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Dynetek Reports 2007 Six month and Second Quarter Results
- Record six month total revenues of $18.6 million - up 6% from the first six months of 2006
- Positive cash flow from operations of $1.0 million for the first
six months of 2007
CALGARY, (Aug. 14, 2007) -- Dynetek Industries Ltd, a leader in
the design, manufacturing and marketing of proprietary fuel storage cylinders
and systems for compressed natural gas (CNG) and hydrogen, today reported
results for the three months and six months ended June 30, 2007.
Financial Highlights:
- Total revenue for the six months ended June 30, 2007 of $18.6 million increased $1.0 million or 6% from the same period of 2006.
- Cash flow from operations of $1.0 million for the first six months of 2007 and cash deficiency from operations of ($1.1) million for the second quarter of 2007.
- Fifteenth consecutive quarter of positive EBITDA(1)
- Confirmed order book in excess of $14.9 million, with the majority to be delivered in the second half of 2007.
- Loss of ($2.1) million for the six months ended June 30, 2007 and ($2.3) million for the three months ended June 30, 2007 relates to the impairment of the future tax asset, which has been directly affected by the deferral of tenders for the European bus markets into 2008. The reduction of the future income tax asset is a non-cash
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Christian Rasche, President and Chief Executive Officer, pointed out that the second quarter revenues are also a result of Dynetek successfully
achieving all planned deliverables for the hydrogen fuel system development project for DaimlerChrysler in cooperation with Magna Steyr.
"The fact that all milestones of this challenging project were accomplished on time underlines once again Dynetek's expertise in the development and manufacturing of storage systems for hydrogen and natural gas."
Despite second quarter cylinder and system sales being 27% lower than in Q2 2006, Dynetek was still able to increase total revenue for the six months ended June 30, 2007 by $ 1.0 million due to increased research and development revenues, stronger component sales and intensified contract development service activities. This highlights the importance of the diversification of Dynetek's product offering that allows the Company to buffer market demand variations for the different products.
As indicated in our news release and interim report for Q1 2007, the reason for lower than expected cylinder and systems sales is a result of
requests for tenders by many European bus manufacturers being unexpectedly deferred until later 2007 and into 2008.
"For this reason we expect that our European cylinder and system sales in Q3 and Q4 2007 will be lower than the levels achieved in 2006 for the comparable periods. Dynetek is undertaking measures to control spending and to increase activities in other areas to minimize the impact of the slower than expected European market, The lower revenues for CNG cylinder and system sales will be compensated with a higher
revenue in R&D activities which reflects the increasing activities in the
hydrogen market," commented Mr. Rasche.
"We expect the activities in the European market to pick up by Q1 2008. Dynetek is very well positioned in the CNG market place where opportunities will enable the Company to achieve the long-term."
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