Perth-based vehicle braking systems manufacturer Advanced Braking Technology has posted record-high first half revenue figures of more than $2 million on the back of stronger sales reflecting a continuing recovery in its core mining services market.
Perth-based vehicle braking systems manufacturer Advanced Braking Technology has posted record-high first half revenue figures of more than $2 million on the back of stronger sales reflecting a continuing recovery in its core mining services market.
Sales of its braking products returned to surpass pre-crash levels, with total revenue increasing by 14 per cent to $2.32 million for the six months to 31 December 2009 as compared to $2.04 million for the 6 months to December 2008.
With only a modest increase in operating expenses of $2.472 million (six months to December 2008 yielded $2.33 million), the company posted an after-tax loss of $447,000 compared with a loss of $572,000 for the previous corresponding period.
Improved performance also contributed to a slight reduction in cash reserves of $368,000, with a cash balance at 31 December of $1.5 million.
ABT managing director, Ken Johnsen said the recovery in Australian mining sector had the greatest impact on the results but events of the recent 12 months have reinforced the importance for the company of breaking into a mainstream market with its garbage truck brake, which is currently nearing the end of its development phase.
He said the garbage truck project was on track to achieve a "Proof of Concept" sign-off on 31 March 2010, representing the next critical milestone in its commercial development.
A prototype brake system has been in service with a local authority over the past three months, gathering important information that is being fed into the brake design destined for commercial sale.
"The successful development of the Garbage Truck brake will herald a new phase in the company's growth as we transition from a supplier to niche and specialty markets into mainstream global markets," Mr Johnsen said in a statement.
Full announcement below:
STRONG FIRST HALF FOR ABT WITH RECORD SALES AND IMPROVED TRADING RESULTS
Brake Manufacturer Posts All-time High First Half Revenue of $2.3M
New Garbage Truck Brake Development Nearing "Proof of Concept" Completion
Vehicle braking systems manufacturer Advanced Braking Technology Ltd (ASX: ABV) has posted stronger sales and operating results for the first half, reflecting a continuing recovery in its core mining services market from the impact of the Global Financial Crisis.
The Perth-based Company said today (Monday) that sales of its revolutionary braking products had returned to surpass pre-GFC levels, with total revenue increasing by 14% to $2.32 million for the six months to 31 December 2009 (Dec 2008: $2.040 million) - representing its best-ever first half performance.
This combined with solid progress on the Company's new garbage truck development project points to further progress in both its short- and long-term prospects for increasing shareholder value.
With only a modest increase in operating expenses of $2.472 million (Dec 2008: $2.333 million), the Company posted an after-tax loss of $0.447 million, compared with a loss of $0.572 million for the previous corresponding 6 month period.
This improved performance also contributed to only a modest reduction in Company cash reserves of $368,000, with a cash balance at 31 December of $1.515 million.
Revenue levels were bolstered by a strong recovery in the Australian mining sector, particularly with ABT's existing customer base that have benefited from improved commodity prices, reversing the trend of the previous year where higher export sales and development income offset weaker Australian sales. Revenue was split approximately equally across three main areas: brake sets, spare parts and development income.
Based on an improving inquiry rate and outstanding quotations, indications are that this sales growth will continue, particularly as overseas sales benefit from the global economic recovery, however it is still premature to provide any indications of the Company's full-year prospects.
"We are pleased with this very creditable first half financial performance, which reflects a relatively rapid and strong recovery from the impact of the GFC in our core markets," said ABT's Managing Director, Mr Ken Johnsen.
"This trading result demonstrates that the Company is well positioned for further growth and underlines the importance of a diversified product range and geographic reach to insulate the Company from sectorial fluctuations," said ABT's Managing Director, Ken Johnsen.
"The recovery in Australian mining sector has had the greatest impact on the results but events of the recent 12 months have reinforced the importance for the Company of breaking into a mainstream market with our Garbage Truck brake, which is currently nearing the end of its development phase."
Mr Johnsen said the Garbage Truck Project was on track to achieve a "Proof of Concept" sign-off on 31 March 2010, representing the next critical milestone in its commercial development. A prototype brake system has been in service with a local authority over the past 3 months, gathering important information that is being fed into the brake design destined for commercial sale. The Company's engineering team has commenced planning for the next phase of the program which will involve the build-up of a fleet of trucks under a pilot production program as the next step towards the commercial release of this breakthrough technology.
"The successful development of the Garbage Truck brake will herald a new phase in the Company's growth as we transition from a supplier to niche and specialty markets into mainstream global markets," Mr Johnsen said. "It also points to other opportunities in the heavy vehicle sector such as city busses and other frequently stopping vehicles."
The Company's patented technology is expected to provide significant operational cost savings in the demanding waste collection industry where a typical domestic collection vehicle has over 5 million brake stops in a 10-year service life. The technology also offers advantages including elimination of noise and particle emission pollution from vehicles typically used in built up areas.
Mr Johnsen noted that an important element in the recovery of sales within the Australian mining industry was increasing customer up-take of a fail-safe SIBS driveline brake for larger trucks such as concrete agitators.
"Mine safety inspectors, particularly in Queensland and Western Australia, are paying much more attention to road going heavy rigid trucks used in underground mines. ABT's new "Agi Brake" is providing operators of such equipment a means to significantly improve the safety of these with the provision of an auxiliary and autonomous emergency brake," he added.
