Doubling output high on agenda

Dunedin-based gas-fire manufacturer Escea is on target to achieve its forecast $4.5 million in turnover for its second year of operations.

Going against the trend of a tightening manufacturing market, Escea has tripled its staff, doubled its turnover and is eyeing Australian exports to potentially double its output to 2400 units in its next financial year.

Managing director Nigel Bamford said Escea's target, to supply the niche, high-end gas-fire market, gave it an edge in the manufacturing sector.

"People have become more highly aware of energy efficiency. They are moving away from open fires and open gas fires. Closed gas fires have three times the heat efficiency," he said.

And although Otago is seeing quite a few lay-offs in manufacturing staff, Bamford said Escea staffing had increased from eight to 23 during the past 17 months. Design staff had doubled to four and North and South Island sales managers positions had been created.

Opened in March 2005, Escea had spent three years in research and development mode, including design contracting for other manufacturers to keep up cashflow.

Escea makes 7.5kW and 9kW units, in black or silver, which retail for $3595 and $3995 respectively. A new outdoor 1200mm unit, selling for $5000, will be launched in two weeks.

The outdoor fire is designed for markets such as Queenstown, where outdoor living on decks is a feature and having open fires in residential areas is often impractical or illegal.

All fires operate on natural gas or LPG and have a standard flue fitting.

Bamford said Escea had taken its "world first" of operating the gas fires remotely by mobile phone a step further to operation via the internet.

"The last thing you could do at work on a cold day is go on-line, dial up the gas fire and set it before you leave," he said.

Escea's three shareholders are Bamford, a mechanical engineer, tradesman tool-maker Alan McGregor and accountant Garth Milmine.

Bamford said all expansion was being achieved by increasing sales, and while ruling out an initial public offering and float on the New Zealand stock exchange to raise expansion capital, the directors might consider inviting the participation of other private investors.

Escea was in negotiation with several distribution outlets in Australia and hoped its target of 1200 units this financial year could be doubled to 2400 next year.

"We aren't going to look at exporting to seven countries a year but tend to look at one [new] country in a year," he said.

Escea's 1000sq m Devon St premises has a history in appliance manufacturing, having been the site for Atlas and Champion Appliances until about 1987.

- OTAGO DAILY TIMES