Automation developer Scott Technology has provided a ray of hope in a gloomy economic environment by signing a $7 million export order with a European appliance manufacturer.
Managing director of the Dunedin-based appliance-line and meat industry robotic developer, Chris Hopkins, told shareholders this week that the contract would provide a "base-line of work through next year".
The client has plans to roll out additional similar systems through to the end of 2011, but this was not guaranteed.
But to show just how difficult the business climate was, Mr Hopkins told the annual meeting in Christchurch that in recent months two orders had been cancelled and the company was looking at other options.
"Arising from the current world turmoil, there are opportunities to work with customers on automation projects that target efficiency and production processes, including reduced raw material usage and reduced energy consumption."
Earlier, the company reported an operating loss after tax for the year of $818,000 on revenue of $25 million.
Mr Hopkins said the new financial year had also started slowly, but he was confident momentum would grow. The 96-year-old company is aiming for $100 million turnover by its centenary, a goal Mr Hopkins said was achievable.
During the year under review, Scotts bought Rocklabs, a company which provides equipment for sampling rock from mines, a profitable venture which provides the parent company with regular sales and cashflow.
It also made its first commercial sales of automated boning room systems for the meat industry through its joint venture with Silver Fern Farms (Robotic Technologies Ltd).
Investment in research and development continued to be made into processing systems not only for the meat industry but also the dairy industry.
Scotts also built a new manufacturing facility and head office in Kaikorai Valley and during the year established a European office for its appliance division.
Looking ahead, Mr Hopkins said Scotts relied on 85% of its sales from outside New Zealand. Global markets had a major impact on its performance.
He believed the company would not only survive but grow under these conditions, given its strong balance sheet, adequate funds and new opportunities.
Chairman Stuart McLauchlan said Scotts was looking for further acquisitions that fitted within the areas in which it currently operated.
In the last year it has focused on continuing to be a leading exporter of value-added engineering and robotic technology and has resisted moving away from its core activities.
"This I believe will deliver a sound recovery of fortunes over the next few years as our past investment in research and technology development will deliver opportunities in the markets we operate in."
