SRT Marine Systems – after hitting all-time 67p High, the group’s shares have eased back on slight profit-taking, however at 59p we are near a new ‘break-out’

20.05.2025

After hitting 67p last Thursday, a new all-time High, the shares of SRT Marine Systems (LON:SRT) have eased back to 59p, a level from which I feel they are ready to break strongly upwards.

I still see the shares hitting 100p in 2025.

All it needs now are fresh items of corporate news to get them on the move again.

And that could well be just around the corner.

The Business

The £152m-capitalised Midsommer Norton-based SRT is an established leader in the rapidly developing global maritime surveillance and navigation safety market, which is now entering a long-term phase of rapid growth.

The group has the world’s most sophisticated integrated persistent maritime surveillance system for national-scale deployment by sovereign agencies.

SRT is delivering a new horizon of maritime surveillance and awareness that enables the realisation of effective and efficient intelligence-lead operation doctrine.

Its technology-driven products and systems enable marine stakeholders from nation-states to individual mariners to enhance their marine domain awareness and improve surveillance, intelligence, safety and security at sea, in ports, along waterways and coastlines.

Leading the new generation of maritime security, safety and sustainability

From national agencies such as Coast Guards to infrastructure owners and vessel operators, its technologies and systems are being adopted and rolled out globally, enabling a new era of maritime security, sustainability and navigation safety.

Coast Guards - Integrated national scale Dynamic-Ai powered systems that deliver a new horizon of maritime surveillance capability.

Fisheries - Professional fisheries monitoring and management systems that enable effective and efficient management of national fleets and IUU detection.

Ports & Waterways - Sophisticated devices for infrastructure that support the next generation of digital navigation.

Vessels - Communication devices for vessels that enable commercial and leisure vessels to operate more safely and efficiently.

Robust, Reliable, Proven

The marine environment is harsh, every SRT product and system is extensively product-engineered, manufactured and installed to operate reliably for many years in such environments.

Multiple features from the use of high-quality materials to embedded design features that mitigate the effects of shock, temperature, salt, water etc are found in every SRT solution.

The result are products that customers trust to perform with relentless reliability.

Maritime Domain Awareness?

MDA entails the gathering of information and intelligence relating to any ship or vessel navigating within a country’s maritime boundaries.

By harnessing this wealth of data, a more complete understanding can be derived, and specifically around those maritime regions that pose potential threats to safety, the environment, and a nation’s economic interest.

This process is commonly referred to as ‘actionable intelligence.’

Through the application of actionable intelligence, authorities are empowered to effectively enforce maritime laws.

Furthermore, MDA plays a pivotal role in addressing a wide spectrum of issues, including anti-piracy, the interception of drug smuggling activities via maritime routes, and the prevention of other illicit endeavours associated with marine transportation.

Massive Order Book

At the last reported account, the group had some £338m systems business under contract, while it has a potential pipeline of £1.2bn of new prospects.

Commenting upon the Half Year Trading Update, issued on Thursday 27th March, Simon Tucker stated that:

"I am delighted with our operational and financial performance during the first half which is rooted in many years of hard work to build up our technologies, products and global market position.

As we expected, we have seen solid revenues from both transceivers and systems divisions and look forward to continued growth into H2 and the years ahead."

The group’s Order Book of £338m worth of ‘active system projects’ is due to be implemented over the coming two years, with the added buck of ongoing support contracts stretching between five to ten years thereafter.

Like any Finance Director, I just love to see recurring revenues, and that is what follows on from systems delivery.

The Equity

There are some 249.9m shares in issue.

The larger holders include Hargreaves Lansdown Asset Management (8.75%), David Brierwood (8.22%), David Newlands (2.13%), Barclays Bank Private Banking (1.87%), Amati Global Investors (1.54%), Toscafund Asset Management (0.52%), HSBC Global Asset Management (0.51%), Jarvis Investment Management (0.27%) and iDealing.com (0.25%).

My View

Awaiting the end of the company’s trading year to end-June, analysts are waiting to cast their slide rules over the balance sheet.

I really like this little company – after the last ten years of development, its potential is absolutely massive.

And that will see significant profits rolling into the group’s coffers.

Awareness in operation

Canny investors, prepared to take a committed view on the stock, should be ready to add even more to their holdings if the shares fall back from the current 61p.

(Profile 14.09.20 @ 39.5p set a Target Price of 50p*)

(Profile 10.11.23 @ 39.75p set a Target Price of 60p*)

(Profile 25.04.24 @ 22p set a Target Price of 35p*)

(Profile 31.03.25 @ 60p set a Target Price of 100p)