Rakon HY2018 Preliminary Results Announcement

COMMENTS 16 November 2017 Return to profit for half year 2018; Full year earnings on track o Net profit after tax of NZ$0.9 million vs Net loss of NZ$5.7 million in prior half year (HY2017) o Revenue up 7% in USD currency basis on HY2017 o All key market segments showing growth vs. HY2017 o Strong positive operating cash flow of NZ$4.9 million for the half year period o Net debt of NZ$0.3 million reduced from NZ$19.7 million in HY2017 and NZ$4.5 million at FY2017 An improved performance has seen global high technology company Rakon return to profit, posting a net profit after tax of NZ$0.9 million on revenue of NZ$48.3 million for the half year ended 30 September 2017. The company also reported Underlying EBITDA of NZ$3.8 million. Rakon Managing Director Brent Robinson said that the company had achieved modest revenue growth across the prior half year, with that growth also across all its key market segments of Telecommunications, Global Positioning and Space & Defence. While the Telecommunications market remained subdued, the company had continued to position itself for the future with strong sampling for two new product platforms that can lead customer's next generation technology requirements. "It was pleasing to see both improved margins and a reduction in operating costs, where action had been taken in recent years to improve results". The company had generated positive operating cash flow in the period of NZ$4.9 million that has helped to reduce net debt to NZ$0.3 million. Following the half year, the company had announced a partial sale of shares in its Thinxtra investment that will generate a total consideration AU$3.0 million and a profit before costs of AU$1.8 million on its initial investment. This gain along with a higher second half revenue forecast, meant the company was expecting an increase in second half earnings vs. the first half result. Earnings guidance is maintained as, expecting to report Underlying EBITDA in the range of between NZ$10.7 million and NZ$12.7 million. The Directors confirm that this HY2018 preliminary results announcement is based on unaudited results and that no dividend is declared for the first half. Brent Robinson Chief Executive Officer & Managing Director -ends- Media Enquiries: Louise Howe (Media Liaison) 021 206 0985 www.rakon.com End CA:00310417 For:RAK Type:HALFYR Time:2017-11-16 08:48:54