CON-SPACE Communications Ltd.

Established in 1991, CON-SPACE Communications Ltd. designs, manufactures and markets specialized voice communication equipment. This equipment is utilized by a broad range of customers including law enforcement, fire departments, rescue teams, military, government agencies, municipalities and general industry. Currently, CON-SPACE equipment can be found in over 1,400 fire departments in the United States, a figure that increases on a monthly basis.

The company owns subsidiaries in the U.S. and the United Kingdom and has a distribution network that encompasses North America and parts of Europe, Asia, Australia and South America.

CON-SPACE commenced operations once management recognized the need for proper voice communication for those individuals and groups working in confined spaces. At the time of the company’s inception, no products existed to provide the type of communication that CON-SPACE presently designs and manufactures.

Product Offerings

The company’s first sales originated with the marketing of its hardline communication systems. These systems are designed to provide reliable, two-way voice communication within concrete or metal surroundings. Confined spaces typically involve these types of environments where wireless radio signals cannot penetrate or escape.

CON-SPACE has since expanded its offerings to serve the portable two-way radio market. The company’s SR65i Radio Accessory products improve the functionality of portable two-way radios by making them virtually handsfree and usable while wearing facemasks, protective clothing or working in high-noise environments.

CON-SPACE’s private label or original equipment manufacturer (OEM) business has grown to become a substantial part of the company’s sales mix, presently accounting for about 45% of companywide sales. By manufacturing these communications products for outside companies, management has turned what could potentially be a competitive environment into many positive partnerships within the communications industry.

Asian Market

On October 3, 2005, CON-SPACE announced that it is actively seeking to increase the company’s presence within the Asian market. More specifically, management is increasing its focus on China, the world's fastest-growing economy. In order to take advantage of this new market potential, the company has joined the Canada Export Centre (CEC) to expand its profile for products and services in the Asian markets.

As a result of increasing demand for CON-SPACE products throughout Asia, the company is implementing a strategic business plan that is aimed at penetrating the Chinese market. Furthermore, management is contemplating the establishment of a manufacturing facility in China. In order to reach a proper decision, CON-SPACE has joined the CEC to assist with qualified introductions and negotiations.

The company now has a permanent trade booth established at the downtown Vancouver location of the CEC to facilitate the introduction of the company and its products to the many business visitors that come to Vancouver looking for opportunities. The purpose of this trade booth is to attract attention and lead to a potential business discussion to explore various opportunities.

Management stated that CON-SPACE is looking to establish a leadership presence in the Asian market within the dynamic confined space communications sector due to increasing sales originating in Asia. Accordingly, any future expansion of the company’s facilities overseas would significantly enhance CON-SPACE’s growth potential over the next several years.

Recent Developments

In August 2005, the company successfully completed a 50% expansion to its manufacturing facilities in Richmond, B.C. In order to keep up with increasing demand, the facilities were increased from about 6,000 square feet of space to 9,150 square feet. This expansion is expected to meet the company’s needs in the short-term, however, further growth may be required depending on the level of rising sales.

In early October 2005, the company reported that it had received an order for the sale of radio accessory products worth an estimated US$102,000 from Pennsylvania where CON-SPACE’s equipment was previously used to rescue nine miners working in the Quecreek mine. This purchase marks the third largest order to come directly from the Pennsylvania Emergency Management Agency (PEMA) within the last six months. The two previous orders totaled more than $228,000. The latest purchase was entirely for SR65i radio accessory products for the police departments in the counties surrounding Pittsburgh. After a series of extensive comparison tests, PEMA selected CON-SPACE products. Management stated that this development is a prime example of the increasing demand for the company’s products. This trend is expected to continue as the EMA offices in other U.S. states prepare themselves for homeland defense.