Energy Mad to cut costs, grow sales
Energy-efficient lightbulb maker Energy Mad says it is continuing to rein in costs while focusing on growing sales in the United States, as well as New Zealand and Australia.
The Christchurch-based company said in a trading update to the market today that chief executive Paul Ravlich plans to shave $900,000 in costs in the 2014 financial year, particularly from the company's direct installation business.
Managing director Chris Mardon is tasked with growing sales particularly of the company's new 12V Ecobulb in Australia and lightbulb sales through US pharmacy giant Walgreens.
Energy Mad has secured $1 million in funding for projects with 21 US electricity utilities. That funding means Energy Mad's lightbulbs are being heavily discounted in more than 1000 Walgreens stores, without squeezing the bulb maker's margins.
The discounted pricing will stay in place for the remainder of 2013, the company said.
Energy Mad is in talks with US electricity utilities with the hope of running direct-mail promotions of its lightbulbs with them, as it has done with utilities in New Zealand.
The company reported strong sales of its spiral Ecobulbs in Australia for the first two months of the year. Sales were being boosted by a new energy efficiency scheme that started this year in the Australian Capital Territories.
Meanwhile in New Zealand the company continues to reduce costs in its direct installation business, which sells and installs Ecobulb downlights with associated insulation in homes, and plans to scale up that business.
It has introduced its new 12V Ecobulb into its direct installation business and based on initial sales, annualised sales amounted to about $1.2 million, the company said.
Last month Energy Mad announced it was expecting a to make a $1.1m loss for the 2013 financial year, because of delays in securing a further large United States order before the end of the financial year.
However, revenue for the year would be a 58 per cent increase on the previous year.
Energy Mad shares last traded at about 42 cents a share. The company listed on the NZX in 2011 for $1 a share.