Rakon shares drop 4.6% as 2014 loss widens to $79.9m on asset writedowns, depreciation
Shares in Rakon [NZX: RAK] dropped 4.6 percent, making the stock the second-worst performer on the NZX All Ordinaries Index, after the maker of crystal oscillators used in smart phones and navigation systems said it lost more than it expected last year as its assets fell in value.
The Auckland-based company said it had a loss of $79.9 million in the year ended March 31, wider than its forecast loss of between $55 million to $59 million, and its $32.8 million loss the year earlier. The latest figures are unaudited and the company said its full earnings will be released May 22.
Rakon expects to write down the goodwill of its UK factory by $15 million as part of a plan to shift manufacturing to New Zealand in the current financial year. In addition, other property, plant and equipment was assessed as having a reduced useful life, bringing forward depreciation of $7.4 million and the company has also finalised the impairment following the sale of most of its stake in its Chinese factory to repay debt.
Shares in Rakon dropped 1 cent to 21 cents, taking their slide over the past year to 8.7 percent.
The company said its expectation for a 2014 loss in 'underlying' earnings before interest, tax, depreciation and amortisation remains unchanged of $5 million to $8 million.
Meantime, it met its target of reducing bank borrowings below $12 million at March 31, Rakon said.