The board and management of NZX-listed Blis Technologies Limited are upbeat
about future prospects even though a doubling of revenues to $5.6M hasn''t yet
translated into profitability.
CEO Mr Brian Watson said while a consolidated net deficit for the 12 months
to 31 March 2016 of $816k (a reduction from that of March 2015: $1,373k) was
disappointing, the amount of positive structural change going on inside the
company had added expense which impacted the result. The operating deficit
before interest expense depreciation amortization and taxation was $347k in
line with the February guidance of a small deficit.
"There was a significant planned increase in overheads for the year, some of
which we would not expect to recur and most of that added cost involved
structural changes that will translate to benefit in coming years. I am
positive about results in coming years."
Those costs included transition costs involved in changing CEO. Mr Watson
came in as new CEO in February 2016 while outgoing CEO Dr Barry Richardson
took on specific projects to assist the board following his announcement of
an intention to retire so there was crossover during that process. Added to
this was board member Tony Offen being brought in as Executive Director to
provide additional management support.
Mr Watson said increased costs were required to meet the company''s growth
targets and in ensuring the company is resourced to meet its strategic
objectives. This has involved outsourcing of specialised personnel until
those resources are internalised, however good progress has been made with
the recent key appointments of Quality Control Manager and Chief Financial
Officer.
He said some of the deficit is also associated with replacing discoloured
product in Europe that was reported to the market in November 2015.
"However, the benefits from long term investment in regulatory approvals and
the more recent broadening of the business to include the manufacture of
part-finished goods, consumer products and other food products are now
flowing through."
Mr Watson points to year-on-year revenues continuing to grow and the company
recording an operating cash surplus for the final quarter of the year.
"We expect to report a net surplus for the year to 31 March 2017," he said.
Revenue from ingredients, consumer products, part-finished goods and
nutritionals are all higher than for the previous year. Significantly, both
Europe and North American revenues continue to grow being $2,117k (up 155%)
and $1,470k (up 121%) respectively.
Trading revenues for Australasia are $1,164k (70%) up on last year, and sales
into Asia have increased, but China remains slow due to the long cycles to
meet regulatory requirements and restrictions on product formats.
Sales of $421k (2015: $128k) were achieved for nutritional formulations
during the financial year highlighting the benefits of maintaining RMP status
for the production facilities. Revenue for the year includes contract
manufacturing income of non-BLIS branded product available to the company due
to the RMP status of the production facilities of $124k (2015: $102k).
END
Mr Watson can be reached for further comment through communications advisor
Del Carlini on 021 709 907.
End CA:00282826 For:BLT Type:FLLYR Time:2016-05-23 11:00:19