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Wellington Drive limps on, fails to get into the black - again

Thursday 30th August 2018

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Wellington Drive Technology continued its as-yet-fruitless journey towards profitability.

The company, which started life as a market-darling developer of energy-efficient motors, and has since expanded into areas as diverse as the internet of things (IoT) and retail food and beverage, reported a net loss of $200,000 for the half-year ended June 30. That compares to a $500,000 loss for the same period last year.

The company’s shares traded above $10 at various times in the early and mid 2000s, but began a slow, painful decline in 2007 and since 2013 have never gone above 30 cents a share.

Funding has been a perennial problem for the company, with the level of debt compared to net worth doubling to over 35 percent from five years ago.

However, the immediate future is secure, says chief executive Greg Allen, with the company “in the process of documenting” a new $2.5 million loan, repayable in September 2019.

Allen said existing lender Meta Capital has also offered to extend the repayment date of its loan into 2019.

“With these new facilities in place the company is well positioned to repay existing debt due March 2019, manage changes in customer payment terms and locally-held customer inventory, and to commence investment in new IoT projects.”

WDT bought Australian-based digital marketing company iProximity in July. Allen said “several field trials are underway using iProximity’s solutions, including working with large global food brands to deliver... information to retailers and shoppers.”

Revenue at WDT grew 18 percent on last year to $28 million, with growth in America particularly strong, Allen said. In the second quarter of 2018, motors were 64 percent of the company’s total US revenue, while IoT solutions were 32 percent.

The stock last traded at 18.1 cents, having gained 13 percent so far this year.


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