SINGAPORE (May 11): Satellite communications equipment provider Global Invacom has announced US$0.6 million ($0.85 million) in earnings for the 1Q ended March 31, reversing from its loss of US$0.7 million in the comparable period last year.
The turnaround was lifted by a full quarter of profit which was recorded for the first time in a while by Global Invacom’s US subsidiary, Ravens Antenna Systems (Global Skyware), which was acquired by the group on 24 Aug 2015.
Global Skyware designs and manufactures antennas for broadband, satellite and very small aperture terminals covering C-band, Ku-band and Ka-band frequency platforms.
Group revenue fell 10.5% to US$27.5 million from $30.7 million in the previous year, mainly due to lower turnover in the contract manufacturing segment following the closure of a noncore manufacturing subsidiary in Shenzhen, China, which was completed in 4Q16.
The group’s manufacturing activity in China is now consolidated at its manufacturing facility in Shanghai.
Revenue from America, Europe and Asia regions declined by 3.5% to US$0.7 million, 29.8% to US$2.2 million, and 20.1% to US$0.5 million respectively – while revenue from the rest of the world increased by 10.7% to US$0.1 million.
Gross profit margin increased to 21.9% compared to 18.5% the previous year, helped by on-going manufacturing efficiencies across the group, and specifically at Global Skyware in the US. At the same time, lower research and development costs due to the weakened UK pound helped the group with its costs in the UK.
Administrative expenses decreased to US$5.1 million from US$6.3 million 1Q16 due to operational cost savings from restructuring, rationalisation and consolidation exercises across the group.
Earnings per share on a fully diluted basis improved to 0.22 US cent for 1Q17, a swing back into profitability from a loss per share of 0.24 US cent a year earlier.
Net asset value per share edged up to 19.45 US cents from 19.26 US cents as at 31 December 2016.
Global Invacom has commenced sales of next generation Low Noise Blocks (LNBs) utilising Digital Channel Stacking Switch (DCSS) technology – which allows up to 32 continuous video streams from a single LNB – as global broadcasters began transitioning to the latest DCSS based solutions.
The group expects sales of DCSS-generation products to increase throughout FY17.
“This set of results underscores the strong foundation we have laid to improve the group’s performance. The better margins and improved bottom line reflect the consolidation of our global manufacturing network and supply chain, as well as our efforts to expand our product portfolio through ongoing research and development and acquisitions,” says Tony Taylor, executive chairman of Global Invacom.
“We intend to build on this momentum throughout FY2017 and beyond as we roll out DCSS-generation equipment for our broadcaster customers and Ka VSAT antenna’s for the rapidly growing fleet of HTS (High Throughput Satellites), providing data over satellite around the world.”
Shares of Global Invacom closed flat at 17 cents on Tuesday.
