Rakon upbeat on stronger second half

Crystal manufacturer Rakon has announced a full-year loss of $5.4 million on revenue of $144.5 million but an improved second half has the company in good shape as it expands in China, it says.

Rakon reported earnings before interest, tax, depreciation and amortisation (ebitda) of $7.2 million and a net profit after tax of $800,000 for the second half of the year, to the end of March - a "significant improvement" on the first-half net loss after tax of $6.2 million.

"As we expected our results in the second half of the year were much stronger as demand grew strongly across our entire business which helped deliver a $7 million improvement in net result after tax," said managing director Brent Robinson.

"Rakon now has a global business with an excellent portfolio of products for consumer and telecommunications applications. I am very pleased with the progress we have made over the past three years."

Despite the global financial collapse Rakon had "enhanced the capability its global platform" and broadened its product range significantly, he said.

It increased its share of the smartphone market and significant investment in new equipment was being made by companies to deal with the huge increases in data traffic being generated by mobile devices such as the iPhone and Blackberry, he said.

Rakon's strategy of expanding firstly into Europe and then into India and China, plus investment in new technologies, put the company in a strong position to build strong bottom-line growth now and in the future, Robinson said.

Rakon had secured land and finalised plans to begin construction of its new crystal manufacturing facility in Chengdu, China, and aimed to begin commercial operations in July next year.

Rakon's existing joint venture in China had also performed better than expected with strong growth and profitability, he said.

Rakon closed the year with cash reserves of $46 million, held to fund planned expansion particularly in China over the next 18 months.

Shares in Rakon closed down 3c at 97c yesterday.

- NZPA

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on production bpcf05 at 01 Nov 2014 20:00:42 Processing Time: 275ms