Dunedin exporter runs hot

Otago gas fire manufacturer Escea - making its first shipment of fires to the US this week - is forecasting a nearly 60% increase in turnover to $10 million this financial year.

The three year-old Dunedin-based company has grown from eight staff in 2005 to 44 this month and remains confident it will be selling up to 3000 units this financial year, with turnover increasing from last year's $6.3 million to $10 million, chief executive Nigel Bamford said yesterday.

While the economies of New Zealand and export targets Australia and US are recession-bound and the New Zealand dollar remains stubbornly high and clips exporters' margins, Mr Bamford said the niche-market high-end manufacturer was maintaining growth for several reasons.

"We've never known anything but trading in high (New Zealand) dollar environment since we started," Mr Bamford said.

Any pull-back in the kiwi will work in Escea's favour and its high-end target market remains steady, especially after the 2001 September 11 terrorist attacks which prompted more Americans to stay closer to home, Mr Bamford said.

The inaugural shipment of 57 Escea units to Atlanta, Georgia, which are outdoor 16kW output models, retailing for $US4000 ($NZ$5390), are destined for US customers described by Mr Bamford as "home resort" builders, likely to spend "upwards of $US30,000 on a pool, decks, BBQ and outdoor fires".

Last year the Australian market, which has Escea sellers based in Western Australia and the on the east coast, accounted for about 20% of production, while the domestic market generally takes 80% or more of annual manufacturing.

As well Escea more than doubling staff numbers in the past two years, its Devon St premises have similarly increased floor space more than 100%, continually pushing through into adjoining commercial space.

Mr Bamford said attending a trade show in Atlanta recently had provided an introduction to the market and the shipment will be distributed around the US to various retailers.

"The trigger was having enough small orders, pre-sold, to make up the shipment," Mr Bamford said.

A New Zealander in the US, operating in a different sector, had spare capacity in his "third party logistics" operations in Atlanta to allow Escea to join the "virtual office" - an address, site, contact point and warehouse.

"From there, commission salespeople are able to distribute the gas fires," he said.

Escea has had an envious run in the annual Deloitte Fast 50 companies index, having remained in the Top 10 for the past two years - an index where revenue growth of some companies is often beyond 1000%.

Mr Bamford was confident in forecasts for the year, but acknowledged there will be a "general tightening" in the economy which will have a stifling effect on growth.

Before Escea was formally launched in 2005, founders Mr Bamford, a mechanical engineer, tradesman-toolmaker Alan McGregor and accountant Garth Milmine undertook three years of research and development.

They perfected a minimalist asthetic design and incorporated world-firsts such as cellphone activation, automatic thermostat setting and wireless remote controls.

Thecompany now has a range of five indoor and outdoor models and a new indoor gas fire is under development, for release later in the year.

It will incorporate drawing air for heating from outdoors rather than from already-heated air indoors, and a flue which can be ducted through a wall, rather than the traditional ceiling-to-roof line.

Mr Bamford acknowledges that gas has gone up in price more than 30% since last December, but maintains it remains one of the more efficient ways of making heat and has some of the lowest carbon dioxode emission levels.