Orbital Engine Corporation Ltd (NYSE: OE): CEO Update
2003年10月28日 - 10:10AM
PRニュース・ワイアー (英語)
Orbital Engine Corporation Ltd (NYSE: OE): CEO Update PERTH,
Australia, Oct. 27 /PRNewswire-FirstCall/ -- Date of lodgement:
27-Oct-2003 Title: Open Briefing. Orbital Engine Corp. CEO's Q1
Update Record of interview: corporatefile.com.au Orbital Engine
Corporation Limited said at its recent AGM that profit after tax
for the first quarter ended September 2003 was $3.2 million ahead
of the previous comparable period, while underlying trading
generated cash of $0.6 million. Are you in a position to now give
firmer earnings guidance for the current year ending June 2004? CEO
Peter Cook There are certain non-recurring elements in the
first-quarter results, notably the timing of some license fees and
the receipt of ACIS credits, which did contribute to the good start
to the year. For the full year, we'd expect to see a better
performance than last year overall. We expect the year to be
profitable and cash positive. I'm reluctant to be more specific
given there are factors beyond our control, for example the
direction of the Australian dollar, which could have an impact on
our earnings. corporatefile.com.au Synerject, your 50:50 joint
venture with Siemens VDO Automotive, was restructured in April
2003. In the first quarter, Orbital's earnings share from the joint
venture was $0.4 million, up 16 percent. How does the Synerject
contribution compare with expectations and to what extent are the
benefits of the restructure being realized? CEO Peter Cook
Synerject continues to meet its targets and it's meeting the
expectations of both joint venture partners. corporatefile.com.au
Following the restructure, Synerject now controls the system sales
business and Orbital has three income streams - royalties, license
fees and fee-for-service income from engineering services. What's
been the trend in these three areas during the first quarter and
what are your expectations for the full year? CEO Peter Cook It's
worthwhile clarifying what we regard as our three business sectors.
One is Synerject, which we've just discussed. The second is
royalties and licenses, which we link together because they relate
to income from our intellectual property. And the third is our
engineering service activities. I'm pleased to report that
royalties and licenses are slightly ahead of the same period last
year and that engineering services are comfortably ahead of the
same period last year. We expect some growth in our royalty and
license income this year. It'll be positive but modest. We expect
to continue to improve our volumes and market share in existing
makes and models as well as planned new model launches. However,
that has to be taken in the context of a flat scooter market,
particularly in Europe, which is our major market, and a declining
personal watercraft (PWC) market. Also, we've advised the market
we're targeting 20 percent growth in our engineering revenue this
year. In our current environment, these are both fairly aggressive
targets. corporatefile.com.au Orbital raised a total of $6.2
million via a share placement and the offer of a share purchase
plan to existing shareholders. Is the improved financial position
enabling you to win more or better quality development projects?
CEO Peter Cook One of the reasons we targeted 20 percent growth in
the engineering services area was because of our strengthened
balance sheet. It's just one of the components we needed to put in
place to achieve that level of growth, and it's contributing.
corporatefile.com.au Orbital's overhead expenses fell nearly $6
million to $19.5 million in 2003, implying average monthly overhead
expenses of $1.6 million. What's been the overhead run rate during
the first quarter and what's the expected trend over the remainder
of the year? CEO Peter Cook Our first quarter run rate is on target
and we see very few difficulties with our overheads for the
remainder of the year. As we've said, we expect the annualized
impact of last year's overhead expense reductions to be picked up
fully in 2004. There'll be some further reductions based on
initiatives we'll take this year, but they'll be modest in
comparison. corporatefile.com.au Kwang Yang Motor Co. Ltd. (Kymco),
one of Taiwan's biggest motorcycle manufacturers, recently
announced it planned to use Orbital Combustion Process (OCP)
technology in models scheduled for release next year. What will
this mean for Orbital in terms of earnings? CEO Peter Cook I always
hesitate to predict the success of an individual make or model,
however there are certainly positive aspects for us. One is that
Kymco plans to launch a larger 100 cc capacity scooter in Europe,
which would be an innovation in that marketplace. Another plus is
that Kymco will be our first Asian scooter manufacturer, so our
product will now have some presence in the Asian markets.
corporatefile.com.au Why did Kymco adopt OCP technology and what
opportunities are there for OCP to be used by other Taiwanese
motorcycle makers? CEO Peter Cook Kymco saw the merits of our
technology a number of years ago in terms of the improved
emissions, the improved fuel economy and the easy start it offers
on scooters. But it'd be wrong to deny the impact Taiwanese
emissions legislation has had in the overall process. And the
success the European manufacturers have had with our technology
would also have played a part given the export markets are a
significant portion of Taiwanese producers' total build. We've also
had a long history with Sanyang, the other significant Taiwanese
scooter maker and even though it's chosen to compete with Kymco's
models using alternative technology, both Orbital and Synerject
have made a major contribution to the development of those models.
corporatefile.com.au You also recently announced that the New York
Stock Exchange has confirmed it no longer considers Orbital below
the US$1 listing criterion, but will continue to monitor the
company for another seven months. What's the broad purpose of the
NYSE's continued monitoring of the company and what happens after
seven months? CEO Peter Cook The NYSE's on-going listing
requirements are multi-factorial, only one of which is the share
price. It's only in relation to the share price that the exchange
has advised we're now in conformity. On two of the other factors,
shareholders' equity and market capitalisation, we've improved but
are not yet fully in conformity with its stated requirements. So
the exchange will continue to monitor our progress at regular
intervals through to April 2004. At that time it will consider our
overall progress, which has been positive up until now. (Q) Thank
you Peter. For previous Open Briefings with Orbital Engine, visit
http://www.corporatefile.com.au/ For more information about Orbital
Engine, visit http://www.orbeng.com.au/ DATASOURCE: Orbital Engine
Corporation Limited CONTACT: Keith Halliwell of Orbital,
+618-9441-2311, or in the US 1-866-714-0668 Web site:
http://www.orbeng.com.au/ http://www.corporatefile.com.au/
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