PERTH, Australia, Feb. 24 /PRNewswire-FirstCall/ -- Orbital Corporation Limited today reports results for the half year ended 31 December 2008.
Key Features of the Half Year
'The 1st half has been impacted by the global economic crisis unfolding during the period,' commented Managing Director and CEO, Terry Stinson. 'Our key markets in North America have been particularly hard hit as has been the case for most companies operating internationally.'
- Net loss after tax of $2,594,000 which was in line with previous guidance, compared to a loss of $389,000 for the same period last year.
- Engineering revenue and royalty income were each lower than the same period last year as a result of the tough global economic conditions.
- Orbital Gas Products delivered a profit in the 1st reporting period since acquisition.
- Synerject increased sales by 9% compared to prior corresponding period.
- Orbital FlexDI(TM) chosen by Sygma as most promising technology for heavy duty ethanol engines in Brazil.
'On a positive note Synerject generated sales growth in a tough market with the roll out of new product manufactured in the recently commissioned facility in China,' added Terry Stinson.
FINANCIAL OVERVIEW
Dec 2008 Dec 2007
$'000 $'000
Engineering Revenue 4,053 6,632
Contribution 672 1,840
OGP Revenue 3,623 -
Contribution 273 -
Royalties Revenue 677 1,027
Contribution 405 845
Total Revenue 8,353 7,659
Contribution 1,350 2,685
Other revenue 198 324
Other Income 854 132
Synerject 719 430
Research and Development (1,686) (610)
Other expenses (3,161) (2,801)
Finance costs (361) (447)
Profit before tax (2,087) (287)
Taxation (507) (102)
Profit after tax (2,594) (389)
Operating revenue for the half year ended 31 December 2008 increased by 9% to $8.4 million. This was a result of the acquisition of Orbital Gas Products (OGP) which contributed sales of $3.6 million (2007: $nil).
Engineering revenue and royalty income were each lower than the same period last year as a result of the tough global economic conditions which have affected Orbital's customers in all business sectors.
OGP revenue of $3.6 million is in line with the acquisition plan, generating a contribution of $0.3 million; a 20% annualised return on average operating assets.
Other income has increased by $0.7 million being net foreign exchange gains on translation of US$ net monetary assets.
Synerject LLC, Orbital's 50:50 joint venture with Continental Corporation, achieved a 9% increase in revenue as a result of launching new products most notably the M3 electronic control unit for motorcycle manufacturers Sanyang and Kymco in Taiwan and fuel systems for snowmobiles in Canada. This offset a sharp downturn in sales to Synerject's biggest customers BRP and Mercury Marine who operate in the North American marine market.
Notwithstanding the launch of a number of new applications, Synerject managed costs diligently to achieve a profit after tax of US$1.2 million, an improvement of US$1.5 million compared to 2007. Synerject generated operating cashflow after capital expenditure of US$1 million, an increase of US$2 million over 2007. Orbital's equity accounted share of Synerject's profit is A$0.7 million (2007: A$0.4 million).
Research and development expenses increased by $1.1 million to support development programs to enhance future returns in alternative fuels. Other expenses increased by $0.4 million including increased travel and allowance for doubtful debts.
