29 Jun 2020

Rakon posts profit, promises growth despite impacts of Covid-19

2:13 pm on 29 June 2020

The technology company Rakon appears to have withstood the impacts of Covid-19 reporting an improved profit on last year, and its directors are promising it will only strengthen.

Mobile phone masts have been damaged in England in recent days (file picture).

File image. Photo: citadelle/123RF

The company manufactures components critical to equipment providers for the telecommunications and civil defence sectors, and was considered an essential service during the New Zealand lockdown.

It reported a net profit of $4 million, up from $3.3m last year. Revenue also improved to $119m compared with $114m.

Rakon CEO Brent Robinson

Brent Robinson. Photo: RAKON

Managing director Brent Robinson said the telecommunications sector was gaining momentum and Rakon was in a good position to capitalise on it.

"We're continuing strong growth with revenue up 15 percent in telecommunications versus FY19 and we've seen 43 percent of this growth coming from the 5G segment.

"These are for new products developed for 5G applications and this shows a 150 percent growth in revenue versus 2019."

He said Covid-19 had also increased the demand for communications globally and operators were ordering more equipment to expand capacity.

The company was impacted by the pandemic, but not materially. Plants in India and Europe were disrupted with the various lockdown measures, as were New Zealand operations despite the company operating as an essential service.

All services are now operating at normal capacity.

Some shareholders have previously expressed frustration at Rakon's low share value, and wanted directors to offer the company up to the international market.

Robinson had said shareholders needed to be patient, and performance would improve.