SRT Marine Technology in the News

1st April 2007 - AIM Bulletin

SRT signs tech deals

Software Radio Technology has signed two important deals in the past month. These should just be the start. SRT, which was originally spun out of Securicor, has two main technologies and each of them could be enormously valuable.

The first technology is for Tetra-professional mobile radio. SRT's technology can be embedded in the handset to improve its performance. The Tetra standard is used in 87 countries although the US has a different standard. SRT has signed up 8 out of 11 manufacturers of these radios - all in Asia. The Chinese police and army are buying these Tetra-based handsets. In all, 4m handsets are sold each year. SRT expects to receive $30/handset in royalties as well as an upfront fee. The technology could also be used in the future for road pricing. There are two other standards in the professional mobile radio area and SRT hopes to cover all three by 2010.

SRT has signed a deal with Teltronic, the only Spanish manufacturer of Tetra radios and Selex its Italian equivalent. They are worth a minimum of $1.2m over six months. Both have been customers in the past but the deal shows their commitment to SRT's technology.

SRT also has technology that can make a marine safety/GPS location device affordable to small boat owners. The Automatic Identification System was originally developed for large vessels but the US Coastguard would like all boats to have it. The existing product costs $4,000 but SRT's technology has enabled it to develop an AIS which should have a retail price of less than $800. A deal with Saab, the market leader for AIS, will allow the Swedish company to integrate SRT's technology into its own systems. Another company that uses the technology, Comar Systems, has gained approval for its product from the US Coastguard. There are more than 10m vessels in the US alone.

Group overheads are around £4m a year and they shouldn't rise significantly above £5m over the next few years. The year end is March and SRT is expected to report a loss for last year. The latest deals should help to move into profit for the current year. At the end of March, the company raised £4m from a share placing at 42p a share. This will finance further development of the technologies as well as provide the group with additional working capital.