the start of the year the company had seen “significant growth” in its order book with four large contract wins that totalled over US$6mln.
Parkland Australia will cost up to A$0.8mln and made a A$0.24mln profit before tax from revenue of A$2.1mln in the year ended 30 June 2018.
What the company says: Richard Bennett, Non-exec
"Parkland gives Mottech a platform to expand into Australia.
"Mottech is about getting water to the right places at the right time.
"Australia is a large agricultural country that needs water in the right places and Parkland gives us a platform to drive sales hard in the country."
- 5G antennas are potentially a huge market for MTI
- Mottech has just signed a three -year deal in China, which is poised to become its largest market
- At 22p, MTI is valued at £19.2mln
What the broker says
Ed Stacey of Capital Network increased his revenue and earnings per share (EPS) forecasts by 1% for 2019 and 2% for 2020 to reflect the acquisition of Parkland.
Strategically, the acquisition expands MTI's presence in Australia, a major global market for smart irrigation.
“We believe that the largest markets for MTI in the irrigation space currently are Israel, North America, South Africa, and China, with Australia adding a potentially significant new avenue for growth.”