Quickstep announces operational overhaul as drone production surges
Aerospace composite business Quickstep Holdings (ASX: QHL) has finalised a series of operational changes designed to optimise performance at its Bankstown facility in New South Wales.
Changes within the Structures business unit will result in a reduction of direct production and operational headcounts by approximately 20%, with smaller teams in operations leadership, quality, procurement and engineering to be supported by new investments in technology.
Operational transition
Rationalisation of Quickstep’s corporate support functions is also nearing completion, with the timing of the remaining changes planned until the end of August to ensure a successful transition.
A reduction in customer demand driven by de-stocking and aircraft build rates, plus a customised ‘level-loaded’ production plan, has enabled a transition from operating three shifts six days a week to two shifts over a five-day week.
This change is expected to increase consistency and promote a higher level of productivity throughout the business unit while continuing to meet customer requirements for on-time delivery and high quality.
In June, Quickstep announced the expansion of its Geelong facility and the award of a grant from the Department of Science, Industry and Resources under the “Moon to Mars” initiative.
The expansion will enable development work to continue in support of various space initiatives and deliver a prototyping capability for guided weapons components such as rocket motor housings, fuselage bodies and launch systems.
Lockheed Martin contract
Quickstep has finalised pricing and volume requirements for a contract with Lockheed Martin awarded in June covering the supply of componentry for C-130 military transport aircraft from the 2025 financial year until 2029.
The anticipated volume during this period is 100 ship sets and the final pricing reflects an increase in current prices to address post-pandemic inflationary pressures, which continue to be experienced throughout the supply chain.
Lockheed Martin will provide funding to Quickstep for the purchase of long lead materials, demonstrating the company’s commitment to the Australian supplier.
Quickstep and Lockheed Martin are currently discussing the next contract period for the C-130, which will cover the period from 2030 to 2034.
Record drone numbers
Quickstep’s Engineering Development business unit had a strong end to the 2024 financial year, delivering record drone production numbers largely in support of additional volumes from Australian partner and advanced drone development company Carbonix.
Carbonix placed an urgent $1.35 million order for 40 Volanti all-electric, fixed-wing unmanned aerial vehicles in March, followed by a $430,000 order for 20 more units.
This is believed to be the largest order received from Carbonix for this drone type.
Revenue increase
Quickstep’s revenue for the last four months of the year was approximately $1.3m, which exceeded revenues for the previous eight months.
Although the full year saw slightly softer revenues from the Structures business unit, this was offset by a 94% growth in Services revenue to over $10m and a 57% year-on-year growth in Engineering Development.
The forecast unaudited group revenue of $99m will exceed the $96m upper guidance provided in April and represents 5% yoy growth.