Ecoya says break-even in sight
Kiwi candlemaker Ecoya is forecasting an operating loss for the first half of 2013 but expects to break even by the end of the March financial year.
The company, which also sells Trilogy natural beauty products alongside Ecoya scented candles, held its annual shareholders meeting at Auckland's Northern Club today.
Ecoya reported a full year net loss of $218,000 in June, up from a $4m loss the year before.
Chief operating officer Stephen Sinclair told the meeting that revenue for the six months to the end of September was estimated at $12.1m, with a forecast year end target of $26.6m - up 18 per cent on the full 2012 year revenue of $22.6m.
Ecoya estimated it would make a $400,000 loss in earnings before interest, depreciation and amortisation for the first half to the end of September, due to the "frontloading" of its investment in brands during the half.
The first half was also seasonally slower, especially for the Ecoya brands.
The estimated operating loss including interest and depreciation for the period would be around $800,000.
Chairman Geoff Ross said the company was building a "platform of growth" with the brand investment, but he did not foresee a need for extra capital in the coming year.
He did leave the door open for Ecoya to acquire other companies in its sector but said that would be more likely in the 2013 financial year and would be funded in the same manner as the Trilogy purchase.
Ecoya sold 6.3 million shares, worth $4.75m, to partially fund the $20m purchase.
Ross also said the company was searching internally and externally for a new Auckland-based chief executive to lead both the Ecoya and Trilogy brands, following Craig Schweighoffer's departure for health reasons.
The CEO search was being led by director and former Air New Zealand chief executive Rob Fyfe, and an announcement would be made within two weeks.
Ross and his two Business Bakery investors Grant Baker and Sinclair would remain in their positions with the company.
Trilogy founder Sarah Gibbs was officially elected to the board at today's meeting and both Baker and Sinclair were re-elected to the board.