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The technology sector is now New Zealand’s third-largest export earner, behind dairy and tourism, according to TIN, which monitors the performance of the country’s 200 largest technology firms in information and communication technology, high-tech manufacturing, and biotechnology.
New Zealand’s top 200 technology companies generated $10billion of annual sales for the first time with more than $7.3billion coming from exports, according to the 2017 TIN100 report.
"It’s not just a number but a marker that indicates that our technology exporters are well and truly entrenched as a critical part of New Zealand’s economic growth," TIN managing director Greg Shanahan said.
Pacific Edge chief executive David Darling said the company’s mainstay, non-invasive Cxbladder test was being adopted at an increasing pace by urologists in key markets.
"Medical products by their very nature have a high threshold of proof of performance before mainstream adoption and it’s great to see this happening now particularly in our home country of New Zealand," Mr Darling said in a statement yesterday.
Pacific Edge’s portfolio of Cxbladder products was now in the market with Cxbladder Resolve launched in New Zealand in late 2016, with a planned US launch later this year.
"Having four molecular diagnostic products across the clinical diagnosis and management pathway for urothelial cancer is a global first for any company," Mr Darling said.
Pacific Edge last week went back to its shareholders with a rights offer to raise $21.3million, which it will secure as it is fully underwritten by First NZ Capital Securities. While Pacific Edge rises on sales revenue from the US, the $21.3million is expected carry it through to 2018, with predictions the company will break even by full-year 2019.
Mr Darling said: "We’re a small company and our team continues to punch well above its weight in the global market. We remain firmly focused on high growth."
Technology sector revenues for 2017 rose 7.9% while exports jumped 8.5%, BusinessDesk reported.
The lift was mainly driven by exports to the US rising almost 19% to more than $2.4billion. ICT firms achieved the highest growth in North America, lifting revenues by 48%. Biotech also experienced a strong growth rate of 29%. Sales to Europe were up 3.1%, weighed on by the stronger euro, while sales to Asia grew 5.3%.
The sector generates around 10% of New Zealand’s exports and created 4352 more new jobs in the year, despite some cost-cutting measures. The companies now employ 43,437 full-time staff, or about 1.8% of the workforce, paying average salary of nearly $84,000.
Companies with revenue of more than $20million grew at twice the rate of companies below $20million. The 90 companies with revenues of $20million and above lifted sales 8.4%, compared to just 3.8% for the 110 companies with less than $20million, the report said. Larger companies benefited from greater access to investment and bigger balance sheets let them maintain aggressive growth strategies, weather adverse currency shifts, and undertake successful mergers and acquisitions, it said.
Wellington-based Datacom replaced Fisher & Paykel Appliances to take this year’s No1 TIN ranking for the first time with revenue of $1.6billion. F&P Appliances generated $1.15billion, it said. Fisher & Paykel Healthcare was third, with revenues of $894million.
Company chief executives were asked to outline the key challenges for the next year, the most prevalent being their ability to recruit and retain quality, skilled staff to satisfy ongoing demand growth, the TIN report said.
Additional reporting: BusinessDesk.