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

 

Cadmus Growing Cash Position Proves Model

Cadmus Announces Revenue Growth And Strong Cash Flow

Cadmus Growing Cash Position Proves Model.

Auckland, 27 February 2007 – Cadmus Technology (NZX: CTL) today announced a strong six months for the year ended 31 December 2006 with operating revenues up 9.3 percent and EBIT before non-recurring items rising 12 percent to $1.6 million from $1.4 million in December 2005. Keith Phillips, Chairman of Cadmus Technology says that cash flow from operating activities for the half year also showed a marked 53 percent increase to $3.9 million (December 2005 $2.5 million).

”This proves the strength of the Cadmus ‘direct to market’ and ‘merchant ownership’ strategies put in place as part of our core planning several years ago. The improved financial position as a result of our business model, demonstrates the benefits of Cadmus owning its own products and also having its own rental business – we are the only payment solutions company in New Zealand to ‘own’ this space, and it is clearly a significant competitive advantage over those that only have a distribution model with no IP in their business,” says Phillips.

Phillips says that following the six month result Cadmus is in a very strong financial position with its business model providing ongoing and renewable revenue streams, solid cash flows, and the ability to replicate this anywhere else in the world.“

Cadmus has in excess of $7 million in cash, plus approximately $7 million of free cash flow residing in its rental division which will be released over the next 24 – 30 months and that puts us in a great position moving forward to scale the business even further.

Cadmus, says Phillips, has also positioned itself to take advantage of the significant business opportunity being presented with the replacement or upgrade of approximately 50,000 terminals in the New Zealand market, potentially worth up to $100 million in total revenue.

In addition the Australia markets are also moving towards EMV compliance which will require approx 400,000 terminals to be upgraded and/or replaced.

Overall, Cadmus’s performance in the previous 6 months has resulted in a stronger balance sheet, a company that has significant new opportunities opening in its core markets, an ongoing focus on the amalgamation of its distribution channels and significant free cash flow from its rental model.

Further, the company has undertaken additional investment in R & D, and undertaken specialist developments for large customers such as Bank of New Zealand and Lotteries.

In terms of capital raising, Cadmus has completed, prior to Xmas, a placement of 31million shares and has issued a prospectus for the Series 3 First Secured notes to replace the Series one and Series two interest bearing notes offerings.

The overall impact is a company with considerable cash resources, little debt and more free cash coming on stream over the next 12 – 30 months.

Further prospects and sales opportunities continue to be developed with a Heads of Agreement with leading forecourt petrol pump company Postec Data Systems that is potentially worth several million dollars, and will see several thousand of its UP05 EMV compliant EFTPOS units being supplied for the rapidly expanding Indian retail petrol market.

In the New Zealand market, there is an immediate need to replace and/or upgrade approximate 50,000 terminals, and the Australian markets are starting to come on stream.

Overall the business is in a good position to capitalize on these opportunities over the next 12 – 24 months.

In addition to this is the potential to complete a successful transaction with Intellect Holdings (IHG) which will add considerable market penetration into lucrative European markets that Cadmus has not yet entered. The effect would be to rapidly increase volume and scale. Due to the extensive nature of the IHG sales channels and business, both IHG and Cadmus are continuing to undertake further due diligence before advising the outcome of their latest discussions.

ENDS


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Tiwai Point: Rio Tinto Announces Plans To Close Tiwai Point Smelter

Rio Tinto has just announced that it will wind down New Zealand Aluminium Smelters - the Tiwai Point smelter - saying the business is no longer viable. More>>

ALSO:

Freight: New Report On Auckland Port Relocation

The Government has released a major new report on the options for relocating the Port of Auckland’s freight operations while deferring any decision on the issue. More>>

ALSO:

Chartered Accountants: COVID-19 Fails To Knock Kiwi Investor Confidence, But More Disclosure Wanted

Three months of COVID-19 lockdown and investment turmoil has done little to knock confidence in New Zealand capital markets and listed companies with overall investor sentiment very similar to 2019, an investor survey held in mid June shows. However, ... More>>

ALSO:

Taxation: Black-Market Tobacco Sidesteps $287 Million In Excise Tax

Year-on-year increases in consumption of illicit tobacco in New Zealand have seen illegal trade swell to 11.5% of the total market. If consumed legally, illicit products would have netted the Government $287 million in excise tax during 2019. Independent ... More>>

ALSO:

Energy Sector: Meridian Spilled Water To Hike Electricity Prices - Authority Ruling

The Electricity Authority has found that generator Meridian Energy manipulated the power market, costing consumers about $80 million. More>>

ALSO:

XE Data Update: RBNZ Official Cash Rate Decision

The RBNZ will keep the Official Cash Rate (OCR) at 0.25%. T he key points in the RBNZ statement are: RBNZ keeps the OCR unchanged at 0.25% Maintain the LSAP (large scale asset purchase) at NZD$60 billion. Committee prepared to use additional monetary ... More>>

ALSO:

Electricity: Kiwis Ignore Promise Of Cheaper Power

Electric Kiwi and Flick Electric Co are joint winners of Canstar Blue’s award for Most Satisfied Customers | Electricity Providers From putting on an extra layer – rather than turning on a heater – to turning off lights and choosing the energy-saving ... More>>

ALSO:

Electricity: Transmission Pricing For A Low Carbon Future

The Electricity Authority has decided on new guidelines for transmission pricing. James Stevenson-Wallace, Chief Executive of the Electricity Authority says the new guidelines will deliver significant benefits to consumers, through lower electricity ... More>>

ALSO:

RNZ: Economic Activity And Business Confidence Bouncing Back

Two surveys from ANZ show business confidence and economic activity have rebounded, but uncertainty about the future remains extreme. More>>

ALSO:

NIWA: The Climate Record That Keeps Getting Broken

Among the multitude of New Zealand climate statistics there is one record that continues to be broken month after month. Since January 2017 there has not been one month that recorded a below average nationwide temperature, according to NIWA’s seven station ... More>>

ALSO:

Govt: Extended Loan Scheme Keeps Business Afloat

Small businesses are getting greater certainty about access to finance with an extension to the interest-free cashflow loan scheme to the end of the year. The Small Business Cashflow Loan Scheme has already been extended once, to 24 July. Revenue and Small ... More>>

ALSO:

Science: 2019 Prime Minister’s Science Prizes Announced

The 2019 Prime Minister’s Science Prizes have been announced in a digital livestream event today. The Prizes recognise the impact of science on New Zealanders’ lives, celebrate the achievements of current scientists and encourage scientists of the ... More>>

ALSO:


RNZ: Fuel, Alcohol Costs To Go Up From Today

The increase today in the taxes on fuel, road user charges and alcohol is being called a tone-deaf move. More>>

ALSO:

Stardome Observatory: Young Kiwi Astro-Photographer Shoots For The Stars

Matariki by Josh Kirkley. The stars are aligning for up-and-coming Auckland-based astro-photographer Josh Kirkley (Kāi Tahu). During lockdown, one of his images was picked up by NASA and shared on the space agency’s Instagram to its 59.2 million ... More>>


DCANZ: Time For EU To Commit To A Level Playing Field For Trade

The Dairy Companies Association of New Zealand (DCANZ) has welcomed New Zealand Trade Minister David Parker’s statement that it is unacceptable for New Zealand exporters to continue facing an ‘unlevel playing field’ in the EU. Details leaked ... More>>

ALSO:

New Zealand Government: Supporting Kiwi Businesses To Resolve Rent Disputes

The Government will legislate to ensure businesses that suffered as a result of the COVID-19 response will get help to resolve disputes over commercial rent issues, Justice Minister Andrew Little announced today. More>>

ALSO: