Wellington Drive Technologies achieves a first half profit

The result for months ended 30 June 2021 (H1-2021) is in line with the Company’s announcement on 26 July 2021.

• Revenue was $30.6m, a 49.2% increase.
• EBITDA (adjusted) improved by $2.0m.
• The net profit was $0.62m.
• Cash at bank at 30 June was $6.1m.

US$ invoicing, which is a better indicator of activity, was US$22.8m, an increase of 70.5% over H1-2020.

The Company achieved an EBITDA¹ surplus of $1.83m, compared to $1.14m last year, and a net profit of $0.62m, a $1.40m improvement on the same period last year. This result includes a $0.3m expense arising from a change in fair value of the contingent consideration payable for the acquisition of iPX and $0.4m for the agreed part repayment to staff of 2020 salary reductions. If these one-off charges are excluded, underlying EBITDA for H1-2021 was $2.5m, a $2.0m increase over the same period last year and the underling profit was $1.3m, a $2.7m increase.

Customer demand is buoyant. As reported previously, the Company is managing several operating constraints including a tight IT labour market, supply shortages of some electronic components, increased component costs, constraints on shipping, increased shipping costs and more recently, the closure of the production line in Vietnam due to a COVID-19 closure. It is pleasing to now advise that production in Vietnam has recommenced following a temporary Government imposed COVID-19 closure. It will take a few weeks for production to be back to normal levels. Notwithstanding these ongoing challenges, the Company is maintaining its full year 2021 guidance of US$ invoicing in the range of US$45m to US$50m and EBITDA1 earnings to be in the range of NZ$3.5m to NZ$4.5m before deduction of non-recurring charges.

CEO Greg Balla commented, “It is great to see the strong results, as our team is doing an excellent job managing the impact of COVID-19, while launching exciting new solutions to the global market. Connect™ Monitor, launched in March, and Connect™ Network, will be launched in November, allowing our customers to connect their existing refrigeration fleet to Wellington’s Cloud and leveraging the data and analytics to make better decisions on the utilisation and operational efficiency of the refrigeration units and their support services. This is significant for our customers as having the whole fleet connected, not just new units, increases the already significant impact of these solutions 10 fold.”

EBITDA¹ (i.e. Earnings before interest, taxation, 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 differences in amortisation and impairment policies.