Micro-Cap Signs Significant Contract with Chinese City of Kaili

By: AllPennyStocks.com News

July 15, 2009
The latest news provides yet another shining example of what a rich and, as yet, not fully-tapped market China is now and continues to become, with recession still gripping Western economies and only slowly starting to let go. Once protected from the outside world by a so-called “bamboo curtain”, China is turning to more conventional – dare we say, Western – methods of keeping its citizens safe from harm. And, more to the point of this story, a Canadian company is helping.

In mid-July, Vancouver-based Cantronic Systems Inc. (TSX-Venture:CTS), signed a Safe City contract with the southwestern city of Kaili, in Guizhou province, to provide digital security and video surveillance equipment. At the last census, Kaili had a population topping half a million, and is taking on with it big city problems like crime. Construction on the project, which is worth around $2.4 million Canadian, should take up to five months to complete.

Kaili Safe City project is Cantronic's first project acting as a primary contractor for the Safe City projects, possible only after CTS received its National Level Class 1 Construction and Installation licence in April.

Cantronic manufactures, distributes, and provides training and services in the fields of infrared vision and video security surveillance technologies, specializing in passive and active infrared cameras, infrared illuminators, low light infrared sensitive CCD cameras and long-range night vision surveillance systems for demanding homeland security and surveillance application. In a decade when awareness of community security was heightened by the events of 9-11, CTS’ success in obtaining this contract is significant.

Among its most significant products is the TR300S, a cost effective surveillance solution with fast autofocus and unbelievably sharp image quality. The camera is based on advanced VOx technology, realizing high-performance thermal imaging, is nitrogen-purged and pressurized, and can detect man-sized threats at two kilometers with its 100-millimetre lens.

CTS can also fill needs presented by current worldwide flu pandemic, with the Fever Scan M3000 System, a thermal imaging camera designed for mass-screening of public areas. The system finds individuals with elevated body temperatures so that they can be detained for further testing. The M3000 is ideal for SARS screening, avian flu (bird flu) and swine flu (H1N1) detection in areas such as airports, railway/subway stations, and other crowded areas.

Cantronic has developed monitoring and display software applications and has a worldwide patent pending for its Long Distance Illuminator. Cantronic's products have been installed by the U.S. Navy for the protection of naval installations and by Fromatone for nuclear power plant protection. Other notable customers include Northrup Grumman, General Motors, Johnson Controls and Tyco Fire and Safety.

And the recession appears to be nearing an end for this company. Financial results announced early in July indicate a sharp rise in revenues. For the first quarter ended on April 30, Cantronic recorded revenues of $1.13 million compared with about $400,000 during the previous quarter. Indeed, Cantronic's financial results appear to have improved over the last three quarters, as a slowdown in spending spread its pall over the world.

Perhaps the tidings from China are reflective of a recovery all-around for this company, an improvement that may make itself felt in CTS’ stock price, which peaked last August at 40 cents a share, before the recession chilled everything and dropped the price to seven cents. The events of mid-July raised the price around 16 cents on fairly heavy volume.

Copyright © 2009 AllPennyStocks.com. All rights reserved. Republication or redistribution of AllPennyStocks.com's content is expressly prohibited without the prior written consent of AllPennyStocks.com. AllPennyStocks.com shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.