LONDON (Alliance News) - AIM-listed satellite communications company Global Invacom Group Ltd Friday reported a swing to a pretax loss for its first half, hit by delayed sales to three of its major customers, although it expects to return to operating profitability in its second half.
For the half year to end-June, the company reported a pretax loss of USD2.6 million, swung from a pretax profit of USD4.3 million a year before, as revenue fell to USD54.0 million from USD69.8 million.
Global Invacom attributed the fall in revenue to delayed sales to major customers as a result of destocking or changes in procurement procedures. A majority of the delayed orders have now resumed, and the company said it expects to see an improvement in its second half.
Gross profit margin fell to 20.7% from 24.9% as a result of the reclassification of products in relation to import duty taxes to the US that it is contesting.
Additionally, administration costs increased 7.8% in the half year as a result of the integration of its acquisition of Foxcom and an ongoing legal dispute with a supplier of its UK subsidiary, as well as restructuring costs related to a UK site and manufacturing improvements at the Shanghai facility.
"We remain resolute in our goal to position ourselves as the global leader in Sat Comms equipment and remain optimistic of our operating performance for the second half," said Executive Chairman Tony Taylor in a statement.
Shares in Global Invacom are untraded Friday morning. They last closed at 13.23 pence.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @hanassallnews
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