Rakon [NZX: RAK], whose shares have shed more than three quarters of their value in the past three years, posted a wider first-half loss on impairments following the sale of its Rakon Crystal (Chengdu) unit and associated charges against its New Zealand operations.
The net loss was $45.7 million in the six months ended Sept. 30, from a loss of $4 million a year earlier, the Auckland-based company said in a statement. Sales fell 10 percent to $80.5 million.
The former tech darling had already flagged impairments from Chengdu, which missed earnings targets and was sold to repay debt. Bank debt has dropped to $17 million from $36.9 million as a result of the sales proceeds. The company reiterated its forecast for a full-year loss of $54 million.
“The net loss although substantial, is in line with previously announced plans to structurally align Rakon to those parts of the business where there are growth opportunities and stronger profit margins,” it said today.
Total impairments in the first half were $32.7 million, made up of $25.1 million from discontinued operations and $7.6 million from continuing operations.
The shares fell 4.6 percent to 21 cents. They were at $1.26 in November 2010.
By division, the New Zealand business posted an earnings before interest, tax, depreciation and amortisation loss of $4.5 million, from an EBITDA profit of about $2.8 million a year earlier. Sales fell to $41 million from $50.8 million.
The UK had earnings of $2.58 million, down from $3.87 million, as sales fell to $14.8 million from $16 million. France had a loss of $5.6 million, wider than the year-earlier loss of $1.8 million, while sales rose to $28 million from $26.6 million.
Its shares of earnings from the Centum Rakon venture in India rose to $2.4 million from $1.57 million.
(BusinessDesk)
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Rakon first-half loss widens to $45m on impairments after Chengdu sale
33762