Rakon 2011 Results

Rakon 2011 Results

Rakon Limited (NZX: RAK) has achieved a significant increase in revenue and earnings for FY11, with revenue up 31% on the prior year to $189 million and EBITDA up 318% to $25 million. The company has also reported a 257% increase of $13.9 million in net profit after tax to $8.5 million, compared to a loss of $5.4 million in the previous financial year.

Brent Robinson, Rakon Managing Director, attributed the increase to growth across all segments of Rakon's business.

"Rakon has capitalised on the massive growth in the use of smart wireless devices and data usage across telecommunications networks. With our leading and advanced product range Rakon has increased its market share, not only into the companies that design and manufacture consumer devices, but also into the manufacturers of telecommunications infrastructure." he said.

Mr Robinson said the results continued the improvement that began in the second half of the previous financial year, when the company began its rebound from the impacts of the global economic crisis.

"Rakon has continued to follow its strategy of establishing a globally competitive business with a broad range of technology leading products. During FY11 we have begun to see the benefits emerge and financial returns accrue and we expect this to continue."

"Our customers and independent analysts forecast that the growth in wireless data over the next 5 years will accelerate rapidly by a factor of 40 times. To manage this networks need to expand and we continue to invest substantially in product development to ensure our products provide breakthroughs in performance and value. The release of the world's smallest OCXO, the 'Mercury' during the current year is an example of this and we have many more products at various stages in the pipeline."

Rakon has expanded capacity at all of its facilities during FY11 to meet current and future demand and its new facility in Chengdu is on track for official opening in July of this year.

"We have trebled capacity for ultra stable TCXOs used in telecommunications applications by leveraging our equipment and process IP developed in NZ over many years. We have doubled capacity for OCXOs in India to meet market demand and are currently expanding this capacity again. Our Chengdu facility is also very close to beginning trial production. The finishing touches on the facility are in progress and equipment has been delivered and will very soon be installed and commissioned. We have a global, diversified and very competitive manufacturing platform"

Mr Robinson also commented that integration of the former Temex business acquired in August 2010 had progressed well.

"This business has met our expectations in the period since acquisition. We have been and continue to be focussed on ensuring customer needs are met while strengthening our design and manufacturing processes. We are very pleased with the platform it gives Rakon to further expand business into the space and defence market."

Commenting on the year ahead Mr Robinson said that he expected Rakon's overall business to continue growing during FY12.

"Our sales volumes for the first 6 weeks of the new year are well up on the same period in the prior year which gives us confidence that FY12 will build further on the successes of last year."

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