Precision Global Aps

Development in activities and financesThe result for the year before tax amounts to a profit of DKK 34,798k compared to a gain of DKK 1,539k last year. This is considered very satisfactory, and also reflects the geo-political situation and the huge expansion within the sector as a whole.

Regarding the balance total of the Group - one Group company has approx. 62 million DKK in cash deposit in Lloyds Bank at the closing date. This amount was not transferred to the parent Company on the closing date but was transferred immediately afterwards. This means that it was the management of the GRoup's intention to lower the balance sheet value with DKK 62 million. If the transferred was made the equity ratio would have been 27,6% instead of 18,6%.

The overall status of the company group is very positive. The Defence industry is growing and the demand for additional government spendings within the sector seems extremely positive for the years to come. Throughout the corporate territory, defence budgets and spending are being heavily expanded. This is expected to continue throughout the next five to ten years, as the geo-political situation is not likely to change and as the NATO and Coalition countries finally seem to realize that they have neglected to invest in the national defence and security for the past decades. Hence, there seems to be a huge potential for the sector and company in the years to come. The security situation as well as the lessons learned from the global pandemic, does encourage the European NATO partners to prioritize local industry initiatives, but the urgency of time as well as alliance interoperability, on the other hand calls for procurement of US defence articles, which are still considered the most advanced and trendsetting. In addition, the US is trying to optimize the availability of defense related articles by lowering the export restrictions to main NATO partners. In addition, the US is allocating funds to new and smaller economy partners in NATO. These funds are dedicated towards procurement of US defence articles. Such procurements must be conducted government to government but can go into a tender process on the US side, which opens up the possibility to utilize a US based entity to obtain such opportunities.

The new Precision Technic Defence Group addition of the US entity, which was incorporated late 2022, is being very well received by the US partners, however full implementation is a on-going process both externally as well as internally. It will, however, make corporation with the group more attractive for US suppliers as well as optimize the internal processes and intercompany resources.

The Group result is still negatively affected by challenges in some young and “unmature” enterprises. The result is however still supporting the continuous growth of the Group.

Throughout the underlying companies, we have seen growth and activities picking up. Results in the Australian
and has been satisfactory, however result in the French and German companies have not. In the German company, there is a lot of on-going activities and longer terms opportunities, whereas the French company is extremely challenged. There is a focus on pipeline generation, budget planning and execution as well as continuous effort on implementing procedures and processes to streamline organization as well as activities. Main effort for FY 2023/2024 will be to prepare the German organization for the FY 2024/2025, which is looking to be a turning point for the entity.

In FY 2022/2023, a professional Board of Directors has been implemented to assist the governance and business development. As a result, strategies for each entity have been defined as a foundation for the budgeting process and a new focus on best business practice has been initiated. The Board of Directors is run as an active board, which - amongst others – means an active and high intensity engagement.

On the corporate level, main effort has been to ensure that the corporate structure is enabled to support the growth strategy. The Group has teamed with AP Pension in order to this pension fund to finance and build the new headquarter for the Group which - amongst others – ensures that the company liquidity is being made available to finance the continuous growth strategy.

The Group will continue to implement the three strategic initiatives being growth and financial robustness, additional service and support offerings on deliverables and the sustainability agenda. This includes implementation of new initiatives within Environmental, Social and Governance (ESG).