Ann: Rectifier Technologies Pacific Contract Signed, page-15

Scale...Scale...Scale....The buzz word for a manufacturer.
RFT is a manufacturer after all , albeit in a buoyant & growing market.
40% gross profit margin doesn't leave much to pay for salaries & corporate overheads.
In the half year report , it is noticeable that:
# Gross profit margin declined to 40% from 42%.
# Revenues increased by 37% , but CGS increased by 70%....strange to see such a big jump in materials & consumables cost.....Perhaps an aberration?
# Employees salaries remained stable despite increased sales (a good sign of labour cost containment)
RFT needs to increase sales to say $15m to produce profit of $1 to 2m......It is currently trading at a very healthy premium for a manufacturer....Bodes well , but don't expect to "fly" in the short term.