Rakon returned to profit on technology demand

Thursday 11th November 2010

Rakon returned to profit as demand for new technology reemerged after waning through the global downturn of the past couple of years.

The Auckland-based company reported a profit of $5.6 million in the six months ended September 30, compared to a loss of $6.2 million a year ago. Revenue grew 31% to $94.6 million, with growth across all of Rakon’s business segments as it boosted its market share in telecommunications and had strong demand for network infrastructure customers, according to managing director Brent Robinson.

“New emerging technologies which we supply, such as femtocells, have also begun to ramp up in volume, which helps provide a sound base for long term growth,” Robinson said in a statement. Rakon has established strong positions with leading smart-phone manufacturers, and it shipped over 10 million units in the first half of the financial year.

The company’s strategy has been to establish a globally competitive business with a broad range of technology leading products, and “although there is a lot more work to be done, we are now beginning to see the financial returns for the effort we have put in over the last couple of years,” Robinson said.

“Over the past six months we have continued to invest heavily in product development, recently launching the world’s smallest OCXO, the ‘Mercury’, and have many more products in the pipeline,” he said.

Rakon acquired French rival Temex for 400,000 euros at a significant discount to book value.

Robinson said Rakon is well-positioned in all of its markets and is comfortable with the current range of brokers’ EBITDA estimates for its 2011 year of between $25 million to $30 million.

The shares were unchanged at $1.28 in trading today, and have climbed 10% this year.

Businesswire.co.nz

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