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Independent Reviews for Venture Investors

BYL.TO - Puzzling.

Updated: Nov 4, 2022

Baylin Technologies Inc. (BYL.TO) is a diversified global wireless technology management company which focuses on research, design, development, manufacturing and sales of passive and active radio-frequency products.

Coverage was initiated on September 2020 with additional notes on May 2021 and January 2022.

News Releases

Jan. 31 - Announces Recent Developments at its Advantech Wireless Division;

i) Advantech was recently awarded a multi-year contract to supply SSPA ("Solid State Power Amplifier") systems to a US-based sports video broadcast company. The systems will be integrated into a fleet of hundreds of mobile satellite communications trucks for the purpose of broadcasting live sporting events. The retrofit will begin in Q1 2022.

ii) Additionally, Advantech received an award from a major Latin American customer to supply SSPAs for a military RADAR system. In this instance, the amplifiers will enable the simultaneous tasks of surveillance, classification, location, and graphic visualization of aerial targets. This award is a multi-year supply agreement.

iii) Also, in the SSPA category, Advantech received a substantial order from a major telecommunications operator for more than 100 SSPA systems and more than 100 frequency converters for a network that provides communications links between schools, post offices and other state government facilities. Most sites are located in US rural locations.

Mar. 9 - Announces Financial Results for Fiscal 2021

Mar. 30 - Announces Fully Approved Status with Tier One North American Carrier: Galtronics USA subsidiary has recently been fully approved by a Tier One North American carrier to sell its DAS, Inbuilding, Stadium and Venue infrastructure products throughout the United States. Galtronics is now fully approved at all three of the largest US carriers for in building installations. This development allows the Galtronics sales team to sell directly into this new customer nationally. Employees of all three US carriers will be able to access in the internal purchasing systems.

Apr. 11 - Receives Purchase Order of Over $700k (CAD) from United States Carrier: Galtronics USA subsidiary received a purchase order of over $700,000 (CAD) from a US carrier for its macro antennas. The antennas will be used for their continued LTE upgrade. The Galtronics macro antennas are a comparatively lightweight solution that can support growing capacity and throughput requirements. The customer chose a combination of three Galtronics models that support low and mid band requirements for the current LTE networks and eventual 5G roll-out.

Apr. 20 - Receives its First Order for Smart City 5G Solution: Galtronics USA subsidiary has received its first in a series of expected orders from a Smart City Solutions Provider who has partnered with a Tier 1 US carrier to deploy its small cell antennas on streetlights to help accelerate the carrier's 5G roll-out across the United States.

May 11 - Announces Financial Results for the First Quarter of 2022

June 14 - Receives $1.5 Million Purchase Order From Major Maritime Service Provider: Advantech Wireless Technologies (AWT) subsidiary has received a purchase order of over $1.5 Million (CAD) for amplifiers from a major maritime service provider. The amplifiers will be installed on cruise ships to enable Wi-Fi coverage.

July 11 - Embedded Antenna Selected By US Computer Networking Hardware Company: To provide a wireless solution to a Major US Telecommunications Service Provider. Galtronics will provide the antennas for a 5G mobile hotspot solution which allows service provider's users to utilize a 5G internet connection with multi-gigabit speeds at home and on the move. It was awarded a multi-year contract and shipped over $500,000 CAD in product, year to date.

Aug. 10 - Announces the Appointment of New Director: Bejoy Pankajakshan will add valuable insight and industry expertise to the board.Mr. Pankajakshan is currently Executive Vice President, Chief Technology and Strategy Officer at Mavenir Systems, Inc, located in Richardson, Texas. Mavenir is a privately-owned, multinational global telecoms vendor focused on software-based automated networks.

Aug. 10 - Announces Financial Results for the Second Quarter of 2022: i) Net debt(3) was $21.4 million as at June 30, 2022, an increase of $9.1 million from December 31, 2021, mainly due to an increase in non-cash working capital, capital expenditures and interest payments. ii) Credit Facility: In July 2022, the Company and its lenders (Royal Bank of Canada and HSBC Bank Canada) agreed to a further amendment to the Credit Agreement to reduce the minimum liquidity the Company is required to maintain from $10 million to $7.5 million. The Company believes that this will provide additional flexibility to invest in working capital and inventory, in particular in order to actively manage supply chain challenges and long lead times, and to support deliveries against historically high backlog levels.

Outlook: Expect that H2 2022 will be similar in both revenue and Adjusted EBITDA to H1 2022.

Sep. 6 - Announces the Genesis Product Line: Advantech Wireless Technologies announced the release of Genesis, a new solid-state power amplifier ("SSPA") platform for satellite communications. Genesis is the first in a series of new product releases that will take the Advantech portfolio to a new level in terms of features and benefits.

Sep. 15 - Announces Amendments to its Credit Facilities: Agreed with its principal lenders, Royal Bank of Canada and HSBC Bank Canada, to amend the Credit Agreement dated March 29, 2019, to extend the maturity date of the revolving and term credit facilities from September 30, 2022, to September 29, 2023.

The Company is also pleased to announce that its Vietnamese subsidiary, Galtronics Vietnam Dai Dong Company Limited ("GTD"), has agreed with its lender, HSBC Bank (Vietnam) Ltd., to various amendments to its credit facility agreement, including an extension of the maturity date of the facility from August 18, 2022, to August 18, 2023.

Sep. 22 - Subsidiary, Galtronics USA, Expands its Industry-Leading Multibeam Antenna Portfolio:The new antenna products are build on Galtronics first multi-beam antenna, which has been successfully deployed by a Tier 1 US carrier throughout the United States over the past 18 months. The new products cover multiple spectrum bands, enabling Galtronics to sell to all major US and Canadian wireless carriers.

Galtronics' proprietary multi-beam technology overcomes legacy issues which have previously prevented widespread adoption of multi-beam antenna technology. The three new antenna products all utilize patent pending beam-tracking stability technology, which make them ideal solutions for stadium, venue, and special event deployments.

Nov. 2 - to Host Third Quarter 2022 Investor Conference Call Thursday November 10th, 2022, at 8 a.m. ET



Advantech Wireless.

A multi-year contract with US based sports video broadcaster company to supply Solid State Power Amplifier systems (SSPA) to be integrated in mobile satellite truck for broadcasting live sporting events was awarded in January 2022. Also another award for a military radar system (surveillance, classification, and visualization of targets) was obtained from a with Latin America customer. In addition, substantial orders (>100) from a major telecommunications operator were reported for solid-state power amplifier (SSPA) and frequency converters.

Furthermore a $1.5M order from a maritime service provider for amplifiers to will provide connectivity on cruise ships was disclosed in June 2022. Finally, a new solid-state power amplifier ("SSPA") platform for satellite communications (Genesis) was launch in September 2022.. It was referred to a "first in a series of new product releases".


March 2022, Galtronics USA was approved to to sell DAS, In-building, Stadium and Venue Infrastructure products at another US Carriers. This is the third approval of its kind (with the top three largest US carriers) and is significant as employees of these companies will be able to access Galtronics' products in the internal purchasing systems.

April 2022, a $0.7M PO was received from a US Carrier for Galtronics' macro antennas which will be used for LTE upgrades. In the same month, Galtronics also received a first of many future expected orders from a Smart City Solution Providers partnered with a Tier 1 US carrier to deploy small cell antennas.

July 2022, an $0.5M order for the provision of embedded antennas to a US Networking Hardware company for a 5G hotspot solution was received. September 2022, the expansion of its Multibeam Antenna Portfolios was announced. The new products cover multiple spectrum bands, enabling sales to all major US and Canadian wireless carriers


September 2022, Royal Bank of Canada and HSBC Bank Canada both agreed to amend the Credit Agreement extending the maturity date to September 29, 2023. Similarly, Galtronics Vietnam Dai Dong (GTD), agreed with HSBC Bank (Vietnam) Ltd. to various amendments including extending the maturity date; August 18, 2023


FY 2021 represented a third consecutive year of revenue decline. In addition, Net losses were impacted due to

"operating loss which included non-current asset impairments of $26.0 million, income tax expense, which included a $7.1 million reduction in the carrying value of deferred tax assets, as well as a fair value adjustment to the Debentures"

However, YTD 2022 revenues are ahead of both YTD 2021 and YTD 2020. More importantly, net losses are materially improved which suggests that changes in the way the organization is deploying its resources. As of Q2 2022, backlog were at almost $39M which represents consecutive growth over the last seven quarters.


Bejoy Pankajakshan was appointed as an independent board member. He is currently Executive Vice President, Chief Technology and Strategy Officer at Mavenir Systems, Inc which is a privately-owned, multinational global telecoms vendor focused on software-based automated networks.

In short

Despite delivering improved revenues, lower net losses and growing backlog, valuation has sunk from $0.95 to $0.20 cents. Granted markets have been punishing but the extent of this slide in the stock price needs to be examined.

From August, Baylin lost about $0.10 a month in valuation and this with a relatively low average volume. In the last three months, 14 days had volume over 50K. As a result, there appears to be some engineering at play.

However, one cannot ignore the absence of support in the price.

At Q2 2022 earnings (August 10th) no guidance was issued but the outlook provided was to expect that H2 2022 would be similar to H1. This along with the appointment of the independent director from Mavenir seems to have been the initial catalysts for the current decline. It's ironic given the Interim Consolidated Statement of June 30th stated:

In assessing the Company’s ability to continue as a going concern, management has a reasonable expectation that the Company will be able (i) to fund operating and debt service requirements for the next 12 months and (ii) to refinance the Revolving Facility and Term Loan when they mature on September 30, 2022.

On August 11th, Raymond James issued a $1.10 price target. On September 17th (at $0.33 cents) Baylin was reported by the Globe and Mail among the Top 10 Undervalued Hardware Industry Stocks. Only two days after the company reported an extension of its credit facilities with Royal Bank of Canada and HSBC Bank Canada.

There also has not been any insider transactions reported that would support the current decline. As a reminder, Mr. Royer via 2385796 Ontario Inc. maintains a 54.8% ownership. Despite all that, Baylin closed at $0.20 cents!

No doubt, the current valuation is puzzling.

DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The content of rally is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions - rally cannot take responsibility for your investment decisions.


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