Rakon is a global high technology company which was founded in 1967 by Warren Robinson. Rakon designs and manufactures advanced frequency control and timing solutions. The company has four manufacturing plants, including two joint ventures plants, located in New Zealand, France, India and China and five research and development (R&D) centres. Customer support centres are located in ten offices worldwide.
The company's focus is on enabling next generation technologies in the telecommunications, global positioning and space & defence markets.
Rakon designs and manufactures advanced frequency control and timing solutions for telecommunications, global positioning and space and defence applications. Rakon products are found at the forefront of communications where speed and/or reliability are paramount. The company's products provide extremely accurate clocking signals, which are then used to generate precise electrical, radio or optical signals in networks and systems around the globe. Additionally Rakon offers a broad product portfolio to meet its customers timing and frequency control requirements.
Whether it be within wired, wireless and fibre telecommunications networks, navigation devices, or satellites in space. Rakon products enable connectivity.
In May 2006, the company listed on the NZX, raising $66m in a 41.25m offering at $1.60 per share. Since listing, Rakon has achieved a number of key merger and acquisition milestones:
The following information was extracted from Rakon Limited's half year results, released on 27 November 2024:
HY25 financial results
Total HY25 revenue of $41.7m (HY24: $61.3m) was lower year-on-year, with strong revenue growth in Aerospace and defence unable to offset lower demand in Telecommunications and Positioning.
Telecommunications revenue was down 51% to $16.8m, and Positioning was down 23% to $5.5 million. Aerospace and defence delivered its highest ever revenue result, up 10% to $16.8m, and continues to validate Rakon’s strategy to invest in new high-growth market opportunities. AI & Cloud Infrastructure revenue is currently milestone-focused, with revenue expected to grow significantly from FY26.
Lower gross profit of $15.7m (HY24: $26.1m) and margin percentage of 37.8% (HY23: 42.6%) was primarily driven by lower order volumes in Telecommunications and Positioning and the impact on economies of scale.
Underlying EBITDA1 was $(7.3)m (HY24: $5.3m), with a net loss after tax of $(10.4)m (HY24: $0.5m).
“The first half reflected the challenging market conditions, particularly in Telecommunications and Positioning,” Altug says. “Gross margins were impacted by reduced sales volumes, $1.5m of increased inventory provisions, and one-off adjustments. Opex was impacted by $1.7m in unfavourable FX movements, and restructuring and acquisition proposal related costs.”
Rakon’s programme to reduce costs and carefully manage its working capital continues to advance effectively. Global workforce numbers are down by 22% year-on-year, keeping production utilisation at optimal levels while retaining necessary ramp-up capability. Effective efforts to drive inventory optimisation have carried over from FY24 and reduced inventory by a further 14% in HY25 to $51.5m (HY24: $60m).
HY25 Capex dropped by 6% to $6.9m with operating expenses relatively flat at $30m, reflecting the impact of Rakon’s cost reduction and efficiency initiatives in offsetting the company’s continued growth strategy investments.
Growth investments include Research & Development (HY25 $10.7m (HY24: $8.9m)), to extend Rakon’s technology leadership for securing future design wins and market share. It also includes expansion of facilities to ramp up production to meet current and future AI & Cloud Infrastructure, and Space orders – including orders from contract wins announced in 2024 to supply subsystems for two new LEO satellite constellations.
Rakon retains a strong balance sheet, with net assets of $148.3m. The company had $15.8 million in net cash at balance date, $2.1 million lower than a year ago.
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