MIRA INFORM REPORT

 

 

Report No. :

336739

Report Date :

18.08.2015

 

IDENTIFICATION DETAILS

 

Name :

NORSAT INTERNATIONAL, INC.

 

 

Registered Office :

110 – 4020 Viking Way, Richmond, British Columbia V6V 2L4

 

 

Country :

Canada

 

 

Date of Incorporation :

15.10.1982

 

 

Legal Form :

Public Company

 

 

Line of Business :

Subject provides communication solutions that enable the transmission of data, audio, and video for various applications and environments

 

 

No. of Employees :

168

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

Clear

 

 

NOTES:

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

 

 

ECGC Country Risk Classification List – March 31, 2015

 

Country Name

Previous Rating

(31.12.2014)

Current Rating

(31.03.2015)

Canada

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

CANADA - ECONOMIC OVERVIEW

 

As a high-tech industrial society in the trillion-dollar class, Canada resembles the US in its market-oriented economic system, pattern of production, and high living standards. Since World War II, the impressive growth of the manufacturing, mining, and service sectors has transformed the nation from a largely rural economy into one primarily industrial and urban. The 1989 US-Canada Free Trade Agreement (FTA) and the 1994 North American Free Trade Agreement (NAFTA) (which includes Mexico) touched off a dramatic increase in trade and economic integration with the US, its principal trading partner. Canada enjoys a substantial trade surplus with the US, which absorbs about three-fourths of Canadian merchandise exports each year. Canada is the US's largest foreign supplier of energy, including oil, gas, and electric power, and a top source of US uranium imports. Given its abundant natural resources, highly skilled labor force, and modern capital plant, Canada enjoyed solid economic growth from 1993 through 2007. Buffeted by the global economic crisis, the economy dropped into a sharp recession in the final months of 2008, and Ottawa posted its first fiscal deficit in 2009 after 12 years of surplus. Canada's major banks, however, emerged from the financial crisis of 2008-09 among the strongest in the world, owing to the early intervention by the Bank of Canada and the financial sector's tradition of conservative lending practices and strong capitalization. Canada achieved marginal growth in 2010-14 and plans to balance the budget by 2015 despite the recent drop in oil prices. In addition, the country's petroleum sector is rapidly expanding, because Alberta's oil sands significantly boosted Canada's proven oil reserves. Canada now ranks third in the world in proved oil reserves behind Saudi Arabia and Venezuela and is the world’s fifth-largest oil producer.

 

Source : CIA


Company Name and summary

 

Company name:            NORSAT INTERNATIONAL, INC.

 

Address:                                   110 – 4020 Viking Way, Richmond, British Columbia V6V 2L4 Canada

 

Telephone:                    +1 604-821-2800

 

Fax:                              +1 604-821-2801

 

Website:                                   www.norsat.com

 

Corporate ID#:              BC-0000255727   

 

State:                           British Columbia

 

Judicial form:                Public Company (TSX=NII and NYSE:NSAT)

 

Date incorporated:        10-15-1982

 

Stock:                           5,831,658 shares issued and outstanding

 

Value:                           -

 

Name of manager:         Amiee CHAN

 

 

ACTIVITIES & OPERATIONS

 

IST

 

Business:

 

Norsat International Inc. provides communication solutions that enable the transmission of data, audio, and video for various applications and environments in Canada, the United States, Europe, and other countries.

 

It operates through three segments: Sinclair Technologies, Satellite Solutions, and Microwave Products. The Sinclair Technologies segment offers radio frequency (RF) antennas, including base station antennas, mobile/transit antennas, and covert antennas; and RF filter products, such as cavity filters, transmitter combiners, duplexers, isolators, circulators, and receiver multi-couplers. This segment serves public safety operators, including police forces, coast guards and navies, and a set of ambulance and fire dispatch services; private sector networks comprising rail, ground, and air transportation networks; original equipment manufacturers; and mobile radio, public safety, aviation, and heavy transport industries.

 

The Satellite Solutions segment provides GLOBETrekker, Norsat Rover, and SigmaLink fly-away satellite terminals, as well as RANGER, an assisted-acquire micro-sat terminal; and SATCOM baseband kits for worldwide satellite system field deployments. The Microwave Products segment designs, develops, and markets microwave components comprising satellite receivers, transmitters, transceivers, solid-state power amplifiers, and other microwave components that enable the transmission, reception, and amplification of signals to and from satellites. This segment serves resellers, system integrators, antenna manufacturers, and service providers.

The company was formerly known as NII Norsat International, Inc. and changed its name to Norsat International Inc. in July 1999.

Norsat International Inc. was founded in 1977 and is headquartered in Richmond, Canada.

Customers include Chevron, PetroChina, BC Hydro, Motorola, Tessco,

General Dynamics, First Nations Communities of British Columbia,

US Department of Defense, NATO…

 

Staff:    168

 

 

Operations & branches:

 

At the headquarters, we find the corporate office.

 

The Company maintains several branches in Canada including the one located:

 

85 Mary Street

Aurora, Ontario L4G 6X5

 

 

SHAREHOLDERS & MANAGERS

 

Shareholders:

 

The Company is listed with the TSX under symbol NII and the NYSE under symbol

NSAT.

 

 

Management:

 

The Board of Directors includes:

Fabio DONINELLI, Chairman
Joseph CAPRIO
James TOPHAM
Peter CICERI
Amiee CHAN

 

Amiee CHAN, President and CEO

He has been the Chief Executive Officer and President of Norsat International Inc. since September 8, 2006.

Dr. Chan served as Vice President of Operations at Norsat International from June 2004 to September 8, 2006 and also served as its Chief Operating Officer.

 

She has 10 years of experience in management including strategic planning, product development, technology commercialization and go-to-market planning. She was previously with Norsat from 1998 to 2002, where she directed the Engineering Department. Prior to rejoining Norsat, she oversaw the product marketing, commercialization and launch of a product line for CREO Inc. She has extensive design and production experience with RF and microwave circuits and antennas and was instrumental in developing the first Norsat portable terminal products. She has been a Director of Norsat International Inc. since August 5, 2009. She serves as a Trustee of Canada Science & Technology Museum Corporation. She is an innovator and leading authority in her field with a number of credited publications and patents.

Dr. Chan holds a Bachelor of Applied Science in 1992 and PhD in Electrical Engineering from the University of British Columbia in 2000 and an MBA from Simon Fraser University in 2003.

 
Arthur CHIN, CFO
Ken BROOM, General Manager, Sinclair Division 

 

 

Subsidiaries and partnership:

 

Norsat International (UK) Limited, Lincoln, U.K.
Norsat International (America) Inc., Richmond, VA
Norsat SA, Laussane, Switzerland
Sinclair Technologies Limited, Somersham, U.K.

 

 

FINANCIALS

 

On attachment:

- 10K 2014

- 2nd 10Q 2015

 

On August 6, 2015, Norsat International Inc. reported unaudited consolidated earnings results for the second quarter and six months ended June 30, 2015.

 

For the quarter, total sales were $8,950,091 compared to $9,583,906 a year ago. Earnings before income taxes were $806,819 compared to $716,942 a year ago. Net earnings were $674,109 or $0.12 per basic and diluted share compared to $999,897 or $0.17 per basic and diluted share a year ago. Adjusted EBITDA was $1.2 compared to $1.3 million in the second quarter of 2014. EBITDA was $1.144 million compared to $1.052 million a year ago. Net cash used in operating activities were $1,135,126 against net cash flows from operating activities of $988,717 a year ago. Purchase of intangible assets, property and equipment was $43,454 against $99,994 a year ago.

 

For the six months, total sales were $17,360,416 compared to $18,701,611 for the same period last year.  Earnings before income taxes increased to $1,232,313 compared to $2,823,896 a year ago. Net earnings were $1,233,796 or $0.21 per basic and diluted share compared to $3,176,643 or $0.55 per basic and diluted share a year ago. Adjusted EBITDA was $2.103 million compared to $2.926 million a year ago.

 

EBITDA was $1.913 million compared to $3.512 million a year ago. Net cash used   in operating activities were $1,358,935 against net cash flows from operating activities of $613,231 a year ago. Purchase of intangible assets, property and equipment was $99,549 against $210,424 a year ago.

 

As the company look forward to the second half of 2015, the company expects its revenues to be higher compared to the same period in 2014. Looking into overall 2015 annual revenue growth compared to 2014, the company expects modest improvement as strength in the second half offsets the weakness from the first half of the year.

In contrast the company's Land Mobile Radio division's revenue is expected to be lower than 2014, due to ongoing softness in its Canadian markets and the adverse effect of converting Canadian dollar denominated sales to US dollars.

 

Banks:  HSBC Bank

            Royal Bank of Canada

 

 

LEGAL FILINGS

 

Legal filings & complaints:

As of today date, there is no legal filing pending with the Courts.

 

Secured debts summary:  

None

 

 

COMPANY CREDIT HISTORY

 

Trade references:

 

Date reported:               July 2015

High credit:                   CAD 60,000

Now owing:                   0

Past due:                      0

Last purchase:              June 2015

Line of business:           Office supply

Paying status:               On terms

 

Date reported:               July 2015

High credit:                   CAD 220,000

Now owing:                   0

Past due:                      0

Last purchase:              June 2015

Line of business:           Payroll

Paying status:               As agreed

 

Date reported:               July 2015

High credit:                   CAD 1,000

Now owing:                   0

Past due:                      0

Last purchase:              June 2015

Line of business:           Telecommunications

Paying status:               On terms

 

 

Domestic credit history:

National Credit Bureaus gave a satisfying credit risk.

According to our credit analysts, during the last 6 months, domestic payments were made on due date.

 

 

Other comments:

The Company is developing its business.

The Company is in good standing.

This means that all local and federal taxes were paid on due date.

The risk is low.

 

 

Our opinion:

A business connection may be conducted.


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.65.22

UK Pound

1

Rs.102.23

Euro

1

Rs.72.39

 

 

 

 

 

INFORMATION DETAILS

 

Analysis Done by :

KIN 

 

 

Report Prepared by :

NIT

 

 

RATING EXPLANATIONS

 

RATING

STATUS

PROPOSED CREDIT LINE

 

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

 

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

 

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

 

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

 

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

 

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

 

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

Credit not recommended

 

--

NB

New Business

--

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                  Payment record (10%)

Credit history (10%)                   Market trend (10%)                                Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.