Wellington Drive narrows first-half loss as Latin America, weak kiwi drive sales growth

Wednesday 26th August 2015

Wellington Drive Technologies, the unprofitable maker of energy efficient motors, narrowed its first-half loss as gains in the Latin America market and a weaker kiwi dollar bolstered sales.

The Auckland based company reported a net loss of $671,000, or 0.38 cents per share, in the six months ended June 30, compared to a loss of $1.99 million, or 1.58 cents, a year earlier, it said in a statement. Sales gained 28 percent to $13.5 million, while gross margins increased to 20.7 percent from 18.5 percent.

The company expects annual revenue to beat the $17.8 million reported in 2014, and annual earnings before interest, tax, depreciation and amortisation to be a loss of less than $1 million.

Wellington Drive posted an Ebitda loss of $223,000 in the half, compared to a loss of $1.16 million a year earlier, and said it was still "possible that Wellington could be close to Ebitda breakeven for the 2015 year, depending on customer demand, new product sales, and the exchange rate."

Sales in Latin America underpinned the improved result, with revenue up 47 percent to US$7.16 million, while Asia and Pacific sales rose 17 percent to US$1.14 million. Those offset a 39 percent slump in sales to Europe, Middle East and Africa to US$1.41 million, and a 39 percent drop in US and Canada revenue to US$392,000.

The company generated an operational cash inflow of $512,000 in the half, compared to an outflow of $1.8 million a year earlier, and had cash and equivalents of $3.4 million as at June 30.

The shares rose 3.3 percent to 6.2 cents, valuing it at $13.9 million.

BusinessDesk.co.nz

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