Saturday, March 26, 2011

ComDev Faces Challenges and Direct Competitors

Cambridge, Ontario based Com Dev International, newly re-organized and attempting to recover from the recent layoff of 5% of it's workforce (plus the firing of it's longtime CEO John Keating) now faces new challenges in the form of direct competition against it's exactEarth Ltd. subsidiary by Orbcomm of Fort Lee, N.J.

Both firms are looking to providing satellite-based ship monitoring for global coastal authorities, according to the March 25th, 2011 Space News article "Neck & Neck Race To Be First In Tracking Ships From Space."

Both firms also perceive this to be a far more profitable service business (with profit margins of 60% or better) than the traditional satellite parts business, where Com Dev is an acknowledged "niche" leader and where profits generally hover in the more modest 25% range.

Oddly enough, both firms have also faced recent launch delays on their selected U.S., Russian and Indian rockets and both firms are now counting on fresh launch dates in mid-2011 to field their next generation technology in a field formally know as satellite automatic identification systems (AIS).

Orbcomm is planning to make AIS capacity a feature on all 18 of its second-generation satellites, which are scheduled to be launched beginning later this year. The last of it's first generation satellites failed sometime before February 1st, 2011, according to the February 2nd, 2011 Space News article "Orbcomm Admits Key Maritime Monitoring Satellite Failed in Late 2010."

According to the March 16th, 2011 Sat News Daily article "exactEarth... An Exacting Acquisition (Satellites)" exactEarth recently purchased two existing satellites with AIS payloads from SpaceQuest Ltd. of Fairfax, Virginia as it's entry into the market and expects to add two new satellites incorporating next generation advanced on-board AIS sometime this summer.

Earlier this year, exactEarth also won a “standing offer,” worth up to $4.7 million CDN to provide data to the Canadian Space Agency (CSA) for such services as search and rescue, environmental and fisheries protection, Arctic monitoring and marine security.

According to the March 25th, 2011 article "COM DEV Financial Results Sees Military Segment Rise but Civil and Commercial Segments Decline" the company saw revenues decrease in the first quarter (Q1) of 2011 as compared to Q1 in 2010 from $56.7 million to $48.7 million but saw new orders rise to $59 million as compared to $51 million a year ago.

The company has also announced an initiative to re-purchase up to 10% of its stock.

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