Sharechat Logo

Ike GPS shares jump 33% on 2017 breakeven forecast

Wednesday 4th May 2016

Text too small?

IkeGPS shares soared 33 percent after the company said it expects to reach cash breakeven in 2017 on improved sales from its new cloud-based product.

The shares rose 22 cents to 88 cents, a price not seen since February 2015, after the laser measurement tool developer said it expects continuing sales growth across its portfolio of measurement products, increased margins on new products, operating and cost efficiencies, and product-to-market infrastructure. 

The Wellington-based company is also investigating a potential NASDAQ listing, subject to the board’s review and approval of the terms and benefits. It raised $900,000 in January from three institutional investors to fund expansion in the US market. The shares were floated at $1.10 in a 2014 initial public offer when the company raised $25 million of new capital as it shifted away from production development to sales and marketing. 

"That Nasdaq listing fits with the geographic location of their markets and maybe a different investor appetite, but really it's rebounding, it's still below that IPO price," said Peter McIntyre, investment adviser at Craigs Investment Partners. "There will be a number of investors thinking 'at long last' - most investors who've taken a holding in Ike would know that it's a high-growth stock, they'd be prepared for the ups and downs, but from a strategic planning point of view it looks rather positive."

IkeGPS is foregoing short-term profits to chase long-term international sales growth. IkeGPS said it had about $5.3 million in cash at the end of 2016, down from about $10 million as at Sept. 30, 2015. 

The company said its growth outlook for 2017 remains high, and it will build upon the momentum of multi-year revenue growth rates exceeding 100 percent each year. That's based on predicted sales growth of its cloud-based IKE 4 product, which it said is "well positioned to grow existing customers and capture larger market share, estimated to be an addressable opportunity of $700 million." IkeGPS expects to announce major new customers tied to Google Fiber deployment projects across the US, it said.

Last month, IkeGPS said its annual sales for 2016 were at the bottom end of its lowered guidance, with $2.2 million of orders received in the final month of its current financial year to be booked in the 2017 financial year.

IkeGPS will announce its annual result on May 20.

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report