Quickstep Holdings Limited (ASX:QHL) CEO and Managing Director, David Marino discusses the company’s biggest growth opportunities and outlook at the ASX Spotlight Series 2016, New York Quickstep Holdings Limited
(ASX:QHL) is participating in the growing carbon fibre market. We are an advanced manufacturer of aerospace and automotive components. And we provide some of the biggest global customers in the world, like Lockheed Martin Corporation (NYSE:LMT), Northrop Grumman Corporation (NYSE:NOC), BAE Systems PLC (LON:BA). We have two fundamental divisions. One, which is an aerospace manufacturing division that actually produces aerospace defence components, and a new technologies division that has actually got some disruptive technology, to service the carbon fibre industry as well.
The focus for the company is actually to penetrate those global supply chains, and be able to take advantage of that growing market space, in the carbon fibre industry. So we’ve got some very strong contracts already for the Joint Strike Fighter program, which is ramping up in volume over the next two or three years. We also produce wind flaps for the C130 Hercules bomber.
We’ve got a number of new contracts that are servicing the defence industry, Thales (NYSE:RTN) and we also make some automotive components for Ford (NYSE:F). But the other part of our business is really looking to take our new technologies, which has two particular patented technologies called Resin Spray Transfer and cure. And actually use those technologies to manufacture parts globally, in those global supply chains.
The competitive force really is that carbon fibre is such a significant and growing marketplace. There’re a number of new technologies that are trying to deliver the volume production that’s going to be demanded in the automotive industry, in particular from a carbon fibre perspective. So we are taking our cure and RST technologies and we are industrialising those technologies, to be able to deliver volumes beyond the 10,000 units per annum, at this stage. And we have got some interesting new approaches to be able to deliver that to the marketplace.
Some of the other competitive forces are the material types. So carbon fibre is really competing against light strength alloys, aluminiums. Our view of that is that there’s such a demand for lightweight and given the global environment requirements of CO2 emission reductions, in a lot of the major aerospace and automotive producing areas of the world, that I think those competitive forces have enough space to play with one another.
The biggest opportunities for growth really and we’re very focused on both the aerospace and automotive swim lanes. The market predictions suggest anywhere between a 60 per cent and 80 per cent growth, in those industries over from 2014, really to 2020. So our market space that we’re really looking at is electric vehicles, the lightweight in reduction in electric vehicles is required to be able to get the battery range technology right.
We’re looking at improvements in truck, given the demand of truck and SUV in the marketplace. We think there’s great growth in that space. We also think there’s fantastic growth in the UAV and light commercial aerospace markets. And today we’re all moving around in the globe, far more than we were maybe five or 10 years ago. And therefore, commercial aircraft is another significant market play for us.
I think we’d like to see the company take advantage of the growth space. We’re in the commercialisation mode of our new technologies. We’d like to be participating in those new and innovative programs that a lot of the aerospace and automotive customers, are actually driving now. We’ve got a number of interesting opportunities that we’re working on with those customers. We’d also like to see our manufacturing activity that we’ve been working on for the last three to five years, really take advantage of the booked programs that we have. And really create some efficiency and return in the business.
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