Companies: VLK   

Microwave radio and satellite transmission specialist Vislink is bullish despite a 66 per cent interim profits slide to £2.3 million pre-tax.

The fully-listed company, where entrepreneurial investor Bob Morton holds 21 per cent, managed only a minimal increase in turnover to £46.6 million in the six months to June, which it blames on a change in the product mix of its US radio frequency business and higher costs finishing a major programme. However, chief executive Ian Scott-Gall (soon to be replaced by ex-Carlyle Group luminary Duncan Lewis) points out the company more than doubled its first-half cash inflow to £5.8 million and ended June with net cash almost doubled to £6.5 million.

Acquisitive Vislink is now optimistic about its latest corporate deals, in particular yesterday’s purchase of California-based Pacific Microwave Research (PMR) for up to £9.1 million, depending on performance, with a initial £5.4 million funded out of existing bank facilities. PMR specialises in analogue and digital microwave video transmission solutions for US defence, law enforcement and 'homeland security’ and is winning contracts in the USA’s £500 million ‘L-band relocation’ programme.

Directors argue Vislink could be in line for part of a hefty US Army Reserve antennae order coming via BAE Systems. Meanwhile, the company’s Norwegian subsidiary Hernis is winning useful closed circuit TV orders.

Vislink argues many of the orders in prospect are for five years or even more and suggests it is unlikely either of the contenders for the White House would so affront the US military-industrial complex as to scrap them. At 25.5p, down from 110.5p at the end of 2006, the shares have medium-term recovery possibilities even in today’s climate.

Vislink	LSE	£28.4m	20.50p	-1.25p
Click here for interactive charting
Other company articles:
US prospects cheer Vislink			22/08/2008
Morton’s moves			21/02/2008
Vislink			30/03/2007
Faces turn towards AIM			29/08/2006
Investec			08/08/2006