Contract win details. Having competed against Elbit Systems and Safran Technology to provide Electronic Warfare Countermeasures Increment 1a to the Royal Navy, SEA’s Ancilia has won, resulting in a considerable multi-year contract (to 2033/2034) from the UK MoD worth at least £135m (with option value, details of which are classified). This contract win builds on SEA’s long-standing relationship with the Royal Navy and further validates its technology. What is SEA’s Ancilia? Developed in collaboration with Chess Dynamics, Ancilia is a trainable decoy launcher system that enhances fleet protection by rapidly responding to incoming air, surface and subsurface threats. It is compact, lightweight, modular and can be retrofitted onto existing platforms. It’s named after the 12 shields kept in the Temple of Mars in ancient Rome. With the increasing threat of new missile technology, demand for naval and ground-based air defence is accelerating and SEA and Chess’s product portfolios are positioned to benefit. Management estimates the international TAM for Ancilia alone, to be at least £250m in the next 5 years. Record order book. The order book now exceeds £500m versus £354m at 1H24 (FY cover of 95%); with visibility to 2033/34, confidence is underpinned. Upgraded forecasts. We update our forecasts to reflect recent contract wins, increasing our estimates for revenue, operating profit, EPS and net funds in both FY25E and FY26E (details overleaf). Margins rise from 11% to 12% by FY26E laying foundations to achieve mid-teen targets medium term. Valuation. The shares trade on 8.1x FY25E EV/EBITDA and 14.1x P/E. Our TP rises to 850p to reflect the upgrade in Sensors & Effectors’ outlook. Next catalysts. SEA site visit on 30 April and FY trading update in May.