GLOBAL INVACOM: Launches into New Growth Orbit

Global Invacom Executive Chairman, Tony Taylor (Photo: Company)

Executive Chairman Tony Taylor's odyssey with satellite communications equipment supplier Global Invacom Group Ltd began 10 years ago - through a single handshake.

The company, which is listed in both London and Singapore, began operations in 1986 as Global Communications Ltd, founded by Roger and Helen Pannell in the kitchen of their semi-detached Essex home.

Taylor, who previously held roles in IT businesses ranging from semiconductors and automotive electronics to military and industrial components, was introduced to the founders in 2006 when they decided to retire.

Before he accepted the job, the Bachelor of Science with Honours graduate from UK's Coventry University was forced to do some serious soul-searching.

"It was all in a handshake - there was never any offer in writing from Roger, and I kept asking myself, 'Should I trust this guy?'," Taylor recalled.

There was also a stark contrast between his previous job and the prospective one.

"I was running a big facility, with lots of machines and people, and when my son saw the manor house that the business was based in, he went 'Dad, don't do it!'," he grinned.

"But of course, I did."

And it proved to be a tempestuous journey.

The Group then had a sister company - Invacom Ltd - which was loss-making.

"We had two sales teams, two business development teams, two finance teams, and they were all calling the same customers. It was obvious we needed to get the two entities together, but it wasn't easy - there were many egos at stake," he said.

Global Invacom Ltd was finally established in April 2008. After buying Roger and Helen out and restructuring the merged company, Taylor ran into another snag.

"At that point, some of our senior directors said they wanted to sell out. I was very disappointed, but I was able to line up a deal to sell the business to private equity for a good price."

All of us threw in every penny we had, and pooled enough money to do the GO to take control of the company.

- Tony Taylor
Executive Chairman

Global Invacom

The RTO process, initiated in November 2010, was riddled with challenges.

"It was a long and painful procedure that took 17 months, bogged down by many legal and technical issues. While we learnt an amazing amount in that time, many of us were wondering, 'Why bother with this? Why not do something else instead?'," he said.

Taylor's stubborn streak, however, refused to let him abandon the project. "It's easy, when something isn't going as well as you would hope, to step away. But if it's important, you need to keep at it, and get through to the end."

The successful RTO resulted in the Group's backdoor listing on SGX in June 2012. Two years later, Global Invacom shares were admitted to trading on the AIM Market of the London Stock Exchange.

Global Invacom has a market capitalisation on SGX of about S$44 million. Between 2012 and 2015, its revenues grew from US$74.7 million to US$129.1 million. While the Group was loss-making in 2012 and 2015, it reported net income of US$7.8 million in 2013 and US$4.3 million in 2014.

Since then, its fortunes have turned. The Group swung to a net profit of US$0.7 million for the three months ended 30 September 2016 from a net loss of US$2.7 million in the year-ago period, marking its second straight quarter in the black.

In the year-to-date, Global Invacom shares have generated a total return of 9.6%, compared with 4.2% for the FTSE ST All-Share Index and 2.1% for the benchmark Straits Times Index (STI).

On hindsight, spearheading the merger of the Global Invacom Group, as well as facilitating the company's subsequent listings in Singapore and London, were key milestones in his career, Taylor said.

Like a stomach-churning rollercoaster ride, those experiences swung him from wild elation to deep despair. Despite this, there are no regrets.

"If I had to do it all again, I wouldn't have done anything differently, really," he added.

Robust prospects aside, the spectre of increasing costs continues to loom large. "A big challenge is keeping costs down and staying competitive, because at the crux of it, we're using space technology with military precision, and offering it at consumer prices," Taylor said.

Staying abreast of advancements in the industry is another must, and Global Invacom's ability to develop new technologies in partnership with its suppliers is a key advantage.

The Group has 59 granted patents, a further 65 patent applications, and a 30-year track record of pioneering new products.

"Being innovators in the industry, we usually get invited by major broadcasters to jointly come up with designs, and that's a privilege," Taylor said.

"So we keep an eye on what's on the horizon, share our vision of where the technology is going, and decide if that fits our sweet spot. Options range from doing it ourselves, buying a development team, or using an existing team."

To decompress from work, the fan of US singer-songwriter James Taylor and Irish rock band The Script throws himself into his guitar. He has a collection of at least a dozen acoustic folk guitars, with one strategically placed in every office location.

"My wife would go nuts if she knew how many guitars I have," he chortled.

"I usually strum a few songs before dinner or when I'm in my hotel room. It's really therapeutic - helps me get my mind off work and focus on something totally different."

Apart from music, Taylor, 54, is passionate about bringing out the best in his staff and colleagues.

"It's great to be able to impart to people things that you've learnt the hard way. If you're able to teach them early in their career, it can help them progress further and faster," noted the father of a son, 22, and a daughter, 20.

His favourite books are "The Goal" by Israeli business management guru Eliyahu Goldratt, and "How to Become a CEO" by marketing consultant Jeffrey J Fox. He usually keeps spare copies of these titles to pass on to friends and colleagues.

"I really loved 'How to Become a CEO'. I first spotted that book in an airport bookstore after my flight was delayed, and my first reaction was, 'C'mon, be serious!'," Taylor grinned.

"But after I read it, it really changed my life - it got me to quit my job then and move on to something else."

Also at the top of Taylor's list are principles of honesty, openness and integrity.

"Those values cover so much ground, don't they?" he smiled. "But really, you can lose your integrity only once."

• The 3Q 2016 results mark the Group's second consecutive quarter of profitability. It intends to build on this turnaround in the coming quarters as it reaps the benefits of its restructuring and cost improvement initiatives.
• The integration of the Group's US subsidiary Raven Antenna Systems - previously trading as Skyware Global - has progressed significantly, although there are further improvements and R&D projects to complete. It will recognise Global Skyware's first full-year revenue contribution in FY2016.
• The Group is exploring the potential consolidation of its activities in China under its wholly owned subsidiary, Global Invacom Manufacturing (Shanghai) Co Ltd, to optimise manufacturing cost efficiencies. Critical equipment and customer inventory from the Group's Shenzhen subsidiary may be transferred to the Shanghai subsidiary.
• The Group believes the expected launch of two new communication satellites in the coming months by a leading US broadcaster will underpin demand for its next-generation SatComms products.
• Despite global concerns about Brexit, the Group remains upbeat. The weakening of the pound against major currencies has provided, and is expected to continue providing, short-term FX benefits for the Group's UK-based operating costs. Revenue from its SatComms sales, as well as bulk of its raw material spend, is predominantly transacted in US dollars.
• The Group remains mindful of the significant change that recently swept the satellite ground equipment industry with the introduction of digital channel stacking switch (DCSS) technology. This impacted the Group's FY2015 performance as major customers had to destock, and this effect will likely persist for the rest of FY2016.
• The Group has completed research on next-generation Low Noise Blocks (LNBs) that support DCSS, and has secured approval from a main customer to supply LNBs. Being one of only two main suppliers for this project, this approval marks a significant achievement for the Group, which has invested in next-generation LNBs since 2014.