Baylin Technologies Backlog Hits Record C$61M After Kaelus Acquisition

Key Points

• Baylin Technologies’ firm purchase-order backlog reached a record C$61 million, up from C$20.4 million, following its acquisition of Kaelus and stronger satellite communications sales. Revenue conversion will vary by business line, with infrastructure products generally turning into revenue faster than custom antenna and satellite programs.
• The Kaelus acquisition broadened Baylin’s product portfolio, geographic reach and customer relationships, including ties to Ericsson and Nokia, while creating cross-selling opportunities with Baylin’s North American infrastructure business. Kaelus adds cell-tower antenna, synchronization, RF conditioning and testing technologies.
• Baylin reported improved infrastructure gross margins of more than 60% and sees growth potential in satellite communications and defense, despite muted North American wireless infrastructure spending expected through late 2026. Net debt stood at approximately C$11 million after the transaction, while the fully diluted share count rose to roughly 245–247 million.

Baylin Technologies TSE: BYL reported a record backlog of C$61 million in firm purchase orders following its acquisition of Kaelus, as the company seeks to expand its wireless infrastructure, satellite communications and custom antenna businesses.

Chief Executive Officer Leighton Carroll said the backlog increased from C$20.4 million and reflects contributions from Kaelus as well as increased sales activity in Baylin’s satellite communications division. He said portions of the backlog will convert to revenue at different rates depending on the business line, with infrastructure products generally moving more quickly while custom antenna and satellite programs may extend into next year.

Kaelus Acquisition Expands Product and Geographic Reach

Baylin completed its acquisition of Kaelus at the end of May. Carroll said Kaelus adds complementary wireless infrastructure products, operations in Sweden, Finland, the United States, Australia, China and India, and direct relationships with equipment makers Ericsson and Nokia.

According to Carroll, the companies’ product portfolios have “zero overlap,” while creating potential cross-selling opportunities. Kaelus has limited sales in North America, where Baylin’s Galtronics infrastructure business sells to carriers and infrastructure providers including AT&T, Verizon, T-Mobile, Rogers, Bell, Telus, Crown Castle, SBA and others.

Carroll said Baylin acquired Kaelus at a 4.6-times multiple, with approximately 62.5% of the purchase price paid in cash and the remainder paid in shares. The founder of Kaelus elected to receive a portion of the consideration in Baylin shares, Carroll said.

Kaelus supplies cell-tower antenna technology, synchronization products, RF conditioning equipment, and test-and-measurement products. Carroll highlighted Kaelus’s patented beam-through antenna technology, which enables carriers to stack antennas on towers and potentially reduce tower-rental costs. He said there are three companies offering that type of technology: Amphenol through its CommScope acquisition, Huawei and Kaelus.

The company also produces synchronization products used in wireless networks. Carroll said Kaelus developed anti-jamming versions of those products following demand associated with the war in Ukraine. He said Nokia deployed the equipment for Ukrainian operator Kyivstar, and that the network remained operational during a Russian missile attack.

Infrastructure Business Posts Higher Margins

Carroll said Baylin’s wireless infrastructure division grew 40% during 2024, which he described as the lowest capital-expenditure environment for wireless infrastructure in six years. The division is now operating at gross margins above 60%, compared with gross margins in the low 20% range when he joined the company.

Baylin’s infrastructure offerings include its HyperFlat in-building antenna and multibeam technology for venues such as stadiums and concert facilities. Carroll said HyperFlat antennas are deployed at Hilton properties, MGM casinos and Disney locations.

He also cited deployments of Baylin’s multibeam antennas by Rogers at Toronto’s Rogers Centre and by Deutsche Telekom at a European music festival at the Hockenheimring. Carroll said Deutsche Telekom carried 40 terabytes of data during the event and subsequently publicized its use of Galtronics antennas. Vodafone later contacted Baylin and became a customer, he said.

While Carroll expects wireless infrastructure spending in North America to remain muted through the latter half of 2026, particularly at AT&T and Verizon, he said ongoing growth in data consumption and future artificial-intelligence applications involving edge computing should support a later return in wireless investment.

Satellite and Defense Opportunities

Baylin’s satellite communications business supplies high-power equipment used in satellite links. Carroll said the company’s technology supported communications between Earth and lunar modules for NASA’s Artemis mission, and that SpaceX has begun purchasing from Baylin.

He said satellite communications sales increased significantly in May and June, supported by defense-related demand. Carroll pointed to rising Western defense spending, including increased spending in Europe, as a favorable trend for the business.

Looking ahead, Carroll identified cross-selling Kaelus products into North America, expanding Kaelus’s customer base and improving its margins as key growth priorities. He also said Baylin sees satellite communications as a major opportunity, particularly for its newer modular product architecture and defense-focused pipeline.

Balance Sheet and Share Structure

The Kaelus transaction also included a restructuring of Baylin’s balance sheet. Carroll said the company retired its prior RBC debt and replaced it with a new term facility that has not been fully drawn. Net debt was approximately C$11 million, which he said was the lowest level during his tenure as CEO.

Convertible debentures have been converted, while preferred equity has been largely converted, Carroll said. He estimated Baylin’s fully diluted share count at approximately 245 million to 247 million shares.

Addressing the company’s share performance, Carroll said Baylin issued significant equity during its turnaround through private placements and a rights offering, increasing the share count. He said the board has considered a reverse stock split in the future, but would pursue one only “for the right reasons at the right time.”

About Baylin Technologies (TSE:BYL)

Baylin Technologies Inc is a diversified wireless technology management company. It focuses on the research, design, development, manufacturing, and sales of passive and active radio frequency and terrestrial microwave products and services.

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