|I did and asked Martin some of your questions from your previous post. |
TACNAV has a pipeline of over $100,000,000. AMPV alone is at least $30-50 million, and KVH is already in it, so I didn't ask why they are still in this business. The answer is obvious. Production ramps up next year and runs for many years. JLTV is also a good possiblity and is many more vehicles. The foreign orders still are expected this year (again). A highly profitable business and I would imagine, much steadier after more level contract production and delivery begins.
Non-disclosures with all the autonomous vehicle manufacturers prevent naming any customers, but they are in a lot of them. MEM's does not meet the requirements for time, temperature and reliability. FOG's are an order of magnitude better meeting technical requirements, if I was not mistaken. They are working to get their component down to $200 per unit where the manfacturers seem to be quoting a desired price for FOG's. Lidar and visual systems cannot meet all the requirements alone, they do not work well in rain and other conditions.
Their antennas can handle HTS without modification. They would just need to provide a newer modem. A lot of the previous HTS costs were outsourced, and by bringing them in house through hiring, they were able to cut costs in half. Cruise ships could become big after HTS introduction. Right now, they use huge antennas to handle all the bandwidth required for thousands of passengers. Companies like Harris do that. KVH does supply their NewsLink service now.
I believe that some of the Agile plans run as low as $50 per month. I asked how they make money at this level. They are getting people on board and there is not a lot of data at this price. Obviously, they are trying to get them to upgrade or use more. The plans are well received considering there are no hardware costs. I asked what happens if everyone starts wanting these systems (KVH incurs hardware and installation costs up front) and if they can handle a huge demand. Obviously service revenues will go up too and they have ways of scaling back demand (higher plan costs) if things get out of hand. A good problem to have, I guess. The new CFO is on top of this and they seem to be in good shape financing wise. EBITDA seems real good, so they have the cash flow and the cash to do this and to pay down existing loans. Open plans are 60% of their business and are higher margin.
Worldwide shipping and Oil & Gas continue to be a difficult market. Most of their competitors are losing in a bigger way, so KVH is best of breed here. Offshore wind is increasing, a new area I have not heard about previously.
The impact of the British pound has been a headwind all of this past year. Starting in July, comps should now become favorable due to the valuation of the dollar/pound relationship. New systems are priced in dollars.
I may not have remembered everthing or taken enough notes, but look into rignet and assured PMT, as further points of interest. There were two small funds present with new positions and asked questions as well.