Computer chip manufacturer Rakon has reported a strong half year profit, as it continues to benefit from high global demand due to ongoing shortages.
Computer chip (stock image) Photo: 123rf
Key numbers for the six months to 30 September compared to a year ago:
- Net profit after tax $18.9 million vs $4.6m
- Revenue $85.4m vs $59.5m
- Underlying operating earnings $26.4m v $11.4m
The company, which produces chips for 5G telecommunications networks and devices, said the demand for its frequency control and timing products has been strong.
Underlying operating earnings more than doubled, driven by gross margin improvements and managing supply risk, it said.
Rakon chair Bruce Irvine put the result was down to the company's ability to secure and deliver new business as a result of the global chip shortage.
"Our 50-year track record of innovation and technology leadership, combined with long-standing relationships with some of the world's leading technology companies, has ensured that we remain at the forefront in developing the next generation technologies."
Managing director Brent Robinson said core business growth continued to be led by telecommunications products, particularly in 5G networks and data centre equipment, and increasing demand for positioning solutions.
He said the company was also able to adapt and scale up its operations to secure new business.
"Notably, this strong performance has been achieved in the face of considerable disruption to the global supply chain and the challenges of the global pandemic. It is a testament to the team, and the resilience and flexibility that has been embedded into the business over recent years.
"It has been a challenging half year, but we are delighted with the progress we have made and excited about the opportunities we see emerging across our core market segments."
Rakon said it also celebrated a milestone in starting the delivery of new chips designed specifically in response to global shortages.
"The entire process from design to manufacture was completed in just three months and we have been delighted with the outcomes achieved from these efforts," said Robinson.
Telecommunications revenue grew nine percent to $41.7m, generating 49 percent of Rakon's total revenue for the period.
Space and defence revenue increased four percent to just under $12m and positioning revenue grew 108 percent to $12.5m.
Robinson said orders were in place to deliver further revenue growth for the remainder of the 2022 financial year.
He said underlying operating earnings is expected to be between $44m to $49m for the year ending 31 March 2022.