Eco-bulb maker sees light of day in buyer talks
Penny dreadful eco-bulb distributor and manufacturer Energy Mad is looking for a buyer for its business.
The Christchurch-based company, which is listed on the New Zealand stock exchange, said it had carefully considered various options for its future.
Its shares are trading at 2 cents each, compared with $1 a share at the time of listing in 2011 when it raised $5 million from shareholders.
‘‘Based on its financial position and prospects’’ Energy Mad is pursuing a potential sale of the business as one of those options.
‘‘Any such sale of the business would be subject to shareholder approval and Energy Mad will make an announcement in the short term regarding this sale if it is to proceed,’’ chairman Brent Wheeler said.
The 71 per cent shareholder of the company is the Nzx-owned Superlife fund.
In November 2016 Energy Mad borrowed $1m from Superlife at an interest rate of 20 per cent a year. Wheeler said he was unable to reveal more detail about the pending deal.
‘‘We haven’t completed it, which is why the announcement is open-ended, but we’re bound to silence at this point. We’re talking with people. It’s not an advertisement,’’ Wheeler said.
Energy Mad was established in 2004 and in 2007 it won the Deloitte Fast 50 as the fastest growing company in New Zealand for long-life energy-saving LED light bulbs.
The company boasted 90 per cent less energy use and bulbs that lasted 40 times longer, theoretically saving $3017 in electricity over a 40,000-hour lifespan.
But it was dogged by sales difficulties. A few weeks ago it warned of problems with the Victorian Energy Efficiency Target Scheme in Victoria, Australia, which was a key driver of sales and was likely to adversely affect the company.
For the six months ending September 2016 the company earned revenue of $3.7m compared with $2.5m for the six months ending September 30, 2015.
Australian revenue grew slightly to $3.1m but New Zealand revenue fell to $500,000 compared with $1.1m for the previous period.
The operating loss was $200,000, a ‘‘significant improvement’’ on the loss of $500,000 for the six months ending September 2015, the company said.