is this cmp's turnaround year ??
CMP is a company that has disappointed the market after spending a large amount of revenue on R&D last year ,but reading the recent report to the ASX they seem to be saying they may be back on track this year ,
Who knows ????but I like the story so I picked up a few more
Melbourne Australia, Thursday, January 12, 2006 ASX / MEDIA RELEASE copy from pdf
Medical diagnostics company Compumedics Ltd (ASX: CMP) previously indicated at the AGM that sales in the first quarter of the year had been unexpectedly slow. Slow sales continued in the US clinical and research businesses in the second quarter but this was partially compensated for through stronger performances in other business units during that period, some of which were much stronger than in the prior period.
Overall, the first half sales will be approximately $18 million (with about $1.2 million orders on hand) as against $19.3 million sales recorded in the prior year with $ 0.7m orders on hand. The company considers this result to be credible given the slump in market conditions for key units in the US due to the adverse impact of the weakened US economy and the restructuring undertaken through the course of the 2005 calendar year.
The USA clinical business has experienced improved performance over the recent periods and the product sales pipelines are at strong levels. Management is focused on converting this pipeline into sales for the second half year and success in this will drive results for the full year. However, given the uncertainties of the USA market, the company does not propose to give guidance as to the likely outcome for the year, although it still considers the previous 2006 sales guidance of $38 million and a return to positive EBITDA earnings in the second half of the financial year to be achievable.
The company also indicated at the AGM that costs of approximately $2 million on an annualised basis were to be taken out of the business.
Another $1 million of cost savings on an annualised basis have since been identified, particularly in the US. ,
These savings will be reflected during the forthcoming six months.
The company also indicated previously that it was in a contractual dispute with its former distributor for sleep products in Europe. The company advises that settlement has been reached yesterday with the former distributor, which will result in a USD1.51m (approximately AUD2.0m) benefit to the company, of which USD1.45m will be received in cash. This income will be booked by the company in its accounts in early 2006. The company also indicated at the AGM that it was in discussions with its bank regarding continued financial support during the ongoing business turnaround. The bank continues to express ongoing support for the company during this performance turnaround phase. Despite a number of challenges confronting the business, the results indicate that the company is now making headway with its most recent US restructure activities; Europe is once again demonstrating growth and the Australia-New Zealand and Asia regions are performing well. Compumedics Limited (ASX:CMP) Released on 12 January, 2006Page 2 of 2 The recent investment in the significant strengthening of Compumedics’ sales and marketing resources across USA, Europe and Asia coupled with cost reduction, the company believes, is the right strategy, evidenced by the re-emergence of sales growth in our key global markets. The company’s view of its performance will remain cautious and its focus continues to intensify on profitability as well as stronger and more sustainable growth. The company is appreciative of investor focus upon the longer term potential performance of Compumedics and will continue to endeavour to hasten earnings improvement when and where possible. Yours sincerely, David Burton CEO, Chairman Compumedics Limited For further information: David Burton Executive Chairman, CEO Phone: +61 3 8420 7300 Fax: +61 3 8420 7399 David Lawson Company Secretary /CFO Phone: +0011 1 915 225 0319 Fax: +0011 1 915 845 2965
CMP Price at posting:
0.0¢ Sentiment: Hold Disclosure: Held
(20min delay)