Rakon says its annual operating profit could fall as much as 44 per cent for the year ending March 2012.
Photo / supplied
Crystal timing devices manufacturer Rakon's shares sank 5.8 per cent after it said annual operating profit could fall as much as 44 per cent for the year ending March 2012 if the New Zealand dollar remains are current levels.
"Our underlying global business is performing well" and continuing to record
strong sales growth, managing director Brent Robinson told NZX.
But the strength of the New Zealand dollar against the US dollar and the British pound is significantly impacting profitability. The shares dropped 5.8 per cent to 81 cents and have tumbled 30 per cent this year.
"In the past 18 months the New Zealand dollar has strengthened more than 20 per cent against the British pound and over 25 per cent against the US dollar," Robinson said.
"To put this impact into context, this equates to a reduction in cash earnings in the current year of around $20 million, purely from the impact of currency," he said.
