Sharechat Logo

Energy Mad shares drop as further losses unveiled

Tuesday 26th November 2013

Text too small?

Energy efficient lightbulb retailer Energy Mad has turned in another loss and has decided to write off a $2 million tax benefit, which would become available again if it were to be profitable and as long as at least 50 percent of the company remains in the same hands in the meantime.

On a normal operations basis, the company lost $500,000 in the six months to Sept. 30, the same as for the same period last year, but reported a net loss of $2.5 million for the period once the tax benefit writedown is included.

Directors warned shareholders the tax benefits could not be revived unless a 49 percent minimum continuity of shareholding was kept "between the beginning of the period in which the associated tax losses were earned and the end of the period in which they are offset."

A total of $7.7 million of accumulated tax losses have 50 percent continuity of shareholding, although gross tax losses of around $3 million would still be available if continuity of ownership were lost, the company said in a statement.

Energy Mad shares dropped 4 cents to 25 cents when trading opened on the NZX this morning. The company listed in a barely supported $5 million float in October 2011, listing at $1 a share. It has consistently missed prospectus forecasts and suffered NZX censure last month over late profit warning disclosures in January last year.

Operating revenues for the period were $4 million, compared with $4.5 million in the same period a year earlier, with New Zealand sales improving while sales in the US collapsed from $1.6 million in the prior period to $100,000.

"The nature of Energy Mad's business means that there is considerable uncertainty around the timing and size of orders from major customers."

To take greater control of its own destiny, Energy Mad was now putting greater effort into its New Zealand-based installation business, which does not require the involvement of third party partners.

Much of Energy Mad's experience and potential has been said to lie in its ability to partner with electric utility companies to offer heavily discounted high-cost energy efficient lightbulbs. However, efforts in the US and Australia have been dogged by poor sales and, in Australia, product registration difficulties, although these are now resolved.

"The main driver of Energy Mad's growth in the short term will come from an accelerated scale-up of the Direct Installation business in New Zealand," the company said.

It gave no earnings guidance for the full year with today's half year accounts.

New Zealand sales for the half year totalled $1.45 million, while Australian sales were $2.0 million.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
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:

Govt eyes 2025 for farm-level emissions pricing, tests interim steps
Govt won't "die in a ditch" for 100% renewable target
NZ 2Q CPI +0.6% on quarter, +1.7% on year
16th July 2019 Morning Report
Suspect company faces liquidation after director dies
NZ dollar holds gains; focus on domestic inflation data
MARKET CLOSE: NZ shares slip as fears over slowing Chinese growth weigh; AMP slumps
NZ dollar rises after heartening Chinese data
Suspect company faces liquidation after director dies
Foreign investors face maximum penalty for breach after $13M purchase

IRG See IRG research reports