Dynex Power Announces Year End Results for 2008
Lincoln, England, April 17th, 2009 – Dynex Power Inc., a leading, high power semiconductor company, today announced results for the year ended December 31st, 2008.
Revenue growth of 23% in 2008 reflected the continued strong demand in the market place for Dynex products. The increase in volume together with a particularly favourable product mix in the first half of the year resulted in the gross margin rising from 22.7% to 28.3%. The gross margin in 2008 of $10.5 million represented an increase of 52% over 2007. A 34% increase in expenses reflected significant one-off costs associated with the acquisition of a majority stake in the Company by Zhuzhou CSR Times Electric Co., Ltd of Hunan Province in the People’s Republic of China and costs associated with preparing the Company for further growth in 2009.
The growth in the order book continued during 2008. Orders taken of $49.0 million were 15% higher than the previous year and gave a book to bill ratio of 1.3. Such a level of order in-take, combined with a record year-end order book of $37.7 million, gives management confidence that further growth in revenue can be achieved in 2008. However, the exceptionally favourable product mix seen in the early part of 2008 is not expected to be repeated and net earnings are expected to fall in 2009. In addition, due to the exhaustion of brought forward tax losses in the UK, the Company expects to incur a tax charge in 2009.
Dr. Paul Taylor, President and Chief Executive Officer commented, “this has been an historic year for Dynex. The acquisition of 75% of our common shares by CSR Times Electric brings us the support of a strong parent company and the opportunity to play an even more active role in what is probably the strongest growing economy in the world. Our co-operation with CSR Times Electric is still at an early stage, but already we can see that there are many new opportunities from which we can benefit. We have pushed ahead in 2008 with the installation of a 6 inch bipolar fabrication facility, we have begun to build a new, special test facility for high power thyristors and we expect to start soon on an expansion of our IGBT facility to service the massive and rapid expansion of the China rail networks. At the same time, we have been able to report an excellent set of results, with strong growth in revenue, another excellent improvement in gross and net earnings and a record order book."
Bob Lockwood, Chief Financial Officer commented, “we are delighted to be able to produce an outstanding set of results in the current climate. Strong growth in revenue and another significant improvement in gross margin has enabled us to more than double our net earnings compared to last year. The strength of our order book and the expansion plans that Paul Taylor has referred to and our relationship with CSR Times Electric all point to an exciting future. But 2009 will also be a difficult year in many ways. A less favourable product mix and the need to provide for tax in future means that net earnings are expected to fall next year. We also need to be conscious of the current recession affecting most of the world’s major economies. We have not seen too much affect of the current economic troubles on our business to date, but we cannot ignore the possibility that we will be affected at some point in the future.”
Mr Lu, Chairman and President of CSR Times Electric, concluded, “CSR Times Electric is delighted to have completed its first overseas acquisition and we are excited by the opportunities that arise from CSR Times Electric and Dynex working together in the future. The management of Dynex has delivered an excellent set of results for 2008 and we look forward to working with them to produce even better results for all Dynex shareholders in the future.”