ProPhotonix upbeat after solid first half

Designer and manufacturer of high-tech LED and laser systems ProPhotonix confirmed its term debt was fully repaid by the end of June in a trading update on Friday - a total of $3.3m of principal and interest since the restructure of the notes in June 2013.

The AIM-traded company said the remaining non-trade debts of $1.3m related to equipment leases and the sales discount facility which has been in place for around nine years.

Revenue for the first half 2017 was expected to be approximately $8.3m, an increase of 4%, which the board said stemmed from an increase in sales to several major customers, partially offset by a decrease in sales to one large customer that converted to an alternate technology in the second quarter of 2017.

Operating income for the first half was expected to be approximately $0.5m, a decrease of approximately $0.25m, which the board said was a reflection of the investment the company was making for future growth.

It also pointed to increased sales expenses from the hiring of additional staff in the fourth quarter of 2016, increased engineering and development costs associated with several large original equipment manufacturing projects, and the continuing investment in the UV LED product development.

The order book for the second half of 2017, stood at $6m at the end of June, compared to $5.7m at the same time last year, and the company said it was continuing to trade in line with market expectations for the full year.

“We continue to position ProPhotonix toward future revenue growth and profits,” said CEO Tim Losik.

“With the term debt repaid, we are making further investments in personnel, capital, and product development to enable the growth of the company.

“These investments may depress the short term profitability though we expect will enhance future performance.”

The ProPhotonix board said it expected that the company's unaudited interim results for the six months to 30 June would be released in early September.