Global Invacom

Global Invacom (formerly Radiance): The satellite communications company is planning for greater involvement in the Asia-Pacific. A boost for this strategy came in 4Q12 when it secured a US$20 m contract from a major Asian customer, involving the supply of satellite comms eqpt to an unnamed major player in the Asian satellite pay TV market. CEO Tony Taylor, said at a media briefing yesterday that the move was of strategic importance, giving the co an Asia footprint. Prior to this, it was very much US and Europe-centric. He now expects Asia to contribute around 25% of sales. Separately, in response to rising costs of production in China, the co is currently subcontracting certain parts of its manufacturing process to a third party in Selangor, Malaysia, but will be opening its own facility sometime this quarter. Global Invacom picked Malaysia after considering among others, Vietnam and India. However, most of the manufacturing, especially the high-margin ones, will remain in China. Mr Taylor expects Asia to contribute more to the company's bottomline in the years to come. He said that the company is aware of the dangers of moving too fast, especially after a quality control debacle it had experienced last year. The company had run into quality control problems that affected 3 pdts for a major US customer. Product recalls subsequently led the group to record a $1.2m loss in FY12. But Mr Taylor added that new quality controls have been put in place and that relations with the affected customer have not been jeopardised. He expected business with the affected party to continue, and assured investors that the whole debacle will have little impact on FY13 performance and after. The stock is +0.6% at $0.18.