TIDMGINV
RNS Number : 5141I
Global Invacom Group Limited
13 August 2021
Global Invacom Group Limited
("Global Invacom", the "Company" or the "Group")
Results for the six months ended 30 June 2021
Singapore/London, 13 August 2021 - Global Invacom (SGX: QS9)
(AIM: GINV), the global provider of satellite communications
equipment and electronics, is pleased to announce its financial
results for the six months ended 30 June 2021 ("1H FY2021").
Key financial highlights:
-- Revenue for 1H FY2021 of US$40.4m (1H FY2020: US$52.8m)
-- Gross Profit for 1H FY2021 of US$8.8m (1H FY2020: US$12.4m)
-- Net loss for 1H FY2021 of US$1.2m (1H FY2020: US$0.3m net profit)
-- Cash and cash equivalents as at 30 June 2021 of US$9.4m (31 December 2020: US$11.3m)
Key operational highlights:
-- Continued demand for Direct to Home ("DTH") products through
the Company's key customer in the United States, providing an
ongoing revenue base albeit at lower levels than previous years
-- Demand for Data Over Satellite ("DOS") products continues to
grow, driven by ongoing demand for connectivity and data delivery
through the COVID-19 pandemic
-- Global supply chains continue to be impacted by COVID-19 pandemic
-- The Group has undertaken cost reduction measures
The financial performance of the Group in the first half of 2021
reflects broader ongoing COVID-19 challenges. The much-publicised
disruption to supply chains and problems with the availability of
key products, including semi-conductors and capacitors, continues
to be a challenge for the Company. Furthermore, the Company has
also been impacted by supply chain and global transportation
network issues as a result of government restrictions, the
introduction of quarantine and additional checks and measures,
coupled with a shortage of personnel at key sites such as ports.
This has ultimately led to a delay in the transport of products
from the manufacturing facility to customer sites.
The Group delivered sales of US$ 40.4 million in the first half
of the year. Geographically, we saw ongoing sales pressure in
America, Europe and Asia, with an increase in demand across the
Rest of the World. The United States, which remains a significant
market for the Group, continues to be impacted by the ongoing
pandemic, which has translated to a fall in anticipated orders.
As reported in the FY2020 full year results statement, in 2020
the Group restructured its development, sales and marketing teams
to focus on the DOS products, a growth market, leaving just a core
team focused on the DTH markets. The Group has also undertaken, and
is continuing, a restructuring across the Group to reduce its cost
base, removing excess headcount in non-core functions, and a
reduction in administrative costs.
DOS continues to underpin 4G/5G and high-speed broadband access,
service providers are adopting satellite solutions to meet the
significant growth in demand where traditional fibre and cable
solutions are not viable. We continue to work to position ourselves
to take advantage of this potential growth in demand.
The Group's DTH products continue to generate good sales, albeit
at lower levels than in previous years. As such, we continue to
invest in the development of bespoke new products for our key
customer in the United States but have reduced the size of the team
focused on this segment.
The Group continues to monitor the pandemic situation closely,
carrying out rigorous risk assessments and implementing stringent
hygiene procedures across our sites. This has enabled us to allow
our employees to return to work safely should they wish to do so.
As a global business, the Group continues to monitor the situation
closely and to adhere to all relevant Government guidelines for the
regions in which it is present.
The challenges faced by the Group in the first half will likely
continue to impact the Group's business throughout FY2021.
Notwithstanding that, the Group believes Global Invacom's products
have a key role to play in the provision of this connectivity as
restrictions ease across territories, supply chains recover, and
demand starts to normalise.
Tony Taylor, Executive Chairman of Global Invacom,
commented:
"The first half of 2021 has been challenging as we faced down a
number of operational and macroeconomic headwinds. Despite this,
our business has delivered a solid performance, supported by a
highly skilled and talented workforce.
"As global restrictions ease, and supply chains move more
freely, I firmly believe our business is ideally placed to deliver
a sustainable recovery in the medium term."
For further information, please contact:
Global Invacom Group Limited www.globalinvacom.com
Tony Taylor, Executive Chairman via Vigo Consulting
Strand Hanson Limited (Nominated Adviser www.strandhanson.co.uk
and Broker)
James Harris / Rob Patrick Tel: +44 20 7409 3494
Vigo Consulting (UK Media & Investor Relations) www.vigoconsulting.com
Jeremy Garcia / Fiona Hetherington / Kendall Tel: +44 207 390 0238
Hill
ginv@vigoconsulting.com
About Global Invacom Group Limited
Global Invacom is a fully integrated satellite equipment
provider with sites across Singapore, China, Indonesia,
Philippines, Malaysia, Israel, UK and the US. Its customers include
satellite broadcasters such as Sky Group of the UK and Dish Network
of the USA and Data over Satellite providers including Hughes
Network Systems, Viasat and Gilat Satellite Networks.
Global Invacom provides a full range of satellite ground
equipment including antennas, LNB receivers, transceivers, fibre
distribution equipment, transmitters, switches, and video
distribution components, as well as manufacturing services for the
defence and healthcare sectors. The Group is the world's only
full--service outdoor unit supplier.
Global Invacom is listed on the Mainboard of the Singapore
Exchange Securities Trading Limited and its shares are admitted to
trading on the AIM Market of the London Stock Exchange.
For more information, please refer to www.globalinvacom.com
.
GLOBAL INVACOM GROUP LIMITED
(Incorporated in Singapore)
(Company Registration Number 200202428H)
UNAUDITED CONDENSED INTERIM FINANCIAL STATEMENTS
For the Six Months Ended 30 June 2021
Table of Contents Page
Condensed Interim Consolidated Statement of Comprehensive
A. Income 4
B. Condensed Interim Statements of Financial Position 5
C. Condensed Interim Statements of Changes in Equity 6
Condensed Interim Consolidated Statement of Cash
D. Flows 8
Notes to the Condensed Interim Consolidated Financial
E. Statements 9
Other Information Required by Listing Rule Appendix
F. 7.2 20
A. Condensed Interim Consolidated Statement of Comprehensive Income
Group
---------------------------------------------------------------------------
1H 1H Increase/
FY2021 FY2020 (Decrease)
US$'000 US$'000 %
Revenue 40,439 52,773 (23.4)
Cost of sales (31,653) (40,423) (21.7)
Gross profit 8,786 12,350 (28.9)
Other income 1,478 125 N.M.
Distribution costs (137) (115) 19.1
Administrative expenses (10,877) (11,030) (1.4)
Other operating expenses (52) (378) (86.2)
Finance income 30 21 42.9
Finance costs (352) (429) (17.9)
(Loss)/Profit before income
tax (1,124) 544 N.M.
Income tax expense (54) (202) (73.3)
--------------------------- ----------------------- ---------------------
(Loss)/Profit for the period (1,178) 342 N.M.
--------------------------- ----------------------- ---------------------
Other comprehensive income/(loss):
Items that may be reclassified
subsequently to profit or loss
* Exchange differences on translation of foreign
subsidiaries 325 (105) N.M.
Other comprehensive income/(loss)
for the period, net of tax 325 (105) N.M.
--------------------------- ----------------------- ---------------------
Total comprehensive (loss)/income
for the period (853) 237 N.M.
--------------------------- ----------------------- ---------------------
(Loss)/Profit for the period
attributable to:
Equity holders of the Company (1,177) 345 N.M.
Non-controlling interests (1) (3) (66.7)
(1,178) 342 N.M.
----------------- ------------------- -----------
Total comprehensive (loss)/income
for the period attributable
to:
Equity holders of the Company (852) 240 N.M.
Non-controlling interests (1) (3) (66.7)
(853) 237 N.M.
----------------- ------------------- -----------
N.M.: Not Meaningful
B. Condensed Interim Statements of Financial Position
Group Company
------------------------------------------- -----------------------------------------
30 Jun 31 Dec 30 Jun 31 Dec
2021 2020 2021 2020
US$'000 US$'000 US$'000 US$'000
ASSETS
Non-current Assets
Property, plant and
equipment 8,775 9,410 46 82
Right-of-use assets 5,472 6,340 105 162
Investments in
subsidiaries - - 27,102 27,102
Goodwill 6,092 6,092 - -
Intangible assets 1,998 2,291 - -
Other financial assets 8 8 - -
Deferred tax assets 1,363 1,363 - -
Other receivables and
prepayments 54 54 10,793 10,563
23,762 25,558 38,046 37,909
-------------------- --------------------- -------------------- -------------------
Current Assets
Due from subsidiaries - - 4,168 4,045
Inventories 25,714 26,816 - -
Trade receivables 13,373 10,689 - -
Other receivables and
prepayments 2,466 2,033 3,059 3,513
Tax receivables 1 - - -
Cash and cash equivalents 9,435 11,273 165 150
-------------------- --------------------- -------------------- -------------------
50,989 50,811 7,392 7,708
-------------------- --------------------- -------------------- -------------------
Total assets 74,751 76,369 45,438 45,617
-------------------- --------------------- -------------------- -------------------
EQUITY AND LIABILITIES
Equity
Share capital 60,423 60,423 74,240 74,240
Treasury shares (1,656) (1,656) (1,656) (1,656)
Reserves (12,676) (11,824) (28,441) (28,302)
-------------------- --------------------- -------------------- -------------------
Equity attributable
to owners of the Company 46,091 46,943 44,143 44,282
Non-controlling interests (17) (16) - -
-------------------- --------------------- -------------------- -------------------
Total equity 46,074 46,927 44,143 44,282
-------------------- --------------------- -------------------- -------------------
Non-current Liabilities
Other payables 124 124 - -
Lease liabilities 4,309 4,848 39 39
Deferred tax liabilities 634 634 - -
5,067 5,606 39 39
-------------------- --------------------- -------------------- -------------------
Current Liabilities
Due to subsidiaries - - 919 835
Trade payables 10,815 12,509 - -
Other payables 4,969 5,589 272 333
Borrowings 6,199 3,883 - -
Lease liabilities 1,372 1,854 65 128
Provision for income
tax 255 1 - -
-------------------- --------------------- -------------------- -------------------
23,610 23,836 1,256 1,296
-------------------- --------------------- -------------------- -------------------
Total liabilities 28,677 29,442 1,295 1,335
-------------------- --------------------- -------------------- -------------------
Total equity and
liabilities 74,751 76,369 45,438 45,617
-------------------- --------------------- -------------------- -------------------
C. Condensed Interim Statements of Changes in Equity
Attributable
to
Group equity
Foreign holders
Capital Share currency of
Share Treasury Merger redemption options Capital translation Retained the Non-controlling
capital shares reserves reserves reserve reserve reserve profits Company interests Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as
at 1 January
2021 60,423 (1,656) (10,150) 6 725 (5,109) (964) 3,668 46,943 (16) 46,927
Loss for the
period - - - - - - - (1,177) (1,177) (1) (1,178)
Other
comprehensive
loss:
Exchange
differences
on
translating
foreign
operations - - - - - - 325 - 325 - 325
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Total other
comprehensive
income/(loss)
for the
period - - - - - - 325 (1,177) (852) (1) (853)
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Balance as
at 30 June
2021 60,423 (1,656) (10,150) 6 725 (5,109) (639) 2,491 46,091 (17) 46,074
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Balance as
at 1 January
2020 60,423 (1,656) (10,150) 6 725 (5,109) (1,217) 1,054 44,076 (11) 44,065
Profit/(Loss)
for the
period - - - - - - - 345 345 (3) 342
Other
comprehensive
loss:
Exchange
differences
on
translating
foreign
operations - - - - - - (105) - (105) - (105)
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Total other
comprehensive
(loss)/income
for the
period - - - - - - (105) 345 240 (3) 237
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Balance as
at 30 June
2020 60,423 (1,656) (10,150) 6 725 (5,109) (1,322) 1,399 44,316 (14) 44,302
------------------- ------------------- ------------------- --------------------- ------------------- -------------------- ---------------------- ----------------- -------------------- -------------------- -----------------
Foreign
Share currency
Share Treasury options Capital translation Accumulated
Company capital shares reserve reserve reserve losses Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as at
1 January 2021 74,240 (1,656) 725 (4,481) (2,506) (22,040) 44,282
Loss for the
period - - - - - (139) (139)
Other comprehensive
loss:
Exchange differences - - - - - - -
on translating
foreign operations
---------- ----------- ---------- ---------- ------------- -------------- --------
Total other comprehensive
loss for the
period - - - - - (139) (139)
---------- ----------- ---------- ---------- ------------- -------------- --------
Balance as at
30 June 2021 74,240 (1,656) 725 (4,481) (2,506) (22,179) 44,143
---------- ----------- ---------- ---------- ------------- -------------- --------
Balance as at
1 January 2020 74,240 (1,656) 725 (4,481) (2,506) (20,591) 45,731
Loss for the
period - - - - - (391) (391)
Other comprehensive
loss:
Exchange differences - - - - - - -
on translating
foreign operations
---------- ----------- ---------- ---------- ------------- -------------- --------
Total other comprehensive
loss for the
period - - - - - (391) (391)
---------- ----------- ---------- ---------- ------------- -------------- --------
Balance as at
30 June 2020 74,240 (1,656) 725 (4,481) (2,506) (20,982) 45,340
---------- ----------- ---------- ---------- ------------- -------------- --------
D. Condensed Interim Consolidated Statement of Cash Flows
Group
-----------------------------------------
1H 1H
FY2021 FY2020
US$'000 US$'000
Cash Flows from Operating Activities
(Loss)/Profit before income tax (1,124) 544
Adjustments for:
Depreciation of property, plant and equipment 1,143 1,388
Amortisation of intangible assets 266 446
Depreciation of right-of-use assets 996 1,076
Gain on disposal of property, plant and equipment (1,143) -
(Write-back)/Allowance for inventory obsolescence (2) 19
Impairment of trade receivables - 274
Bad debts written off 17 -
Unrealised exchange loss/(gain) 124 (53)
Interest income (30) (21)
Interest expense 352 429
Gain on lease modifications (207) -
Operating cash flow before working capital changes 392 4,102
Changes in working capital:
Inventories 1,104 (1,256)
Trade receivables (2,702) (324)
Other receivables and prepayments 422 (395)
Trade and other payables (2,424) (2,756)
-------------------- -------------------
Cash used in operating activities (3,208) (629)
Interest paid (116) (60)
Income tax paid (2) -
Net cash used in operating activities (3,326) (689)
-------------------- -------------------
Cash Flows from Investing Activities
Interest received - 21
Purchase of property, plant and equipment (679) (966)
Proceeds from disposal of property, plant and equipment 581 -
Net cash used in investing activities (98) (945)
-------------------- -------------------
Cash Flows from Financing Activities
Proceeds from borrowings 17,026 23,238
Repayment of borrowings (14,710) (21,906)
Principal payment of lease liabilities (740) (1,109)
Net cash generated from financing activities 1,576 223
-------------------- -------------------
Net decrease in cash and cash equivalents (1,848) (1,411)
Cash and cash equivalents at the beginning of the period 11,273 8,912
Effect of foreign exchange rate changes on the balance of cash held in
foreign currencies 10 (23)
-------------------- -------------------
Cash and cash equivalents at the end of the period 9,435 7,478
-------------------- -------------------
E. Notes to the Condensed Interim Consolidated Financial Statements
1. General Information
Global Invacom Group Limited (the "Company") is a public limited
company incorporated and domiciled in Singapore and is listed on
the Mainboard of the Singapore Exchange Securities Trading Limited
("SGX-ST"). The Company is also listed on the AIM Market of the
London Stock Exchange ("AIM") in the United Kingdom (UK). These
condensed interim consolidated financial statements as at and for
the six months ended 30 June 2021 comprise the Company and its
subsidiaries (the "Group"). The principal activity of the Company
is that of an investment holding company.
The principal activities of the Group are design, manufacture
and supply of a full range of satellite ground equipment, including
antennas, LNB receivers, transceivers, fibre distribution
equipment, transmitters, switches and video distribution
components.
2. Basis of Preparation
The condensed interim financial statements for the six months
ended 30 June 2021 have been prepared in accordance with Singapore
Financial Reporting Standards (International) ("SFRS(I)") 1-34
Interim Financial Reporting issued by the Accounting Standards
Council Singapore. The condensed interim financial statements do
not include all the information required for a complete set of
financial statements. However, selected explanatory notes are
included to explain events and transactions that are significant to
an understanding of the changes in the Group's financial position
and performance of the Group since the last annual financial
statements for the year ended 31 December 2020.
The accounting policies adopted are consistent with those of the
previous financial year which were prepared in accordance with
SFRS(I)s and International Financial Reporting Standards ("IFRSs"),
except for the adoption of new and amended standards as set out in
Note 2.1.
The condensed interim financial statements are presented in
United States dollar which is the Company's functional
currency.
2.1 New and amended standards adopted by the Group
There has been no change in the accounting policies and methods
of computation adopted by the Group for the current reporting
period compared with the audited financial statements for the year
ended 31 December 2020, except for the adoption of new or revised
SFRS(I) and interpretations of SFRS(I) ("INT SFRS(I)") that are
mandatory for the financial year beginning on or after 1 January
2021. The adoption of these SFRS(I) and INT SFRS(I) has no
significant impact on the Group.
2.2 Use of judgements and estimates
In preparing the condensed interim financial statements,
management has made judgements, estimates and assumptions that
affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expense. Actual
results may differ from these estimates.
The significant judgements made by management in applying the
Group's accounting policies and the key sources of estimation
uncertainty were the same as those that applied to the consolidated
financial statements as at and for the year ended 31 December
2020.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected.
Information about critical judgements in applying accounting
policies that have the most significant effect on the amounts
recognised in the financial statements is included in the following
notes:
-- Note 9 - capitalised development costs
-- Note 11 - impairment test on property, plant and equipment
-- Note 12 - impairment test on investments in subsidiaries
Information about assumptions and estimation uncertainties that
have a significant risk of resulting in a material adjustment to
the carrying amounts of assets and liabilities within the next
interim period are included in the following notes:
-- Note 10 - impairment test of goodwill: key assumptions underlying recoverable amounts
-- Note 11 - useful lives of property, plant and equipment
3. Seasonal Operations
The Group's businesses are not affected significantly by
seasonal or cyclical factors during the six months ended 30 June
2021.
4. Segment and Revenue Information
The Group is organised into the following main business
segments:
-- Satellite C ommunications ("Sat Comms"); and
-- Contract Manufacturing ("CM")
These operating segments are reported in a manner consistent
with internal reporting provided to the executive directors who are
responsible for allocating resources and assessing performance of
the operating segments.
4.1 Reportable segments
Sat
Comms CM Group
US$'000 US$'000 US$'000
1H FY2021
Revenue 40,439 - 40,439
======== ======== ========
Operating loss (785) (17) (802)
======== ========
Finance income 30
Finance costs (352)
Income tax expense (54)
--------
Loss for the Period (1,178)
========
Amortisation of intangible assets 266 - 266
Depreciation of property, plant
and equipment 1,143 - 1,143
Depreciation of right-of-use assets 996 - 996
Addition to property, plant and
equipment 679 - 679
Bad debts written off - 17 17
Gain on lease modifications (207) - (207)
Write-back for inventory obsolescence,
net (2) - (2)
Sat
Comms CM Group
US$'000 US$'000 US$'000
Assets and liabilities
Segment assets 70,826 1,825 72,651
Unallocated assets
- Non-current assets 46
- Other receivables 85
- Deferred tax assets 1,363
- Cash and cash equivalents 500
- Tax receivables 1
- Right-of-use assets 105
--------
Total assets 74,751
========
Segment liabilities 19,581 1,570 21,151
Unallocated liabilities
- Other payables 334
- Provision for income tax 255
- Deferred tax liabilities 634
- Borrowings 6,199
- Lease liabilities 104
--------
Total liabilities 28,677
========
1H FY2020
Revenue 51,174 1,599 52,773
======= ====== =======
Operating profit 875 77 952
======= ======
Finance income 21
Finance costs (429)
Income tax expense (202)
-------
Profit for the period 342
=======
Amortisation of intangible assets 446 - 446
Depreciation of property, plant
and equipment 1,387 1 1,388
Depreciation of right-of-use assets 1,014 62 1,076
Addition to property, plant and
equipment 966 - 966
Impairment loss on trade receivables 274 - 274
Allowance for inventory obsolescence,
net 58 (39) 19
------- ------ -------
Assets and liabilities
Segment assets 80,032 1,239 81,271
Unallocated assets
* Non-current assets 138
* Other receivables 97
* Deferred tax assets 975
* Cash and cash equivalents 274
* Tax receivables 1
* Right-of-use assets 88
-------
Total assets 82,844
=======
Segment liabilities 18,870 1,606 20,476
Unallocated liabilities
* Other payables 306
* Provision for income tax 143
* Deferred tax liabilities 428
* Borrowings 10,261
* Lease liabilities 6,928
-------
Total liabilities 38,542
=======
4.2 Disaggregation of revenue
The Group's revenue is disaggregated by principal geographical
areas, major product lines and timing of revenue recognition.
Group
1H 1H
FY2021 FY2020
US$'000 US$'000
Principal geographical market
America
- Sale of goods 23,165 35,862
-------- --------
Europe
- Sale of goods 10,997 12,059
-------- --------
Asia
- Sale of goods 1,209 2,014
-------- --------
Rest of the World
- Sale of goods 5,068 2,838
-------- --------
Total 40,439 52,773
======== ========
Major product lines
Sale of goods 40,439 52,773
======== ========
The Group recognises revenue from sale of goods at a point in
time, when the Group satisfies a performance obligation and the
customers obtain control of the goods.
5. Financial Assets and Financial Liabilities
Set out below is an overview of the financial assets and
financial liabilities of the Group as at 30 June 2021 and 31
December 2020:
Level 1 Level 2 Level 3 Total
US$'000 US$'000 US$'000 US$'000
Group and Company
30 June 2021
Financial asset at fair value
through other comprehensive
income - - 8 8
======== ======== ======= =======
31 December 2020
Financial asset at fair value
through other comprehensive
income - - 8 8
======== ======== ======= =======
5.1 Significant items
Group
1H 1H
FY2021 FY2020
US$'000 US$'000
Interest income 30 21
Interest expense (352) (429)
Gain on disposal of property, plant and
equipment 1,143 -
Gain on lease modifications 207 -
Impairment of trade receivables - (274)
Loss on foreign exchange (34) (102)
Bad debts written off (17) -
Write-back/(Allowance) for inventory obsolescence 2 (19)
Depreciation of property, plant and equipment (1,143) (1,388)
Depreciation of right-of-use assets (996) (1,076)
Amortisation of intangible assets (266) (446)
Research and development expense (792) (881)
5.2 Related party transactions
There are no material related party transactions apart from
those disclosed elsewhere in the condensed interim financial
statements.
6. Taxation
The Group calculates the period income tax expense using the tax
rate that would be applicable to the expected total annual
earnings.
7. Earnings Per Share
Earnings per ordinary share of the Group, after deducting any provision for preference Group
dividends
1H 1H
FY2021 FY2020
US$ US$
------------- ------------
(a) Based on weighted average number of ordinary shares on issue; and (0.43) cent 0.13 cent
(b) On a fully diluted basis (0.43) cent* 0.13 cent*
Weighted average number of ordinary shares used in computation of basic earnings per
share 271,662,227 271,662,227
Weighted average number of ordinary shares used in computation of diluted earnings per
share 271,662,227 271,662,227
------------- ------------
* Diluted earnings per share are the same as the basic earnings
per share because the potential ordinary shares to be converted are
anti-dilutive as the effect of the share conversion would be to
increase the earnings per share.
8. Net Asset Value
Group Company
30 Jun 2021 31 Dec 2020 30 Jun 2021 31 Dec 2020
US$ US$ US$ US$
------------ ------------ ------------ ------------
Net asset value per ordinary share based on issued share 16.97 cents 17.28 cents 16.25 cents 16.30 cents
capital
Total number of issued shares 271,662,227 271,662,227 271,662,227 271,662,227
------------ ------------ ------------ ------------
9. Fair Value Measurement
The Group and the Company categories fair value measurement
using a fair value hierarchy that is dependent on the valuation
inputs used as follows:
(i) quoted prices (unadjusted) in active markets for identical
assets or liabilities that the Group can access at the measurement
date (Level 1);
(ii) inputs other than quoted prices included within Level 1
that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices) (Level
2); and
(iii) inputs for the asset or liability that are not based on
observable market data (unobservable inputs) (Level 3).
The following table presents the financial assets and financial
liabilities measurement at fair value as at the statement of
financial position date by level of the fair value hierarchy:
Level 1 Level 2 Level 3 Total
US$'000 US$'000 US$'000 US$'000
Group and Company
30 June 2021
Financial asset at fair
value through other comprehensive
income - - 8 8
======== ======= ======= =======
31 December 2021
Financial asset at fair
value through other comprehensive
income - - 8 8
======== ======= ======= =======
9.1 Fair value of the Group's and the Company's financial assets
and liabilities that are measured at fair value on a recurring
basis
The Group and Company's financial asset, at fair value through
profit or loss as at the statement of financial position date is
considered not significant.
9.2 Fair value of the Group's and the Company's financial assets
and liabilities that are not measured at fair value on a recurring
basis (but fair value disclosure is required)
(i) The carrying amounts of financial assets and liabilities
with a maturity of less than 1 year, which include cash and cash
equivalents, borrowings, receivables and payables are assumed to
approximate their fair values due to their short-term
maturities.
(ii) The carrying amount of non-current portion of loans to
subsidiaries, non-current portion of other payables and non-current
lease liabilities to the financial statements are reasonable
approximation of their fair value.
9.3 Valuation Policies and Procedures
The Group and the Company has established a control framework
with respect to the measurement of fair values. This framework
includes the finance team that reports directly to the Chief
Executive Officer and has overall responsibility for all
significant fair value measurements, including Level 3 fair
values.
The finance team regularly reviews significant unobservable
inputs and valuation adjustments. If third party information is
used to measure fair value, then the finance team assesses and
documents the evidence obtained from the third parties to support
the conclusion that such valuations meet the requirements of
SFRS(I), including the level in the fair value hierarchy the
resulting fair value estimate should be classified.
Significant valuation issues are reported to the Company's Audit
and Risk Committee.
10. Intangible Assets
Intellectual Capitalised
Trading property development
name rights costs Total
US$'000 US$'000 US$'000 US$'000
Group
2021
Cost
Balance at 1 January
and 30 June 16 2,674 4,834 7,524
Amortisation and impairment
Balance at 1 January 16 757 4,460 5,233
Amortisation charge - 113 153 266
Currency realignment - 27 - 27
-------- ------------- ------------- --------
Balance at 30 June 16 897 4,613 5,526
-------- ------------- ------------- --------
Net book value
Balance at 30 June - 1,777 221 1,998
======== ============= ============= ========
2020
Cost
Balance at 1 January 16 2,685 4,823 7,524
Currency realignment - (11) 11 -
-------- ------------- ------------- --------
Balance at 31 December 16 2,674 4,834 7,524
-------- ------------- ------------- --------
Amortisation and impairment
Balance at 1 January 16 483 3,921 4,420
Amortisation charge - 250 539 789
Currency realignment - 24 - 24
-------- ------------- ------------- --------
Balance at 31 December 16 757 4,460 5,233
-------- ------------- ------------- --------
Net book value
Balance at 31 December - 1,917 374 2,291
======== ============= ============= ========
11. Goodwill
Group
30 June 2021 31 December
2020
US$'000 US$'000
Cost
Balance at the beginning and end
of the period 9,352 9,352
============= ============
Allowance for impairment loss
Balance at the beginning and end
of the period 3,260 3,260
Net carrying amount 6,092 6,092
============= ============
11.1 Allocation of goodwill
Goodwill has been allocated to the Group's cash generating unit
("CGU") identified according to the business segment as
follows:
Group
30 June 2021 31 December
2020
US$'000 US$'000
Satellite Communications
- OnePath Networks Limited ("OPN")
- Israel 893 893
- Satellite Acquisition Corporation
("SAC") - United States of America 5,199 5,199
------------- ------------
6,092 6,092
============= ============
12. Property, Plant and Equipment
Furniture,
Machinery fittings
Freehold & Motor &
property equipment vehicles equipment Renovations Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Group
2021
Cost
Balance at 1 January 2,883 17,639 40 7,649 1,458 29,669
Currency realignment - (18) - 11 (1) (8)
Additions - 627 - 51 1 679
Balance at 30
June 2,883 18,248 40 7,711 1,458 30,340
--------- ---------- --------- ----------- ------------ ---------
Accumulated
Depreciation
Balance at 1 January 928 11,187 40 6,969 1,135 20,259
Currency realignment - 153 - 11 (1) 163
Depreciation charge 20 1,010 - 79 34 1,143
Balance at 30
June 948 12,350 40 7,059 1,168 21,565
--------- ---------- --------- ----------- ------------ ---------
Net book value
Balance at 30
June 1,935 5,898 - 652 290 8,775
========= ========== ========= =========== ============ =========
2020
Cost
Balance at 1 January 2,807 28,069 220 8,377 1,376 40,849
Currency realignment 76 (12) - 53 184 301
Additions - 1,462 - 410 104 1,976
Disposals - (146) - - (10) (156)
Write-off - (11,734) (180) (1,191) (196) (13,301)
Balance at 31
December 2,883 17,639 40 7,649 1,458 29,669
--------- ---------- --------- ----------- ------------ ---------
Accumulated
Depreciation
Balance at 1 January 849 20,640 220 7,629 1,257 30,595
Currency realignment - 419 - (1) (1) 417
Depreciation charge 79 1,963 - 532 75 2,649
Disposals - (101) - - - (101)
Write-off - (11,734) (180) (1,191) (196) (13,301)
Balance at 31
December 928 11,187 40 6,969 1,135 20,259
--------- ---------- --------- ----------- ------------ ---------
Net book value
Balance at 31
December 1,955 6,452 - 680 323 9,410
========= ========== ========= =========== ============ =========
Furniture,
fittings
&
equipment Renovations Total
US$'000 US$'000 US$'000
Company
2021
Cost
Balance at 1 January and 30 June 211 80 291
Accumulated depreciation
Balance at 1 January 137 72 209
Depreciation charge 28 8 36
Balance at 30 June 165 80 245
----------- ------------ --------
Net book value
Balance at 30 June 46 - 46
=========== ============ ========
2020
Cost
Balance at 1 January 209 80 289
Additions 2 - 2
Balance at 31 December 211 80 291
----------- ------------ --------
Accumulated depreciation
Balance at 1 January 76 45 121
Depreciation charge 61 27 88
Balance at 31 December 137 72 209
----------- ------------ --------
Net book value
Balance at 31 December 74 8 82
=========== ============ ========
The proceeds from disposal of property, plant and equipment of
US$581,000 and gain on disposal of property, plant and equipment of
US$1,143,000 pertains to machinery and equipment that was fully
written off in the prior financial year ended 31 December 2020.
13. Investment in Subsidiaries
Company
30 Jun 31 Dec
2021 2020
US$'000 US$'000
Unquoted equity shares, at cost 40,533 40,533
Accounting for employee share options 725 725
Currency realignment 131 131
Less: Allowance for impairment loss (14,287) (14,287)
27,102 27,102
========= =========
Movement in the allowance for impairment
loss are as follows:
At the beginning of the period 14,287 13,803
Impairment loss recognised during the period - 484
--------- ---------
At the end of the period 14,287 14,287
========= =========
Allowance for impairment loss
(i) Global Invacom Manufacturing Pte Ltd ("GIMPL")
As at 30 June 2021 and 31 December 2020, an allowance for
impairment loss of US$8,648,000 was made on the cost of investment
in GIMPL, as the allocated CGU, to which the investment relates to,
was incurring losses from operations due to the restructuring costs
incurred. The recoverable amount was based on management's estimate
of the fair value less costs to sell, with reference to the fair
value of the net assets of GIMPL, which is considered to be Level 3
in the fair value hierarchy.
(ii) Global Invacom Holdings Limited and its subsidiaries ("GIHL Group")
As at 30 June 2021 and 31 December 2020, an allowance for
impairment loss of US$5,639,000 was made on the cost of investment
in GIHL Group, as the allocated CGU, to which the investment
relates to, was incurring losses from operations. The recoverable
amount was based on management's estimate of the fair value less
costs to sell, with reference to the fair value of the net assets
of GIHL Group, which is considered to be Level 3 in the fair value
hierarchy.
14. Borrowings
Aggregate amount of group's borrowings and debt securities.
Amount repayable in one year or less, or on demand
As at 30 Jun 2021 As at 31 Dec 2020
Secured Unsecured Secured Unsecured
--------- -------- ---------
US$'000 US$'000 US$'000 US$'000
--------- -------- ---------
6,199 - 3,883 -
--------- -------- ---------
Amount repayable after one year
As at 30 Jun 2021 As at 31 Dec 2020
Secured Unsecured Secured Unsecured
--------- -------- ---------
US$'000 US$'000 US$'000 US$'000
--------- -------- ---------
- - - -
--------- -------- ---------
The revolving credit loans of US$6,199,000 were secured over the
assets of the subsidiaries and corporate guarantees provided by the
Company and the subsidiaries.
15. Share Capital
1H FY2021 No. of shares US$'000
Balance as at 1 Jan 2021 and 30 Jun
2021 271,662,227 72,584
-------------------- -----------
1H FY2020 No. of shares US$'000
Balance as at 1 Jan 2020 and 30 Jun
2020 271,662,227 72,584
-------------------- -----------
There were 10,740,072 treasury shares held by the Company as at
30 June 2021 and 30 June 2020 and there was no subsidiary
holdings.
Total number of issued shares excluding treasury shares as at
the end of the current financial period and as at the end of the
immediately preceding year:
30 Jun 2021 31 Dec 2020
Total number of issued shares excluding treasury shares 271,662,227 271,662,227
------------ ------------
Total number of treasury shares as at the end of the current
financial period reported on:
1H FY2021 No. of shares US$'000
Balance as at 1 Jan 2021 and 30 Jun
2021 10,740,072 1,656
-------------- --------
16. Subsequent events
There are no known subsequent events which have led to
adjustments to this set of interim financial statements.
F. Other Information Required by Listing Rule Appendix 7.2
1. Review
The condensed consolidated statement of financial position of
Global Invacom Group Limited and its subsidiaries as at 30 June
2021 and the related condensed interim consolidated statement of
comprehensive income, condensed interim statements of financial
position, condensed interim consolidated statement of changes in
equity and condensed interim consolidated statement of cash flows
for the six-month period then ended and certain explanatory notes
have not been audited or reviewed by the auditors.
2. Review of Performance of the Group
2.1 Review of Financial Performance
Revenue
T he Group's revenue for the six months ended 30 June 2021 ("1H
FY2021") decreased by 23.4% to US$40.4 million from US$52.8 million
in the prior year ("1H FY2020"). The current COVID-19 pandemic
situation has impacted the business of the Group globally. The
Group has seen a reduction in orders from our customers and
selected impact on our production facilities around the world as we
adapted our working practices to comply with regional variations on
social distancing and best practices during this pandemic.
Geographically, the Group's revenue for 1H FY2021 decreased in
America, Europe and Asia by US$12.7 million (-35.4%), US$1.1
million (-8.8%) and US$0.8 million (-40.0%), respectively, offset
by an increase in Rest of the World by US$2.2 million (+78.6
%).
Gross Profit
The decrease in revenue has resulted in a 28.9 % decrease in
gross profit from US$12.4 million in 1H FY2020 to US$ 8.8 million
in 1H FY2021. Gross profit margin has decreased marginally by 1.7
percentage points from 23.4% to 21.7 %, mainly attributable to
higher materials, shipping and logistics costs due to the ongoing
pandemic and supply chain constraints.
Other Income
Other income in 1H FY2021 was derived mainly from gains on the
disposal of equipment of US$1.1 million, gain on lease
modifications of US$0.2 million, with the remainder comprising
subsidy support received from various government bodies across the
Group due to the pandemic.
Administrative Expenses
Administrative expenses for 1H FY2021 decreased 1.4 % to US$
10.9 million compared to US$11.0 million in 1H FY2020, representing
26.9 % and 20.9% of revenue, respectively. The ongoing cost control
measures across the Group globally, coupled with reduction in
travelling, marketing, trade shows etc. during this pandemic period
has resulted in lower administrative expenses incurred.
Other Operating Expenses
Other operating expenses in 1H FY2021 were attributed mainly to
foreign exchange losses and bad debts written off.
Profit Before Tax & Net Profit
The Group posted a loss before tax of US$ 1.1 million in 1H
FY2021, compared to a profit of US$0.5 million in 1H FY2020.
Overall, the Group posted a net loss of US$ 1.2 million in 1H
FY2021, compared to a net profit of US$0.3 million in 1H
FY2020.
2.2 Review of Financial Position
Non-current assets decreased by US$1.8 million to US$23.8
million as at 30 June 2021, due to the depreciation of plant and
equipment, the right-of-use assets and the amortisation of
intangible assets.
Net current assets increased by US$0.4 million to US$27.4
million as at 30 June 2021 compared to US$27.0 million as at 31
December 2020. Trade and other receivables increased by US$3.1
million due to slower collections, offset by a decrease in
inventories and trade and other payables of US$1.1 million and US$
2.3 million respectively, resulting from inventory control, longer
shipment lead times and continuing payment to suppliers.
Cash and cash equivalents decreased by US$1.8 million to US$9.4
million as at 30 June 2021 from US$11.3 million at 31 December 2020
and borrowings increased by US$2.3 million to US$6.2 million as at
30 June 2021 from US$3.9 million as at 31 December 2020.
Provision for income tax increased by US$0.3 million and the
repayment of leases has resulted in a decrease of US$0.5 million in
the current portion of lease liabilities.
With the repayment of leases, the non-current portion of the
lease liabilities decreased by US$0.5 million to US$4.3 million as
at 30 June 2021.
The Group's net asset value stood at US$46.1 million as at 30
June 2021, compared to US$46.9 million as at 31 December 2020.
2.3 Review of Cash Flows
In 1H FY2021, net cash used in operating activities amounted to
US$3.3 million, comprising US$0.4 million cash inflow from
operating activities (before working capital changes), US$3.6
million net working capital outflow and US$0.1 million payment of
interest and income tax.
Net cash used in investing activities in 1H FY2021 amounted to
US$0.1 million, mainly due to the purchase and proceeds from the
disposal of machinery and equipment.
Net cash generated from financing activities amounted to US$1.6
million in 1H FY2021, attributable to the net proceeds of
borrowings offset by the repayment of lease liabilities.
Overall, the Group recorded a net decrease in cash and cash
equivalents amounting to US$1.8 million in 1H FY2021, bringing cash
and cash equivalents per the consolidated statement of cash flows
to US$9.4 million as at 30 June 2021.
3. Where a forecast, or a prospect statement, has been
previously disclosed to shareholders, any variance between it and
the actual results.
No prospect statement was made.
4. A commentary at the date of the announcement of the
significant trends and competitive conditions of the industry in
which the group operates and any known factors or events that may
affect the group in the next reporting period and the next 12
months.
The COVID-19 global pandemic has continued to impact sales and
profit growth in the period. We have now implemented processes
enabling our employees to return to work safely should they wish to
do so. As a global business, the Group continues to monitor the
situation closely and to adhere to all relevant Government
guidelines for the regions in which it is present and has adopted
stringent hygiene procedures and safe-distancing measures
throughout the business.
The Group's manufacturing sites have continued to experience
delays due to global supply chains and availability of core
components within its key markets, which has adversely impacted the
Group's growth as well as our customers' sales. Equally, shutdowns
in certain territories and geographies have also adversely impacted
our sales.
Global Invacom's products are expected to play a crucial role in
meeting global demand for data and connectivity in the future. The
COVID-19 pandemic has served to accelerate global demand for
constant connectivity and service providers are increasingly
seeking satellite solutions where traditional fibre and cable
networks aren't suitable or capable of satisfying demand.
According to Fortune Business Insights, the global satellite
market was valued at US$23.4 billion in 2020 and is projected to
grow to US$46.5 billion by 2028, driven by universal demand for
greater connectivity, coupled with the launch of smaller satellites
for use across multiple industries including civil engineering,
energy, oil and gas and others. [1]
The Group delivered 1H FY2021 sales of US$40.4 million, with
lower demand in America, Europe and Asia, offset by increased
demand across the Rest of the World. The United States remains a
significant market for the Group.
The challenges faced by the Group in the first half will
continue to impact the Group's business throughout FY2021.
Notwithstanding that, the Group believes Global Invacom's products
have a key role to play in the provision of this connectivity as
restrictions ease across territories, supply chains recover, and
demand starts to normalise.
5. Dividend
(a) Current Financial Period Reported On
Any dividend declared for the current financial period reported
on?
None.
(b) Corresponding Period of the Immediately Preceding Financial Year
Any dividend declared for the corresponding period of the
immediately preceding financial year?
None.
(c) Date payable
Not applicable.
(d) Books closure date
Not applicable.
6. If no dividend has been declared/recommended, a statement to
that effect and the reason(s) for the decision.
Due to the operating conditions faced by the Group, no dividend
has been declared or recommended for the six months ended 30 June
2021.
7. If the Group has obtained a general mandate from shareholders
for Interested Person Transactions ("IPTs"), the aggregate value of
such transactions as required under Rule 920(1)(a)(ii). If no IPTs
mandate has been obtained, a statement to that effect.
The Company does not have a shareholders' mandate for IPTs for
the six months ended 30 June 2021.
CONFIRMATION PURSUANT TO RULE 705(5) OF THE LISTING MANUAL
We do hereby confirm, for and on behalf of the Board of Global
Invacom Group Limited (the "Company"), that to the best of our
knowledge, nothing has come to the attention of the Board of the
Company which may render the financial results for the six months
ended 30 June 2021 to be false or misleading in any material
aspect.
CONFIRMATION PURSUANT TO RULE 720(1) OF THE LISTING MANUAL
Global Invacom Group Limited confirms that undertakings under
Rule 720(1) have been obtained from all its directors and executive
officers in the format set out in Appendix 7.7.
On behalf of the Board
Anthony Brian Taylor Gordon Blaikie
Executive Director Executive Director
BY ORDER OF THE BOARD
Anthony Brian Taylor
Executive Chairman
13 August 2021
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
[1] fortunebusinessinsights.com/satellite-communication-satcom-market-102679
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END
IR QLLFFFVLLBBK
(END) Dow Jones Newswires
August 13, 2021 02:00 ET (06:00 GMT)
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