the call: Tuesday 6 October

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1:10Ten stocks, people are here to experience one hour. It is Tuesday, 6th October. I'm Eric Agen. Thanks for joining us. Also joining us today. A really cool pick of that and die from FN Arena. And Sean Hietman from Market. Managed gentlemen, welcome to you both. Nice to be here. Well, positive day on the market as we record this. But Sean, interesting to see what's going on. And we see very much a focus on where those bond yields are going at the moment. Despite that, Wall Street record. Another record. More records coming. It's sort of counterintuitive, isn't it? Well, it's a bit of an arm wrestle. In the US, Sean bond yields are a headwind. But their earnings, albeit in a very small number of stocks, are looking great. The earnings across the S&P 500 are solid. Or in a few stocks. It's enough because they're big trillion dollar companies. He says the market over there, believe it or not, is actually cheap on a historical basis. Very, very different capital of fish here. Earning is on as good. You take the miners at the equation.

2:10Earnings are negative this year. So it's two different markets. And we have to just pick our way through that. One of the things really, and I will help you do today. There are places to be. Places not to be, and maybe places that we should start looking at as a market evolves. But bond yields. I've got an Alim here. I think they're very close to a top. They've got bad, is that going to get historically the oil price has led bond yields for obvious reasons. And the old, you know, the bond yields keep making new highs. The oil price is starting to wobble up here. It's not falling. But it's not making new highs. And when you get that sort of divergence, it often is top of the bond market. There you are. Top of the bond market. Top of the bond market for yield. It's not price. It's not price. Just after midday, and Shaun's calling it. Really, in fact, we were talking about this on. When we recorded the investment to many of the latest episodes, the local market. Opportunities. Elevated levels of cash at the moment. In reserve, ready to deploy. What would actually trigger your sort of buying?

3:12I mean, is it stock pickers market, but nonetheless. When would you indicate to you that it's perhaps turned? Oh, it's a difficult one. But I like Shaun's. We're here to help. Yep. We are. Not it's not advice. No. Bont yields are probably, but Bonser probably going to be the trigger. But this disclose out from the midterm elections. It would appear that the bond yields are not coming down yet. I think it's, if the Democrats win both houses in particular, I think the bond yields will probably come down that we'll out and expect. The other interesting thing is that, normally, midterm elections in the US weigh on risk assets. As you just said, we had a little bit of a sideways move since four weeks, but we're now seeing new highs in the Nasdaq. So maybe US investors are getting quite comfortable with predictions that the Democrats might be taking full Congress.

4:15Just saying. I mean, I think the market, the way it's feeling at the moment, feeling is not particularly technical phrase. If the bond yields stop going up, it might be enough for the market to go up. Yeah. We probably need a little bit more in Australia because we don't have the growth. And the growth will probably have to come from a relief on Bont yields and the reserve bank. We might be a little bit away from that yet. But I'm hoping, because we're having here a one-third, two-third market. I'm hoping that if the US well isn't a year-end, we might lift as well. Well, certainly that risk going into the midterm, interesting effect. I caught up with Steve Solstein from Intractor Brokers this morning and he called it not so much likely, blue wave. Does he want to have it more like? No, he's calling it a red undertow. Okay. So the problem is that we dragged under rather than the Democrats coming out of the top. Anyway, we'll see how that eventually works.

5:16Let's now turn to our stock of the day. Now to be honest, not a lot of corporate news out today, but so much discussion about data centers, in particular, that forthcoming IPO from firmness. We thought we'd take a look at the Southern Cross electrical engineering there. It shares climbing to a fresh, old time high on Monday after McCory initiated a coverage with an out-perform rating. McCory highlighting it's roughly $1 billion dollar data center pipeline with the upcoming firmness IPO putting further focus on that massive investment required to build out the Strait as AI infrastructure. It comes as firmness as major Australian data center partner, CDC data centers, is ending an agreement to work on a pipeline, valued at more than $73 billion. That's the current report this morning in the AFR just a year after its sign, the head of firmness is listing on the ASX. So in fact, it shares coming off today. Off the back of that move yesterday, Rudy, let's start with you, as we will know,

6:19data centers, all the rage at the moment. Southern Cross, of course, you could talk this as sort of peaks and shovels. They're the ones doing it out rather than operating. There was a hope investors realized this, that one third I was referring to earlier on industrially-reaches working, to a very large extent that is AI related. I mean, a lot of the resources stocks are direct leverage of data center demand. For instance, for example, yes. The discrepancy in your Australian share market is that we tend to dislike companies directly involved in data centers. Next thing, is that it would be one example, a good-man group, would be one example. But we're more than happy to buy the companies who basically get the orders from them and Southern Cross is one of them. So there's obviously discrepancy. The market doesn't seem to be quite logical. Maybe if you throw in bond yields, because both good-man group and next you see are impacted by bond yields.

7:21And arguably the likes of Southern Cross less so. Now, just to be sure that if something happens to the AI trade in the US, that will impact those stocks heel locally as well. I wasn't surprised that McQuarrie initiates with a positive rating, because this is actually one of those relatively high-quality contractors that we have in Australia. But the value on Monday was quite fierce. And that obviously is coming out today. If you want to stick with that theme, and there's more than data centers there, there's a general construction, there's infrastructure, you name it. And not all stocks in that sector are performing. So the market is clearly cherry picking at the moment. If you want to stay with that theme, this is obviously a great company to own your portfolio, but maybe not at the price. And so I would say buy on weakness. But also be aware that if anything ever happens to the AI trade,

8:26in which case the weakness in good-man group and the next you see would have been a harbing or precursor to that, then obviously you're sitting on a wrong stock. All right, so you'd be holding it potentially than buying on weakness looking out for that. Sure, have you been playing the AI trade here locally? Obviously we're talking about those commodity related stocks that are benefiting from that AI I've build out. But have you had direct exposure through the likes of good-man next DC or even Southern Cross? We've had, we're not Southern Cross now. We've been long to the Gunnall's copper, which has proved very, very successful for us over the last 12 months, 24 months. Samfire BHP of course, we took a little off the table BHP a few weeks ago, which is still prudent to be the right thing to do. Even evolution was our preferred gold play because it's 25% copper these days. That hasn't been that good a pick. And we do own good-man group, which has also been that being, you know, that greater pick.

9:26And that's been a lot of people's portfolios look on these days, where there's some great winners in there and a bit of heavy stuff. I feel like there's no reason to sell the copper trade. There really isn't the supply demand dynamics work. But as Rudy and I were talking about earlier, the Australian market, the world is long copper. It's long the resources. So it's going to be interesting. They're really going to need another leg up. Some of the more good news, more move in the underlying copper price, whereas good-man group, if we see bond yields come off a bit, that could really take off. So we're happy to hold. If we didn't have a position in good-man group, we would buy it here, which is, you know, positive. And it adds for seven cross. The risk award isn't that exciting at these levels. There's a lot of good news built into it. And if I own it, I'd be almost selling it in buying good-man group. But unfortunately, I don't own it. And we own a market-manage good-man group. So we've been on the wrong side of that peasant trade. Yeah. But right here right now, I wouldn't chase up into this struck. I'd call it a hold. A hold by the wing that's actually taking some profit.

10:27Yes, I think so. Okay. All right. Let's call that a double-haul then for Southern Cross Electrical. Let's take a look then to the first five stocks that's chosen by you. We are going to take a look at NAB Wystech Lowell, Bramble, Smoothak and Oroca Sellitz. Get off with one of the big four in National Australia Bank. And of course, with the RBA tightening through the last week, you look at the probability of a loan loss cycle into 2027. So that said, Sean, how do you look at NAB and I guess more broadly what you've seen with the big four at the moment? Well, one of the things we have got right this year was to be very underweight the banks. Now it's down about 9% year today. Not the market's gone up a great deal at that time, but it's down. It's down almost 10%. Obviously, it's played one dividend along the way. I've just seen no reason to buy it. I see no compelling reason to increase the weighting to the banks at all. ANZ remains our third option.

11:28It's improving and evolving as a bank. Sure, it's yielding 4.5% fully frank. So if Bonniel has come back, you might see a bit of appetite coming in on that front. But you've got the risk of bad debts. They're just in the fray at the moment, whether too hard. I just don't see any reason to buy them. Are you holding any banks? Yeah, as I said, we're holding ANZ and Westpac. But we are significantly underweight the sector. So roughly half the weight to the banks to what the actual index weight would be? Yeah, if you're in NABs, your choice then would you say that or not? No, I'll sell it on my own. Okay, yeah. All right. Ready? It's my quarry. Iron Macquarie. And according to recent analysis, that's also the front managers. They just favor it when it comes to banks and financials. And Macquarie has actually become more of a bank in recent years. The banks, yeah. Probably interesting to point out that we had a peak earlier this year, but just what everyone thought that was way overvalued.

12:31They've come down, but that doesn't make them cheap here. And there's an argument to be made that maybe the bond market has priced in everything that's going to happen with the RBA. But we still have to wait what the consequences of that are. We can get consequences. More bad loans, slower slowing down, business going out of business and competition kicking in for mortgage wage. So does that mean that the banks will actually become cheap? Ah, I mean, give me a coin, huh? Because it's Australia. I mean, there's such a big impact on the... But I completely share the sentiment. I mean, you're on the way to banks. I thought Macquarie, I don't own banks. I almost never do. But other people have different views on that. They are happy to cash in the dividends. But for me, and I'm not so sure, I mean, other people think that West Bank is the best one here,

13:31because that's the lag that can make inroads. I'm still not convinced that you should trade in CBA for one of the other three. I think we've seen that correction as well. So I don't own banks. I have no ambition to own banks and people should make the opt-on mind. I'm going to call that a double-sell in for NAV. Guy's been... Well, the end for some dramatic stuff. You buy ends in, you buy Macquarie. There you go. All right, let's turn now to tech with a look at WiseTech. In fact, one of those prominent local elite listed tech stocks. And, well, goodness, we know what's gone on with the logistics software giant. Lots of headwinds to deal with over the past year. Governance, regulatory issues. And also notably removed from the S&P ASX 50 index during the September rebalance, too. Stock is off some 65% over the past year.

14:31And so really, it simply hasn't recovered. Is it looking attractive to you or not? I'm surprised there's only 65. It must have started falling earlier. Here's a proposition. I mean, there's two other things that you should mention. There is still active investigations going on in which it's white. And there is one man key risk involved. The other thing is that with all the changes that are happening internally, there's not even mentioning the rich and whites of personal problems. It's quite a few analysts that think they might disapoint in February. They might not make their forecast. So that's one of the reasons why, of course, there's no appetite for the share price. Other shares cheap, I would say they are probably very cheap here. This is still a part of all the shenanigans going on. This is supposedly one of our better technology stocks.

15:34Although, interestingly, it did bid. Co-DAN is now a larger market gap. It's now on number one technology stock on the share market. That happens when one rally is higher and the other one keeps falling. So is it cheap here? Yes. Are there risks? Yes. So now it comes down to what kind of investor are you? Because I suspect unless we see Bonteel's move in favor of Y-stack, given all the other risks, that share price I don't think is going to move. And the market is still very, very, very overweight at this stock, because everyone thinks it's cheap, but it doesn't mean it's going to move. Will it not move forever and ever? No. It probably will move at some point. February, we might have the risk coming out. We might have the investigations resolved and we might get some new customers on board and etc. But at this point in time, I am a little bit worried that the share price is not going anywhere.

16:36And then there's anyone's choice. Do you have it in your portfolio or not? I decided a while ago to offload my shares. For those reasons I've just mentioned, doesn't mean I don't have technology portfolio. You see those bruises in my neck? That's from owning technology stocks. But I don't want to watch it at the moment. And if you want to own it here, is anyone's personal choice? But my best thing I can make on my insider and valuations and predictions here is that I think if you own it, one key factor is be patient. I don't think it's going to move anytime soon. We'll call that a hole then, shall we? If you're in it. Or a very long turn by. Sure, how do you view it then? I've got to disagree with Rudy on something. I think probably eight out of ten of these the calls I'm on, we talk about Y-Stack. It's a pretty common stock and that's because a lot of people are sitting on a lot of paint. And we are two. One of the stocks we've got very wrong this year and we've held it.

17:40We've underestimated the selling. So I don't fully agree with what Rudy said about everyone owning it. There's a lot of people, a lot of fund managers who have got governance caps and the minute the problems happen in a rich of white, and they have been very real problems on a number of different levels. The governance issues kicked in and those fund managers had to sell. So I'd say there are some big potential buyers in the wings who could come in over the next few years, not the next few months. Okay, so you've got a stock here that at the moment, anyone that was a bit naive would say it's cheap, trading 70% below its five-year average, but it should be. At the end of the day, this is a very different animal to what it was a few years ago. It's trading on 20-hour time, 21 times, revenue growth disappointed in FY26. FY27 was worse for us. It came in below expectations. But an organic growth for cargo-wise was a bit worse than they thought. They're still obviously taken in a new acquisition. Blah, blah, blah. It's got some great reoccurring revenue.

18:42Probably not quite the same price can power. They did have because people want to see it. People who are not going to pay a significantly higher prices all the time while it's going through all the other shenanigans it's going through. However, we do believe it's a war class company. And it's not one of those companies that you can very easily replace the AINR opinion because it's got a lot of information underneath the hood behind the firewalls which people don't want to necessarily translate very quickly. So I'd call it a speculative buy. We still own it. We foolishly weren't as good as Rudy. We didn't sell it for the reasons he's alluded to. We underestimated the governance issues. We didn't realise quite how much Richard White had disappointed the company. Disappointed the market for one of a better way of putting it. He's a brilliant man. Absolutely brilliant man. No one dates what he's achieved with White Tech in getting it to where it is. But a few other things he's got role. From a market perspective. You've got a war class company there. Probably trading it around the right price.

19:43But we do believe Bonnill is getting a bit of a bit of a top of the up here. And if that's the case, this stock could easily punch 30-40% from here. So risk-water-wise, I think it's a buy. I'm expecting to buy. So we're happy to run it just here. It's a long-term buy from Rudy, but at the moment it's a hold. I know. Happy with it. I'm still waiting for the kit. It's between us. So now on to Brabils. Don't really ask about this one. It is the global logistics firm, I think, Pellets and the like. Has him worked on aggressive capital management strategy active share buyback program underway there, Sean? What do you think? One of those rare situations where the buyback happened at the right time, didn't it? The stock was hammered in May. Absolutely hammered in May. Because fundamentally they couldn't repair their pilots fast enough. However, we feel that an issue they can solve. Going forward, they have started to solve it. The business is still delivering.

20:43I'm going to come out and call it a buy anyway. We think it's a buy here. It's on our hit list. We don't own it. I stress. We were looking at around $18, which of course right here right now looks like a good price. But I think that we felt the FY26 was all was solid. Undyline profit rose 4% in tough environment. It's still doing the right thing. And if it can sort out repairing its pilots, which we feel it would, this is a beneficially from AI. So logistics company, which can really make it streamline lots of parts of its business with AI, as opposed to be replaced, which is a nice, you know, good thing. So, you know, I think at the end of the day, this is a solid company. It's giving you an opportunity to buy into it down here, which we haven't done yet, but we are looking at it quite closely. So I'm going to call it a buy. Really you on the same page? No, it's a hold. I think the market is taking a balance here between potentially bad news that can still come out, which is essentially that part of the US economy that is on the fresh.

21:47And that is basically, if you look at the US market, the market is absolutely very negative against anything that is anything to do with consumers in the US market. That includes the likes of Donald and everything. I mean, those share prices look absolutely ugly on price charts. And ultimately, that has to relate back to Bramble somehow. And Bramble's one of the challenges also apart from that is to keep their costs on the control. And unfortunately, the largest market is the US. So I'm going to sit more on the sidelines. I'm going to say that the market is probably correct in taking the middle road here between potential downside and potential upside. And it sits in the middle. And I think that's a hold. Unless the share prices cheaper, I wouldn't necessarily. Because it's not without whisks here. And it all happens about consumer spending. And it's a K-Shave becoming in the US as much as this here.

22:49And they're not necessarily linked to the Richard Part of society. So it's a hold. It is a buy and a hold for Bramble's. Turning now to move back to the next stock. It is where it's property, diverse property groups you like, developer, owner, manager, and the like. And it also actually active in a $200 million on market buy back. But as we all know, what's going on in property at most is involved residential development, commercial, build to rent, funds management as well. There's a lot going on. To the point, Rudy, can you follow it? Is it too complicated for you? No, you have to go for the key characteristics. And I think there's two key characteristics are building of properties and bond yields. And we were both in the committee meeting the other day. And I did suggest we might have to look into bond yields. But there was no appetite for that.

23:50Most people look at the share market. They go like, we don't want to look at bond yields. We don't understand in the first place. But in a very simplistic term, if bond yields move the other way, this should be all else being equal beneficially. And it probably will be because the share price looks quite cheap. This question went in one way. Well, one way to assess whether the share price is cheap or not is just to look at the forward looking dividend yield, not the backward looking. And for memory, I'm pretty certain that Sean's going to correct me for more on. For memory, it's about six, six and a half here. Six point two. Six point two. There you go. In the right in the middle of my range. That gives you, as an investor, if you can be patient and you don't have to take an immediate view on where bond yields are going. You have a little bit of a cushion there. Every six months you get three percent yield, assuming the share price doesn't move. That's not nothing that gives you space to sit there.

24:52The other thing, of course, is the housing market. And we don't know what the exact consequences are. We're shorties of trade-ease, build is going bankrupt, you name it. It's quite a lot of turmoil happening. You have to take the view that something like Mervec, large capitalized player in that market, that if there are one and two problems, that there won't be that significant for the business overall. And again, you get six point two percent yield plus franking on top of that. So I actually think this type of investor would go, well, if you have a room in your portfolio, why wouldn't you put in your portfolio, cash in the dividends and over time, no matter when the RBA will start cutting, but there will at some point, you will see a much higher share price. So it's a buy. So, Sean, do you buy it or that? Well, I've really only said that because we had a chat before we came in,

25:53and I told him that we bought it last week. There you go. Nothing wrong with that. Figure back time. No, and obviously by definition, I agree with everything really said. You know, at the end of this company is performing well with the headwinds at the property market, as under for all sorts of different reasons. I'm not going to point fingers there. Property market is struggling. We all know that. We all see what's happening locally. But you're seeing FY27 growth. That's still on track for good growth. Give you an idea of puts numbers on it. FY25 revenue is 813 million forecast for FY27 is 960 million. There's nothing wrong with that growth. You know, you've got a company that's trading around 15% below its fair value for the last five years, or average value, I should say, not fair value. It feels about right. You know, I don't think it's too cheap or too expensive. It's yielding 6.2% unfranked, actually. It doesn't have any frankenc. Good to see you. Yeah, yeah, yeah. It's not that frankenc. There are those, it would be really attractive. And of course, there's a small buyback going on, which is, you know, it's an assignment.

26:54It's a good time to buy back the shares down here. I think they've managed when they've got that one right, rather than buy the shares when they were trading at $220. So we've, you know, we bought it last week, or to be precise, we sold the stock around to 20. We bought back in when it got down to around two thinking that was about it. It's gone lower, so we've increased our weighting. So we left, we always planned to do that. We left room to do that. Didn't think it would be quite as weak. Didn't think bonnuals would go quite as high. But that's what flexibility is all about. When you run a portfolio, flexibility, very, very important. So we like it here. I feel that we'll be trading higher in the next year or two. If we've seen the low, toss a coin, but again, bonnuald stop going up. This stock will benefit. I think it's up 2% today, so it's a good time to set. As I was to buy, there are factors that double-wide. That is one for our investment community. Consider it in Mervac. No, they don't like Bosnia. They don't like Bosnia. They don't like Bosnia. They don't like Bosnia. Because you're going to explain them to them. You said they didn't understand that. No, we're going to wait for it to turn.

27:54Well, I'm going to make a signal again as well. I have one corg in the machine. So, Arika, it is the next stock. We're going to consider if you like blowing things up. This is for you, Stephen, asking about this one. It obviously exposes its manufacturer there, particularly the levy. The mining sector has confirmed its finalised into money and I tried supply chain allocations for contracted customers in North America for FY27. Sean, what are you thinking? I'm going to make my conclusion. It's going to be, I think, a cautiously bullish year. We haven't looked very closely at Arika for a while. We've looked at the mining sector in other ways. As you said, it likes to blow things up. It's revenue should be linked to the what's happening in mining. But that's much shown to you exactly why we haven't looked at it too closely for a while. It's going sideways. It hasn't really shown its hand. The first half, 26 results, was quite encouraging.

28:55There's three strings to the bow. Obviously blowing things up is by far the most important one. But the other two areas grew quite well. Chemicals have worked 20%. It's not that big of a growth there. I think the digital was up about 25% give or take. The things around the ages are performing as well, which is encouraging to see. But is it the best way to expose it to the space? The best way probably not. Do we feel it goes higher from here? Yes, so I'm going to call it a buy. It's actually interestingly trading exactly at its long-term average valuation, which tells you exactly what's happening in the chart. I like to say buy sometimes I like to be bullish. I think it's going to go up because we've got the market, we'll probably rally into Christmas. If I was looking at it compared to the market per se, I'd call it a hold. So you can write that down as you wish. It's really. It's from the top companies held by fund managers in the material sector.

30:00And that is probably equal to do with the share price. It's universally considered to be cheap. Now, one of the reasons is, with all the shenanigans going on in the Middle East, a lot of insecurity what's going to happen with the chemicals. And with the chemicals that they use for their mining operations. The other thing, of course, is that a lot of their customers are sitting in the gold sector, and gold is not booming at the moment, for market sentiment, those things they count. But not to spend too much time on this, I do think also with Shane Shron. You should give them the benefit of the doubt, I think. And they'll sort out their question marks in the US and the share price will, after all, this tabulation and sending is will ultimately end up higher. That's what I think it's a buy-to. There's another double buy then.

31:00But probably with patients. With patients. Well, slightly cautious, double buy then with both Rudy Shane and Shron. Okay, triple-way. Right, okay. Let's sum up the first half of the show then. We began with that stock of the day. It was the data center playing terms of Willards helping in terms of the build-out to think that it is a hold from both Shron has been playing copper in terms of his exposure to AI, but also does own Goodman Group. As does Rudy. All right, National Australia Bank. Look, yeah, look by saying, as foreign considerably, but still expensive, as you can say with all the banks, but to both would sell it essentially Rudy. Owns the inquiry. Shron prefers ANZ and Westpac. Vice-Tech global. Goodness gracious to what a controversial stock this is.

32:01However, look, really pointing out there's still potential regulatory risk here, but it is cheap. He would call it more or longer than buy, but the moment it's a hold, whereas Shron is calling it a specie buy. He's owned it and it has been a painful trade. Looking for that comeback. Brambles, it is a buy from Shron. It is a hold from Rudy Murwak. It is a double buy, both looking for the potential there, and also mentioning that the debut of their 6.2% unfunct. And finally, they're Oricup, another double buy. All right, now let's catch up with our own high-conviction fund. That is picked by the investment committee. Now, later this episode has just landed at osp.com.au. So going into October, the panel saw that at 2K honing's added a couple to replace them. Which ones? Ah, well, you've got to go to osp.com.au.

33:01You look for that drop down many of the investment committee to find out which ones and their reasons why they made those changes, and whether you think they got it right or not, time will tell. I'm checking, of course, in a month's time. So keep those requests coming in. I strike gold! Do I need my glasses? No, it's 8% Yeah, I strike lightning! What have they done? Those did it end. Happy days. I strike gold! Never a dull moment. Bring me the next shiny new thing. Live weekdays from 4PM Aston, watch on demand, all catch up with the newsletter or podcast. The COB is brought to you by Longview, a new way for investors to access Australian residential property. Visit longview.com.au Second out of the show, we are going to take a look at Miso Blast, Harm Enormon, Omedia, Seek, and clinical pharmaceuticals. Alright, so let's begin with Miso Blast.

34:02So most recent news announced that the US Food and Drug Administration has approved its new T-cell. What it calls proliferation in a Bishin assay for commercial batch release. It does allow the biotech essentially to streamline the manufacturing role out of its lead stem cell therapy, Ryan's cell. Rudy, have you looked at this before? I still remember when Miso Blast was one of the tradeable stocks on the stock exchange. And very popular too. And the share price was a lot higher. Having said so, we have to give them some credit. They hung in there and they're finally getting to a phase where where growth is now is not picking up and coming in inside in space. But the market is saying no appetite at the moment. Biotechs in particular in the phases where Miso Blast are in, they never without risks. There are plenty of examples for that.

35:02I can see the growth finally kicking in. It doesn't mean that it will all be free-wiring from here. For me, it's stock like Miso Blast. It just doesn't tickle my fantasy, to be honest. So does that count as an A and I? Not interested? Yeah, you can put it down as I'm interested. You'd give it a miss, you'd avoid it, you'd sell it. Yeah, okay. All right. Short, any interest? No, we haven't owned a biotech for a long time. Stocks stay in 27% this year, which is not a reason necessarily to jump on board. But then again, I have talked about Mervac, which is down quite a bit as well. You know, you're the company, I think last time I checked his market's cap, was about $2.5 billion market cap. It's got a big market cap. Still hoping to be profitable by about FY28. So there's a bit of a disconnect there. So I think it's going to get into it on yields aren't helping it,

36:02but they're not helping any part of the market. So at the end of the day, no interest is actually a very, very good way of putting it. It's not a stock on our radar at all. When I saw it on the list of stocks today, I thought I hope we really talked about it. But you both come in the same conclusion. I did. All right. We'll call it a double-cell or a word if you like then for me. So, last, let's now turn to one of the prominent Australian retailers in Harvey Norman. It's actually Traveyor X-Div today. So I don't know if it's down around 2%. But Sean, look, we know what's going on with retailers. Obviously they hit Wednesday at the moment. But I guess it's another string to Harding Norman's buy. Well, arguably the biggest string, if you like, is the property portfolio, which keeps them afloat. What are you thinking? Well, one could argue that's not a good thing at the moment. Of course. You know, they've got a big asset there as we know. What is actually worth market to market? It's commercial property, not toy-reduced. Of course. But still sentiment. Sentiment is a big thing. But I totally agree with you.

37:02The stock's almost halved in the last 12 months. We've been bearish to stock virtually all that time down. We turned bullish on it last week. So it's not hard to go where we go from there. We haven't bought it yet. But as I was talking to Rudy earlier, we think it's time to start. We don't own any retail. I think that can well change in the coming weeks. Harvey Norman. But is there not the most, as you think, that rates have paid? One of the reasons. And that's one of the reasons why we didn't own any retail at all was the consumer. But you get to the point where the consumer is bad as it's going to get. We all know. Well, in fact, we just have the latest rate on consumer confidence. It is at record lows. Yeah, it's absolutely sharp. How many people do you bump into whether you're in the power-bore, in the coffee shop? How many people do you think, to talk to a bit? No one is up to the moment. Don't start with the coffee shops, given the drawers search-ach fees, that everyone bumped up their prices. As they should. Why should the small business, don't they? Don't get me stocks on that. I own a small business, and I can assure you, you know, cash is king.

38:02In lots of ways, you can see people, you know, the coffee shop downstairs gives me a discount for cash. You know, I was carrying $10 cash by a couple of cups of coffee. But that's another, we got a fair time jump there. That was always going to happen. So I'd hate to think how much it cost to implement that whole thing. It's made no difference to anyone. It's probably given some of the small businesses the opportunity and the reasoning to actually hike up more than the more than the search-ach, but anyway, moving on to Harvey Norman. You know, the stock's almost halved. We feel like it's almost getting into as bad as it's going to get. It's only trading around 10% cheap, which again, shows you these levels. $4 ex-dividend today. It's a year-warding around, I think, 6% fully frank. Give or take, I'm not sure what the dividend was today. I didn't check before I came in. But around $4, I feel the next 20% is up. Not down, so I'm going to call it a buy. So you're considering retail? Is that at the top of your list or not? Probably I'll sit down with James. I'm probably leaning more towards super retail, but we'll come up.

39:04JB High Fire has been a stock with the last stock we owned in the retail space. And we sold that, which again, has proven to be the right thing to do. But that can turn very well as well. If people start spending, it's a world-class retailer. So again, probably not Harvey Norman. It's not James's favorite. But it's certainly one of the ones we'll bank surround. I think we're going into a market. I'll say this, as Rude and I were talking about, if the market's going to get back above 9,000 into Christmas, which we think it could well do, some of these dogs that invert to commerce are going to need to do a little bit of the, I say heavy lifting because they're not big enough to have a lifting, but banks back a bit. Especially if the banks keep tired. So I think there is going to be some upside in some of these stores. All right, then it's going to work their way out of the kennel. Yep, Rude, we were talking about this on the Investment Committee, potentially the opportunity in retailers, but not their, yes. Yes. So how do you rate that at an obstacle, Harvey? Well, again, I mean, you can see the philosophy that Sean is bringing to.

40:08Even if they're by today and they tend out to be early, and like the Shephys has another, let's call it, 5, 6, 7% to the downside. If you take a longer term view, the upside is much larger than the downside for me, because the Shephys is already very aware of this. I personally think that that probably a little bit early in the cycle still, like the market has priced in the RBA hikes, but not the consequences yet. So if you believe all those scary stores that are out there in the AFR tends to be very good at it, that the housing market will never come good again, and it's dead in the water, and every single retail is going to go bankrupt and all of that. Then there's clearly there's more bad news coming for Harvey Norman, and that is not yet in the Shephys. But then you have to consider, given there also a decent dividend yielder, how much can the Shephys still fall from here? As I said, more than 5%, yeah, possible.

41:09It can be depending on how bad the news gets, but if you take a longer term view and bond yield at some stage, well, we'll reverse, the RBA will be at some stage, depending on how bad things become, will be forced to start cutting again, and then that Shephys should go higher. But there's an old phrase, plan your trade and trade the plan. You could put, say for example, X percent in here around $4, with a plan to buy 5% lower, and maybe a little bit more 10% lower on the out-and-chance, and I feel still, the same one I'm saying, I still think the next 20% move is on the upside. We're not traders, so being early doesn't bother us if we were right. But if we were wrong, would you go early then? No, I'll wait. And I also think there's probably better, better retailers out there. All right, well, call it a hold then, and a buy from Sean. Not all retailers have such a direct link to the housing market either. True. Which is next, always. Yeah.

42:09All right, let's turn our attention to O media. Now this may be a bit of a move point, really, because the actual CEO has cleared its takeover. So really effectively it's become a bit of a merger arbitrage. Well, is there still arbitrage there? Well, I think the price is this way or this. I think the whole sense maybe. Is it? I don't think. If you really want to squeeze it out, yes. Well, again, I don't know who cuts the cuts, cuts cats in two or more, but there's many ways to skin a cat. But there's many ways of making money in the share market. Yeah, well, it still hasn't moved much. Why? Because that's what I'm saying. That's the price. Because it's not four cents, because they're going to pay out two cents in dividends. Yep. And so you get an extra two cents. Is that worth it? In my book, I've already left a book to play and take it. And I'm in different territories here.

43:09So I don't know how much we should talk about this, because I think they're going to vote about an early November, the shareholders. And I mean, there's always a chance that the shareholders will say, no, but I don't rate that chance very high. So I think this is, no, this is a done deal. You've seen too, look at their long-term shares. It's very much of a long-term trading. So, isn't it? Well, yes, yes. Don't forget, this is a relatively small business. It was popular at some stage, because the whole media advertising thing was moving online and into the outdoors. But apart from that, and it's obviously it's without the takeover, it would be down in the doldrums, this is very much linked to how much companies spend on advertising. And that is not the environment. We just asked the media companies that are listed. So, Rudy, if you iron it, would you just sell it? Oh, yeah. Definitely. I mean, there's always a risk that something goes wrong.

44:11And just take your profits and put it elsewhere. Sure. Definitely sell. No reason to hold it at all. Or you can just lose it from here. Yeah. I think Rudy's been, I love Rudy's optimism there. Take your profits. A lot of people wouldn't be holding profits in the stock still. It fell to 80 cents. They've had a lot of shareholders have had to get out of jail free card here. Marker hasn't given a lot of those this year. I'd be selling that and whatever price I paid for it, I'd be very, very happy with that income of this. I mean, there was a bit of a bidding war. Management did the right thing. They seemed to squeeze as much as they could out the price. And as you say, that's it to be fair. There's not many people that would be losing money from that. Sell it, move on. Surprise it was in the list today. Yeah, we can't really add a great deal of volume. No, okay. All right. Double sell, move on. But soon to see it is the employment online marketplace. There has experienced a bit of a rebound after, well,

45:12it's in due to steep sell off over the past 12 months caught up in the whole SaaS apocalypse valuation down more than 50%. But made a bit of a comeback. But Sean, we often talk about a od disruption. Of course, that was the reason for that SaaS apocalypse. And whether it's still vulnerable, it was seen too. We got some latest job ads from A&Z today, which are actually up that all feeds into obviously the likes of the seek. How do you view it? Part of Market Matter Service for members is we have a section called Sean's Trading Ideas because I used to be a prop trader at Goldman Sachs. So I'll come out with a few trading ideas every week. It's all about risk reward. It can be quite boring. And we bought or I bought Seek this morning. So there you go. I think from a risk reward point of view, and I stress that very really well, a position carry more than 10% risk. It's like, get out, it doesn't do the right thing. The chart there doesn't show up very well. But I wouldn't be at all. Right, your volume isn't gone up. No, no. I bought it and I'm making a bit of money,

46:12but it's certainly not enough to buy too many coffees at today's prices. But let's look at it. It got hammered on valuation compression with Bonneilds and the AR disruption trade. But also you shouldn't forget revenue flatline. It isn't one of those stocks that's been performing but suffered from compression. It's also hasn't really been growing. I think the last couple of years, $1.3 billion revenue hasn't been growing. The guidance in August was extending weakness. Same on profits. Profits has gone anywhere. Exactly. So I was going to say that. Thank you. Exactly. It's a profit aren't going anywhere. It has got some assets. It might be divesting up to about a billion dollars. Time will tell. Apparently they are mulling through that. I haven't got the latest update where they're up to. And of course the market probably hasn't either. So that's probably where help it. There might be some buybacks involved or some capital back to shareholders. It's 45% below its 5-year valuation. But it should be. You know, it should be down here.

47:12So from a trading point of view, I'm looking for a bounce back towards $16, which would not dent the drop it's had. So I stress it's a trading buy. I like it as a trading buy. It's not on our list of stocks to invest in. So there's very, very different scenario there. All right. None of us is a buy. But to your point, a trading buy. And Sean, how do you feel about those other online marketplaces? The likes of real estate and car sales. Car sales is probably the preferred one of the three. I could buy car sales as an investment. It's doing other things. It's doing the right. RIA Group's got it. It's been a great company for so long. It's got a few other headwinds coming into play. But again, it's bouncing quite well. So I'd probably, if you ask me which one I'd buy, be car for investment perspective. Not sick. Six of trade. Ready. I own both of them, but not this one. I don't remember exactly when it was, but I didn't remember I was here with Mark Gardner at some point. And Seek was under $20.

48:14And I said was a screaming buy. And that proved for the time being correct. Because it went well into the $20. And now you look today and it was $11. It might even be even lower recently. Hang on. So do you buy then? No. Right. It's under $11. Under $11. There you go. Because the reason why I bring that up is that in this market, it's amazing how low some share prices can go. And I would actually include cargo open that one as well. I would have never thought when this share price was in the 20s that would actually more than half and come to 10 something. But the market can be brutal. One thing that two things I can add to Sean's expose is yes, a lot of people are not familiar with this, but they actually have an investment fund underneath the business. So they act a little bit like private equity. And there is some speculation that given where the share prices and given other businesses, they might actually start looking

49:17at some offloading, some of those assets they have. The problem is probably that many of those assets will have been de-rated now as well, because they are technology companies. The other element which is worth pointing out is that this is the one company out of the famous three that came out of the 90s with cargo open R.A. That has had much more to deal with competition. There is constantly new competition kicking in. So those ABS numbers away, those job ads numbers, that's no longer reflective necessarily, or no one on one was happening in their business. There are so many more opportunities to access and to place job ads. And that is basically the problem of seek. They for years have to make very large investments just to stand still. And ultimately you add an economy under pressure and then you get a share price at $11.

50:17It's one of the most expensive platforms to advertise on. You can go to the website and start putting your parameters of this sort of job on after, but do the same thing with that. There you go. I think this is very much a struggling business. I don't know whether it looks cheap of course, but in my case it would be the least preferred. And I'm alright, so you don't want to be there. Yeah. Because I would say. It might go to $16, but I wouldn't be surprised if you come back a year later and it's at $8. As I said, it's not an investment buy. So it shows in terms of investments on my whole. This price, because I think you'll get better price to get at. But of course I had to mention that because we put out a buy alert today. The one thing to mention also is not pay close attention to this. That seek is building up just like at one state, CSL did and cochlear did. Repeat the disappointments in reporting season.

51:18And that's when really your alarm bells should be awakened. Because companies that do well to say the obvious. They don't consistently disappoint in reporting season. Watch out for that. Then next time round, but the moment is trading by. As Sean points out, we're as already so interested. Let's round it out with a look at the plan oval farmer. So, of course it is bio farmer. Look essentially it develops and commercializes treatments for skin and central nervous system disorders. Has generated a strong institutional momentum. That's had strong cash flow pipeline there. Also structural progress with its drug port folio. Really? Again, it's an unfortunately for me, it's an ally. For the simple reason that I don't understand this sector well enough, including Klimafel. And I find it very difficult to assess what exactly are the risks. On top of the fact that it put it obvious,

52:21the market is not liking it the moment either. And small cap of biotechs, you really, history shows you that. You really, really have to be careful. And so for me, I have my money elsewhere. Yep. Well, and if you've had your money there then. Yeah. Has it been a great ride? Yes. So no question the bank would have bought before. Yeah. Second interest. Sean, I'm going to end up with the same conclusion, but I would add when Rudy says he doesn't understand the business, I'm the same. But what I do understand is bio-tex, if you buy a basket of 10 bio-tex, you're going to get behind every year. And one of them might look fantastic, but the other nine will let you down. I don't need that. It's a binary outcome with a wrong risk reward profile. But as mentioned, if everyone had that approach. No, because some people like to punt and they like to be greedy and they like to make a 10-bagger overnight. And one of those 10 will be a 10-bagger,

53:22maybe a 20-bagger. And you'll find that the situation is that somebody will have a really deep sea to understanding other companies and business as well. Probably starting with the directors. He is so direct to buying and some of these stocks. Nothing wrong with it. I like to see it. But that would be what made me look at it closer. But the stock is down 35% this year. It was easy for me to look at it and be negative. But also you've seen revenue for, I think, 4% this year. So revenue is going down. Net profit after tax was down 6%. I just checked my notes. So, you know, if it's well owned by fund managers, as you said, and there are probably a few of them in the lightning office we can see down 35%, had analysts downgrades this year. You know, it's got a solid balance sheet. It's making a profit. That's a lot better than a lot of biotech. So, it's a little bit. But for memory, the disappoint of the game in August. They did. And sometimes that's all the market notes. Well, you saw the chart. Yeah. So there's no need to be there. Yeah. Not interested. And it's not specifically this company. If I was to look at a biotech and I saw what were the health-y balance sheet making a profit,

54:25it's the first place I'd start looking and getting underneath the surface. But as a sectorist, it's high risk. Right, oh, and avoid then. So let's start the second half of the show. A solidly negative. Certainly compare with the first. Well, sort of Rudy's pointing you. Because we started with me so blast. It's a sell from both. We've just been exploring that biotech. That binary outcome. It's flip of the coin in a lot of respects there. So both don't want to be there. Harvey Norman in retail, obviously. Sean, look, has been bearish just turning bullish. See some potential here, particularly if we've seen the top of the rate hiking cycle. So he's prepared to buy it at this point where it really wants to wait. He would hold. Omedia. A bit of a mood point, as I mentioned there, because it's pretty much a done deal in terms of its takeover. So I'd both would sell it, y-hang around. Seek. It is a buy from Sean. He was a trading buy. Let's just be clear about that. Not a long-term buy. So he would be, but prepared to buy.

55:26In fact, he did just that this morning. Whereas Rudy's just think we're getting struggling. He doesn't want to be there. He'd sell it. Anklening of all. Finally there. Both would be avoiding it. Gentlemen, you've done it again. Okay. Yeah. Yeah. Well, you turned up. You gave us your opinion. That's good enough for us. Rudy, thanks for joining us. I'm happy to read that. You'll have me good help. Yes, you'll be there with Sean. Thanks for joining us. Absolutely pleasure as always. And thanks to your course for sending your stocks in. And thanks for watching. Thanks for listening to The Call from Osby's. Keep your earphones in. Our bonus CEO interview is up next. Dr. Andreas Schweyer is the managing director and chief executive of Electrooptic Systems. And Australian Defence and Space Technology Company, developing remote weapon systems, counter drone technology, high energy lasers, and space tracking capabilities. Andreas, welcome to the corner office.

56:27Yeah, thanks for having me here. So Andreas, for anyone new to EOS, can you explain how all the different components of the business fit together? So we have two strategic objectives. And all what we're doing is falling into one of the two categories. One is all what relates to anti drone business, whether it's effector type of activity like the laser weapon business or Cannon-based air defense, or whether it's the integrated system approach with all the command control software behind all that falls into this category. And the other one is the so-called space control business, where we also need the laser weapon that means engaging against any object in space, including satellite from ground. And you've built an international career against aerospace for space and defense. You've had senior roles at the European Space Agency and Airbus. How did you eventually come to be at EOS and what attracted you to the company? Before I joined Electrooptic Systems, I have been working in Saudi Arabia

57:28to build up Saudi defence industry at that time. I was in charge also to identify any kind of key enabling military technology. And the laser weapon technology was one of the very top of this list. And we reached out to all international potential partners in this domain and we selected EOS to become our partner in laser weapons because EOS owns all the IP for me to set and was willing to collaborate and to also start a local production in Saudi. There was a starting point and later on it was a coincidence when my term in Saudi came to an end that exactly at this point in time EOS was looking for a new chief executive. And I took the chance because I knew that the company is a tremendous portfolio of IP innovation. It just needs to be commercialised. So I thought that's a good chance to do that. And you became CEO in 2022. And as you say, at that time it was facing significant financial and operational challenges. So at that point, what did you believe needed to change

58:28and how different is the company today from when you joined? The company was founder, let the founder. He is one of the best laser physicist worldwide. And obviously the focus of the company was very much on R&D. And at that time they have missed a little bit to commercialise and to reach out to key markets to make money out of all that. They were very much concentrating on generating those kind of IPs. And that was the main reason why the company got in distress. Another one was COVID during that point in time. Plus one contract in the Middle East, which was signed under unfavorable terms and conditions. So all that together, we're creating the kind of perfect storm. So it was not rocket science to get the company back on track. We needed to really go share those contracts and start to commercialise the products which were sitting almost ready on the shelf. Did you have to make any very difficult decisions during that turnaround? We had to let go many people. It was obviously very difficult.

59:28About 30% of all staff had to go. We had to exchange the entire management team. And we had to cut off some of the businesses which we are money losing. So we were concentrating on a few product lines which were highly profitable. And giving us a promising outlook to the future. So all in all, it was not an easy time here. So I wanted to now and ask you because drawing wolf areas in area that is rapidly evolving. How do you stay ahead of changes in drone speed or autonomy and swarm capability? And what gives you that competitive advantage against other companies, particularly bigger companies? So we are greatly benefiting from the fact that we have hundreds of installed and deployed systems in the two major conflict areas of the day. One is the grain war and one is the conflict of war in the Middle East. We have no grain more than 250 systems in active operation. And in the Middle East we have more than 60 fully integrated systems active to protect the lean fast structure.

1:00:28On a daily basis we are shooting down drones and rocket submissiles. And we get feedback motors on a daily basis on what's ongoing. So we can adopt software wise on the actual needs. So is a lot of your research and development then driven by what's actually going on on the ground right now? Yes, on the ground and in there that is indeed happening. So we are getting I think more feedback than anybody else because of this large install base. And we are a highly agile organization. I mean we have very thin overheads. We have very quick decision-making processes and we allow our engineers to adopt in almost no time without waiting for a large approval to get acceptance by complicated proof of sex within the company. So that is giving us I think a significant leading edge. And you acquired Mars, not the planet earlier this year. What capability did that business add and why was acquiring Bershaw then perhaps developing the technology yourselves?

1:01:28We have been for the last couple of years probably one of the largest anti-dron effect or provider. So effector is a weapon system to shoot down drones with our laser weapons and can't base their defense systems. We are quite dominant in that domain, but we wanted to be able to offer to the client integrated solution, turn key solutions, which require the so-called command control system, which is controlling, commanding and managing and demonstrating all different types of effectors and sensors with one piece of software. Mars is one of the very few companies worldwide having developed a very specific anti-john command control system. Their core is their software coordinator, which is AI driven. And this is quite unique this piece and that's reason why we have acquired Mars. We are now in a position with all those ingredients together to offer fully integrated systems to the client. And systems which are really designed develop for the anti-john warfare.

1:02:28It was not developed for very complicated network centric warfare where you have to control even complicated missile systems such as Patriot. Those systems are an overkill for most of the user demands and that's the reason why we have Mars. We have done exactly the right thing. And what would the successful integration of Mars look like over the next 12 to 18 months? We will, so Mars has already integrated all of our effectors so we can more instantaneously roll this out. But we can also benefit on the remote weapon system and laser side by integrated by integrating specific algorithms, software algorithms for Mars with AI features in to allow our effectors to also have a more accurate and more reliable tracking and identification of threats. Once those weapon systems have locked on a target. So in this kind of cross fertilization is still to happen. We have not done the set but it's on our work plan.

1:03:28And let's turn to your results quickly because you've just reported first half results. What can you tell us about those? We've had the best half year in the company history. We have more or less quadrupled our revenue in the first half from around 44 million, 2025 to 169 million first half of this year. For the first time in history we have had an positive EBDA of 21 million dollar which was extra now extra order and I good. And we are most proud of the order book which we have over the last three years quadrupled to about 849 million actual status. That is quite amazing. And we are by far not at the level what we think we can achieve by end of this year. We expect further growth to happen also in order in the order intake pipeline. So that is probably the piece which is most was amazing. So that order book how much of that do you expect to convert into revenue over the next 24 months? So we have to distinguish between the border clients.

1:04:28The mass products are quite quick in turning from order intake backlog into revenue. That's because of the fact that mass is a softer company, softer you can easily copy or multiply. There is no scaling problem coming with it. It's just a problem of procuring quickly radars and other types of sensors and effectors from the market. Or I would say in 70 80% of all mass order intake will convert into revenue within 18 22 24 months. So that is extremely quick in turning over. If you talk about a hardware oriented product such as the high energy laser weapon that typically is between 18 and 24 or 30 months. It takes a little bit longer. Mass is the more agile part because of the nature of the product. And does that existing balance sheet give you enough capacity to deliver the order book or will you natureize capital again? We don't need capital to increase our protection footprint. And we have protection capacity in excess for what we need in terms of remote weapon systems.

1:05:34We produce weapon systems at WS in Australia where we can produce more than 300 systems per shift. And we can also introduce a second shift if needed. And we have the same type of capacity in Huntsville, Alabama, United States. And we are opening out of facility in cooperation with our adventure partner, Gen 5 in the UAE. So there's no need for additional capital investment on the software sacrifice. As I mentioned before, there is no production capacity increase needed because it's just software where we might need some money here and there is to provide campaign guarantees and bonds for large prime level contracts, which we expect to sign in and be leased in the course of the next year. Yes, as we are now and OEM we are competing now against the big companies, companies like Raytheon, Tales, Leonardo for not only systems protecting a single piece of infrastructure, but also regional or countrywide anti drone systems.

1:06:34Those are large scale contracts, which require from time to time significant level of bonds and guarantees for that we might need some more money, but not to increase production capacity. So there's a lot of potential milestones for investors to watch out for coming up. What would be the sort of the first ones to come along in the next six months? We still expect some significant orders to be realized. Those would be the very positive announcement to come and we expect those to start to happen before end of the year already. So all the days order book with 850 is not the end game of this year. Defense stocks sometimes get valued on the size of the opportunity before the profits and the cash flow catch up. What evidence should investors use to judge whether AOS is successfully converting its technology and backlog into a durable business? By watching very carefully our order intake pipeline, hoping it increases the order book and how we convert this into revenue.

1:07:35We have now started this journey by giving an update on our guidance. So we expect for this year the revenue being within 3600 or 400 million dollar. And you would see that we are very optimistic to increase this further on next year very, very significantly because of the order book and the conversion rate. And those are the two parameters to be watched out or intake and how quickly we can increase the revenue base. It's not very complicated to see that trend happening and we will always under promising and over delivering the bus our motor since the first day, 2022 when we came and joined the company. And that that will remain our motto for the future and we will always surprise the market by good news, better than expected. Andreas, I want to ask you some personal questions now so investors can get a bit of a sense of your background. So what's the biggest lesson you've learned? It's the silence. Never give up. We have had in particular during the time when I started this job here. We were really facing critical problems.

1:08:41We were almost running out of money at that point in time and we count the coins every evening more or less in order to make sure that we can survive. So the hard time was in the very beginning and we had a couple of negative experiences during that point in time when governments or when other stakeholders didn't want to support us anymore because of the risk profile we came up with. And that was very hard. There were quite some disappointment during those days but all that we could convert into optimism very soon and that's history. Nowadays we have no problems raising capital or getting credits. We are in a superb upswing that is behind us but the first few months were really very tough. And what inspires you? It is the tremendous opportunity to shape something very big. Again, the company was close to collapse when I joined and I see the potential to make this a multi billion dollar enterprise in terms of revenue.

1:09:42And that is something which is not in the far future. That is something which we can achieve all the next three to five years. There is hardly any other defense company with this kind of momentum and course perspective. The key is really the high level of innovation which we have on the shelf which we can easily convert without investing big money into R&D. And what do you think your team would say about your leadership style? They would say, Bobby, extremely agile. I'm extremely marketing customer focused. I spend most of my time with clients, with industrial partners to form up networks to open new markets. That is something where I think most of my team can learn a lot. And some of them they would say Andreas is the locomotive and we have to take care that the train is not decoupled from the locomotive because it's pushing so much. I love that locomotive. And I get a sense you're also very positive. Would that be correct? Yeah, I'm always optimistic. The glass is always harmful, not half empty. That's correct.

1:10:43Yeah, it is a good way to look at life. Finally, Andreas, where would you like AOS to be five years from now? In five years from now, we will have a multi billion dollar of revenue. I'm quite convinced about that. A huge order book. We will have a more international operational footprint with active production facilities in Europe, more in the Middle East. By that point in time, I expect that our US operation will deliver in large scale to the US Army to the US client. We are about to capture to get back the US market. And I believe that we will be the world leading system provider, not only for undidrone systems, but also for laser weapons. And the world leading company outside the United States of America in what we call space control, space warfare, the ability to engage against space debris and satellites from ground with high energy laser weapons.

1:11:43That is the kind of scenario I see coming in three to five years. Dr. Andreas Schweyer, CEO of Electro Optics Systems. Thanks so much for joining us at the corner office this morning. Thanks for having me. The TikTok Shop and over 200 more integrations with one platform that does it all. You can manage orders, sync inventory, track returns all automatically. Everything your operation needs all in one place. Right now, qualified shippers get a real dedicated person to get you set up and switched over for free. So when peak season hits, you're ready to go.

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