WDT
19/02/2016 15:22
FORECAST
PRICE SENSITIVE
REL: 1522 HRS Wellington Drive Technologies Limited
FORECAST: WDT: Wellington Drive Technologies market update
Wellington Drive Technologies (NZX:WDT), a leading provider of energy
efficient motors and 'cloud connected' controllers to the commercial
refrigeration market, is pleased to provide an update on its new product
sales and highlights of its unaudited 2015 financial results. This is in
advance of fully audited results being released by February 29th.
Wellington receives first production orders for its new SCSConnect and ECR2
products.
SCSConnect 'cloud connected' refrigeration controller - In November 2015 we
advised that contractual discussions were advanced with a number of global
branded consumer products customers for the supply of SCSConnect controllers.
We have received a first sizable purchase order from one customer for
hardware and data services for delivery in first quarter 2016. This order is
expected to be the first in an ongoing deployment program with this customer
over the remainder of 2016 and for the following several years. It is
expected that we will continue to receive production orders and be shipping
products while contracts are taken to completion.
The team continues to support field trials in the USA, Mexico, South East
Asia, South America, Africa and Europe as customers develop new IT and
operating systems to integrate the business data provided by the SCSConnect.
Production orders from customers and continued field trials highlight the
positive prospects for SCSConnect and we have started to extend the current
platform into an expanded range of applications and value added services.
Forecast 2016 revenues for SCSConnect remain consistent with previous
guidance of between US$1m and US$1.6m.
ECR2 energy efficient motor - We have commenced production shipments of the
new ECR2 motor to a large US cooler manufacturer which is using the product
in a broad range of food and beverage supermarket display cases; the target
market for this new motor. We have also received initial orders from other
North American supermarket case manufacturers and several European customers
as they increase their pilot production needs.
Wellington's EC motor business saw a strong recovery in the 2015 financial
year with volume growth of 28% versus 2014. Continued double-digit volume
growth is expected in 2016, supported by increasing sales of our new ECR2
motor and the winning of new customers for our other ECR products. We are
seeing adoption of EC motors accelerate, particularly in the USA in response
to stricter US Department of Energy regulations.
CEO, Greg Allen commented; "We continue to deliver great products and
services to our customers and with these new products now in the market we
expect an acceleration of our path to profitable growth. With order intake
on SCSConnect and ECR2 during December and January of around 20,000 units and
advanced contractual discussions underway, 2016 is off to a strong start."
Significant growth in 2015 revenues
The company delivered full year unaudited 2015 revenues of $24.6 million, a
38% growth in year over year revenue. This result was in part due to a
significant rebound in Latin American sales and growth in the Asia Pacific
region. Global motor volumes increased by 23% to over 1 million motors
shipped in 2015.
Gross margin improved to 21.4%, up from 18% in 2014, as a result of continued
improvement in manufacturing efficiencies and supplier costs. Gains were
offset somewhat by pricing strategies deployed to secure new business. (see
note 1 below).
Losses continued to decline with EBITDA performance a loss of $1.4 million
versus the $4 million loss in 2014 (see note 2 below). Earnings before
Interest and Taxation (EBIT) performance was a loss of $1.8 million, a $2.7
million improvement on the $4.5 million loss in 2014.). The result was
positively impacted by the lower NZ Dollar versus the US Dollar. Average
NZD/USD rate for the 2015 year was 0.707 compared to 0.830 for 2014.
Operating cash flows were a positive inflow of $0.8m and the cash balance at
31 December was $2.9m.
Wellington Chairman, Tony Nowell commented; "Every financial indicator
improved as expected during 2015 and we were particularly pleased to see the
top line growing again and positive operating cash flow. The 2015
performance is very heartening and shows we are on the right path. The team
is focusing now on selling our new products and we look forward to further
growth in 2016".
Note 1 - Gross margin is the gross profit percentage calculated from GAAP
measures of revenue and gross profit
Note 2 - EBITDA (ie Earnings before interest, tax, depreciation, amortisation
and impairment) is a non-GAAP earnings figure that equity analysts tend to
focus on for comparable company performance analysis. Wellington considers
that it is a useful financial indicator because it avoids the distortions
caused by the differences in amortisation and impairment policies. EBITDA is
calculated as the loss before interest and taxation of $1,802,000 for 2015
(2014 $4,509,000) less depreciation, amortisation and impairment of $399,000
for 2015 (2014 $502,000).
For further information visit www.wdtl.com.
Contact:
Greg Allen
Chief Executive Officer
Phone +1-778-238-6494
Howard Milliner
Chief Financial Officer
+64 27-587-0455
+64-9-477-4500 ext 228
End CA:00278000 For:WDT Type:FORECAST Time:2016-02-19 15:22:02
