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Wellington Drive Technologies on trading halt pending announcement

Friday 8th March 2013

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Wellington Drive Technologies, the unprofitable manufacturer of energy efficient motors, has requested a trading halt pending an announcement.

The irregularly traded shares fell 8.7 percent, or 1.5 cents, to 14 cents yesterday, valuing the Auckland-based company at $11.3 million. The stock has dropped 30 percent in the past 12 months.

The manufacturer has embarked on a turnaround plan which has seen it exit ventilation production in Singapore, now outsourced to Ziehl-Abegg, and cut its inventory, supply chain and operating costs. The company shrank its net loss to $6.3 million in calendar 2012 from $14.5 million a year earlier.

Last year Wellington Drive shareholders approved a $2.1 million placement to SuperLife Investments, a KiwiSaver and insurance provider owned by closely held Aventine Group. That amounts to about 16.6 percent of the enlarged group.

The company is seeking continued margin expansion and revenue growth this year, with revenue forecast at between $30 million and $33 million, and the gross margin target is a 4 percent-to-6 percent increase on 2012.

It is aiming for a full-year loss on an earnings before interest, tax, depreciation and amortisation basis of below $3 million, with positive ebitda for 2013.

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