Rakon plunges into red on high dollar
The high dollar has wiped out all the half-year profits of listed technology company Rakon.
Although earnings in the US were up 14% for the six months to September 30, the gains were eroded by the strong Kiwi, which averaged 81c during the period – 10c higher than in the same time last year.
Rakon made a net loss of $259,000 for the six months to September 30, down 105% on the $5,323,000 profit for the same period last year
Revenue of $94.6 million, unchanged from the same time last year, was in line with expectations, the company said.
Shares in Rakon fell 5c or almost 7.5% to 62c this morning.
Rakon’s crystal oscillators are used for smart wireless devices such as smart phones, GPS and tablet PCs and for applications used by space and defence industries.
Managing director Brent Robinson said the prolonged strength of the New Zealand dollar was a problem for all New Zealand exporters and manufacturers.
Although the economic environment, he reaffirmed previous full-year earnings guidance of EBITDA in $14 million to $18 million range.
Rakon had recently reduced indirect costs in a number of areas, in response to below-forecast demand from telecommunications customers, in particular.
Rakon is paying no interim dividend.