Turbotec Products Plc ("Turbotec" or the "Company") announces its results
for the 3 months to 30 June 2006. The Company is obliged to report
concurrently with its parent company Thermodynetics Inc., which being NASD
quoted is required to announce trading results on a quarterly basis.
Turbotec is engaged principally in the design and manufacture of energy
saving heat transfer and heat reclamation products. Its enhanced surface
tubing provides higher energy efficiencies for applications in the
biomedical, aerospace, automotive, boiler, marine, ice machine, swimming
pool and spa, food and beverage and residential/commercial heating and
cooling industries. These tubing products support a wide array of
component and heat transfer needs, including surface-enhanced tubing,
single and double wall co-axial condenser and evaporator coils and heat
recovery systems.
Overview
Following a positive trading period, revenues increased by 25% to $5.68
million (Q1 2005: $4.53 million). Likewise, profit before tax displayed a
healthy 37% increase to $459,000 (Q1 2005: $334,000).
Although there has been some weakening in residential construction during
the past few months, the overall demand for Turbotec's products has
remained at steadily higher levels than prior first quarter periods.
The increase in sales reflected a number of improved market conditions.
These included strengthened conditions in both retail and commercial
property markets where demand for heating, ventilation and air
conditioning systems resulted in a growth in orders for coaxial coils
using the Company’s enhanced surface tubing. In addition the Company
witnessed an increasing demand for specialty boiler tubing as a result of
strong expansion by a key customer.
Furthermore, Turbotec's special purpose enhanced surface titanium tubing
is being favourably received by swimming pool and spa heat pump
manufacturers which are ordering at an increasing rate. The Company is
also beginning to experience interest from other market segments needing
extremely durable metal heat exchangers.
During the period, personnel have been added in customer service and
product engineering and the Company is confident that future capacity is
in place to meet anticipated demand.
Despite the significant increase in metal costs over the prior year
period, Turbotec has maintained its overall gross margins by increasing
efficiencies on the production floor through the implementation of
streamlined manufacturing processes. This has served to offset increasing
prices of copper and other metals which are expected to continue to place
pressure on gross margins in the near term as the company is able to only
pass through a portion of the commodity price increase to customers. In
addition tubing mills have begun to accelerate payment terms and assess
additional surcharges. Despite these
pressures, the Directors remain confident of meeting profit expectations
for the year.
Sunil Raina, Managing
Director, Turbotec Products Plc, Commented:
"The
first quarter has been a solid period for the business with our
strengthened product range and enhanced marketing effort paying dividends.
Further investments in marketing and engineering are planned later this
year as the Company continues to expand its product development in heat
reclamation and titanium based heat exchangers."
11 August 2006
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