Investors turn tail on float

By Chris Hutching

Friday 27th September 2002

Fewer investors were prepared to take the plunge into the Connexionz share float, which raised $1.5 million of the $4.5 million sought.

Connexionz executive director Tony Kan described the result as "satisfactory given volatile markets and local sentiment towards company flotations."

Mr Kan said interest in the prospectus was high with 3950 requests for a hard copy of the prospectus and 7070 downloads from the website. But the final harvest was just 310 investors with enough faith to back the Christchurch electronics engineering company.

The company will go ahead with its plans to use the money for working capital to market its realtime GPS-based bus information system to private and public transport operators in various cities.

"While the total subscriptions are in the middle range of what we aimed for, they will still provide sufficient capital for Connexionz's prospectus forecasts," according to Mr Tan.

The $1 shares would be tradeable after Wednesday 24 September through the unlisted securities facility that is used by sharebroking members of Stock Exchange.

The Connexionz prospectus forecasts accelerating earnings from $1.3 million this year to $5.5 million in 2003, $17.3 million in 2004 when it also predicts its first profit after tax at $3.3 million, rising to $30 million of revenue in 2005 providing $8.2 million in profits.

Each of Christchurch city's 215 buses carries a GPS unit, made by Auckland-based NavMan, which is connected to an onboard computer using a Tait Electronics mobile radio to report the bus's position every 30 seconds.

The information shows up on a screen at the central bus exchange and a further stage of the trial involves installing touch screens at bus stops so passengers can see how far away their bus is.

Connexionz has also won other contracts locally and in Australia.

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