Ecoya beats 2013 earnings guidance as Trilogy dominates

Monday 22nd April 2013

Ecoya, the scented candlemaker which derives more sales from its Trilogy skincare products range, turned profitable on an earnings before interest, tax, depreciation and amortisation basis, beating its November prediction to breakeven this year.

Ebitda was more than $1.1 million in the 12 months ended March 31, with sales rising 18 percent to $26.6 million, the Auckland-based company said in a statement. It sees more growth in 2014 with revenue forecast to beat $30 million and ebitda to exceed $2 million.

"The forecast profit result at ebitda has been achieved on the back of the platform built in the first half of the year" when it invested in product, packaging and brand, Ecoya said.

Ecoya bought Trilogy in 2010 for some $19.2 million, with $10 million upfront and $9.2 million in cash and scrip based on earn-out targets. The skincare products range now accounts for 60 percent of group revenue, or about $16 million of the 2013 sales, with almost a third of that coming from Australia.

Before accounting for the Trilogy earnout costs, Ecoya turned an operating profit of some $204,000 compared to a loss of $3.6 million a year earlier.

The company reduced net debt by $1.8 million to $6.6 million as at March 31 from Sept. 30, and plans to "further reduce net debt through continued positive trading," it said.

Ecoya's biggest shareholder, Business Bakery LP, kept charge of the candlemaker when it appointed Stephen Sinclair as chief executive last year after Geoff Ross departed to lead Moa Group.

The Business Bakery is the investment vehicle for 42 Below Vodka founders Ross, Sinclair and Grant Baker, which they used to underwrite Ecoya's $10.1 million initial public offering in 2010. The firm has also taken a stake in financier and insurer Dorchester Pacific and floated beer-maker Moa last year.

Ecoya's shares were unchanged at 81 cents, having dropped 18 percent this year. That values the company at $49.6 million.

BusinessDesk.co.nz

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