Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


WDT widens 1H loss, warns FY earnings won't improve

Wellington Drive widens 1H loss, warns FY earnings won't improve

By Tina Morrison

Aug. 29 (BusinessDesk) - Wellington Drive Technologies, the unprofitable manufacturer of energy efficient motors, widened its first half loss and said full year earnings won't improve as sales slump in Latin America, its largest market.

The company posted a loss of $1.99 million, or 1.58 cents per share, in the six months to June 30, from a loss of $1.22 million, or 1.87 cents, in the year earlier period, the Auckland-based company said in a statement. Revenue fell 35 percent to $10.6 million.

Wellington Drive said first half sales in the Americas, its largest market, slumped 45 percent to $6.6 million as weak demand in Latin America prompted increased rivalry and pushed down prices. The weak demand in the region is expected to continue through the rest of 2014, it said today.

"We experienced strong competitive pressure in the Latin American region, as competitors fight for a smaller available market by adopting aggressive pricing and commercial offers to take share and win new projects. This has result in the company losing some share with two customers in that region," the company said. "We are adjusting guidance to now expect 2014 revenues to be lower than 2013 with the loss before interest and tax remaining at similar levels."

The latest forecast is a further downgrade from the company's expectations in June when it said it expected revenue to be in line with 2013's $27.4 million level, compared with its previous forecast for 2014 annual revenue of $30 million to $35 million. In June, the company was forecasting its annual loss and Ebitda to improve from 2013.

Wellington Drive said it is cutting costs, diversifying its customer base and developing new products to counter the downturn in revenue and is confident it will significantly improve its 2015 results.

"Current forecasts indicate that cash resources are adequate to fund the business in the medium term," it said. The company's 2013 annual accounts were tagged by auditor PwC over forecast cash flows. Wellington Drive had cash and cash equivalents of $4.85 million at June 30.

Shares in the company last traded at 11 cents and have declined 54 percent so far this year, the second-worst performer on the NZX All Index.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Tech Sector Report: Joyce Warns Asian Tech Investors View NZ As Hobbits And Food

Speaking in Wellington at the launch of a report showcasing the value of the technology sector to the New Zealand economy, Joyce said more had to be done to tell the country's technology stories overseas. More>>

ALSO:

Mediaglommeration: APN Gets OIO Approval For Demerger Plan

APN News & Media has received Overseas Investment Office approval for its plan to split out its NZME unit ahead of a potential merger with rival Fairfax Media's New Zealand operations. More>>

New Paper: Ninety-Day Trial Period Has No Impact On Firms' Hiring

The introduction of a 90-day trial period has had no impact on hiring by New Zealand companies although they are now in widespread use, according to researchers at Motu Economic and Public Policy Research. More>>

ALSO:

Corrections: Serco Exits Equity Stake, Remains As Operator

Serco has sold its equity stake in the company that holds the contract to design, build and run Wiri Prison in South Auckland but continues as sub-contractor to operate the facility. More>>

GDP: NZ Economy Grows Faster-Than-Forecast 0.7%

New Zealand's economy grew at a faster pace than expected in the first quarter of 2016 as construction expanded at the quickest rate in two years. The kiwi dollar jumped after the data was released. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news