Global Invacom recovers losses in third quarter

Global Invacom, an AIM listed satellite communications equipment provider, swung to a third quarter net profit of $0.7m, up from a loss of $2.7m incurred in the previous period.

The group’s second consecutive quarter of profitability came on the back of increased demand in the US for the company’s electronics products.

Gross profit also rose by 15.4% to $7.2m. Gross profit margin improved to 22.6% from 19.5% due to a favourable product mix, improved efficiency and tighter factory cost control.

Revenue for the third quarter was basically down by a marginal 0.4% to $32.1m due to a $2.3m reduction in the Electronics Manufacturing services and lower year-on-year sales orders in Asia.

With the inclusion of Global Skyware third quarter revenue from America and Europe rose $2.3m and $0.5m respectively offset by a fall in revenue from Asia and the rest of the world by $2.1m and $0.8m respectively.

Earnings per share on fully diluted basis was 0.26 cents compared to a loss per share of 1.04 cents in the previous period.

The group has also completed the first phase of research and development for next generation Low Noise Block products that support digital channel stacking switch technology. It has secured production approval for column supply to its largest customer which will commence in the fourth quarter.

Executive chairman Tony Taylor said: “The group-wide restructuring and cost improvement has clearly contributed to our second consecutive quarter of profit. We have consolidated our supply chain, strengthened our management team and widened our sales network. We will continue to build on this momentum to drive sustainable growth and strengthen our global leadership in the R&D and production of Sat Comms equipment.”

The share price rose 11.25% to 8.9p at 1034 GMT on Friday.