IkeGPS confirms weaker Spike sales, improved total IKE sales in 2018
By Jonathan Underhill
April 10 (BusinessDesk) - IkeGPS, the unprofitable laser measurement toolmaker, has confirmed weaker-than-forecast of its Spike product in 2018 and an increase in sales of its IKE product for measuring polls and other aerial plants.
The company sold about 2,200 Spike units in the year ended March 31, below its target of 3,000 units. It first flagged that sales had undershot guidance with the release of its third-quarter update in January. IKE sales amounted to 476 systems, up 2.3 times from a year earlier, the Wellington-based company said in a statement. It didn't detail revenue or earnings for the year ended March 31.
In November, IkeGPS affirmed its target to reach breakeven on an operating cash-flow basis in full-year 2018. It didn't affirm that target today. It held cash of about $2.6 million at March 31 compared with $2.7 million cash at the end of March 2017. During the first half of the 2018 year, it raised about $4 million in a placement and share purchase plan.
"We are in the year-end audit process and as such will detail operating cash-flow performance for 2H and Q4 when that concludes / at the same time as the audited financials are released," chief executive Glenn Milnes told BusinessDesk. "What today’s announcement does show is an approximate 6x improvement in total cash usage over PCP as relates to the 2H period."
IkeGPS shares jumped 11 percent to 50 cents, the highest level since November 2016. The company went public in 2014 after selling shares at $1.10 apiece that raised $25 million. At the time of its IPO it projected two years of widening losses as it burned cash to increase sales.
Researcher Lodge Partners said in a Feb. 6 report that it expected IkeGPS to turn to a profit in 2020 at about $5.1 million, from the loss of $5.97 million it forecast for 2018. Revenue in 2020 was estimated to be $18.8 million from a forecast $8.6 million in the March 2018 year. Lodge predicted the company would reach positive operating cash flow of $704,000 in 2019, compared to a cash outflow of $2.99 million for the year ended March 31, 2018.
The company expects to release its full-year results in late May when it plans to provide guidance for 2019, "where we expect to see continued revenue and margin growth," Milnes said.