Bamboo flooring products company Style Ltd has reported a full year net loss of $6.8 million on the back of lower gross margins, an increase in overheads and weaker than anticipated revenues.
The net loss, which includes one-off write offs and provisions of $2.3 million, follows the previous year's net profit of $100,000.
The one-off write offs include the $1.4 million termination of the Wanzai Plantation project and $700,000 for a settlement of a legal dispute with former franchisees in Australia.
Earnings before interest, tax, depreciation and amortisation - including one-off costs - was a loss of $5 million while revenue for fiscal 2008 was up 7.5 per cent to $21.4 million.
Style said the "disappointing" figures were a consequence of quality issues with its Floating Floor production which resulted in a complete halt of North American sale during the second and third quarters.
The halt brought about lower gross margins due to an unfavourable foreign exchange movements and a short term marketing incentive program during the second half to rebuild consumer confidence in the North American market.
Additionally there was a series of delays in the commissioning of essential manufacturing machinery which resulted in a five month delay to ramp-up production capacity.
At the end of the period, Style had a cash balance of $2.5 million.
