Structural Monitoring Systems (ASX:SMN) subsidiary AEM wins U.S. navy contract for V-22 Osprey

Structural Monitoring Systems (ASX:SMN) is sharpening its profile in the international aerospace and defence sector, following news that its wholly owned subsidiary, Anodyne Electronics Manufacturing Corp (AEM), will supply magnetic amplifiers for the U.S. Navy’s fleet of V-22 Osprey tilt-rotor aircraft.

The contract was announced jointly by the Canadian Commercial Corporation (CCC) and AEM, highlighting the trusted role that Canadian manufacturers continue to play in supplying advanced technologies to the U.S. Department of Defense.

The agreement covers the delivery of magnetic amplifiers, which form a critical part of the Osprey’s audio and intercommunication systems.

These units are designed to deliver long-term reliability and stable performance in the extreme operating conditions faced by military aircraft.

According to CCC, the deal is an example of how Canadian aerospace expertise is contributing to one of the most advanced aircraft programs in the world.

The V-22, which can take off and land like a helicopter but fly with the range and speed of a fixed-wing plane, remains a cornerstone of U.S. Navy and Marine Corps operations.

“Through this contract, AEM continues to demonstrate its reputation as a trusted partner in the defence aerospace sector,” CCC stated.

Strategic value to Structural Monitoring Systems

For Structural Monitoring Systems, the news underscores the strategic importance of its 2017 acquisition of AEM, which today operates across three business lines:

• AEM Avionics – providing communications and related systems for aerospace and defence customers.

• AEM Contract Manufacturing – offering design and production services to global clients.

• CVM™ (Comparative Vacuum Monitoring) – SMS’s flagship structural health monitoring technology for aircraft fuselage and wings.

While Structural Monitoring Systems is best known for developing its CVM™ technology, which allows airlines and regulators to replace scheduled heavy inspections with continuous monitoring solutions, the AEM acquisition provided the group with an immediate revenue stream and strong customer base across both commercial and defence aviation.

The latest U.S. Navy order illustrates how AEM’s established avionics business continues to deliver defence-related income, complementing Structural Monitoring Systems long-term growth ambitions in structural health monitoring.

Expanding presence in U.S. defence markets

The CCC-AEM partnership also highlights how SMS, through AEM, is deepening its footprint within U.S. defence supply chains.

Contracts tied to programs such as the V-22 Osprey reinforce AEM’s status as a tiered supplier to major aerospace primes and position Structural Monitoring Systems to benefit from repeat and follow-on orders.

Coverage in SkiesMag further underlined the commercial significance of the deal, noting that AEM’s technology supports U.S. Navy operational readiness through rugged, proven components.

With structural health monitoring solutions gradually being adopted by leading regulators and operators, and with avionics sales into high-profile defence platforms such as the V-22, SMS is increasingly viewed as a diversified aerospace technology group rather than a single-product company.

Strategic Direction

Looking ahead, Structural Monitoring Systems is expected to continue leveraging its dual-track business model:

• building on AEM’s stable revenue from avionics and defence manufacturing, and

• scaling CVM™ technology adoption across global fleets, including potential certification milestones with regulators.

The combination provides investors with exposure to both near-term recurring revenue and long-term disruptive growth potential.

The official CCC announcement can be found here.

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