Moa Group widened its first-half loss as the boutique beer maker accelerated spending to expand its beachhead in China, which it now sees as its most promising export market.
The Auckland-based company reported a loss of $1.5 million, or 2.7 cents per share, in the six months ended Sept. 30, compared to a loss of $1.3 million, or 2.6 cents, a year earlier. Sales rose 29 percent to $4.5 million, with gross margin widening to 28.8 percent from 27.2 percent, while Moa's sales and marketing expense jumped 42 percent to $1.4 million.
"Whilst we have been in China for some time now we see this market as our most promising export market," chief executive Geoff Ross said in a statement. "Working with new local partners and with our own person in market, we have some very good opportunities."
Moa told the market in September the first-half earnings would be hit by the Chinese investment, but expected positive cash flow through the summer months and a significantly improved annual result.
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Today, the brewer said it is aiming to deliver annual earnings before interest, tax, depreciation and amortisation which "demonstrate continued growth and improvements in all the key measures of the business." Moa's first-half ebitda-loss widened to $1.3 million from $1.1 million.
Moa's operations delivered a cash outflow of $1.5 million in the half, compared to an outflow of $621,000 a year earlier, and it held $1.5 million in cash and equivalents as at Sept. 30. The brewer raised $329,000 in a private placement from a US investor in August.
The brewer also said it went through a "heavy period" of developing new products in the half.
The company's distribution deal with ParrotDog Brewery ended on Nov. 26, with the Wellington craft beermaker currently seeking $1.4 million of new capital through an equity crowdfunding offer to develop its internal sales capability having taken distribution in-house.
Moa shares last traded at 41.5 cents, having plunged 45 percent this year, making it the 11th worst performer on the S&P/NZX All Index.