Wellington, May 22 NZPA - Global Positioning Systems (GPS) maker Rakon said today its March year net profit rose 4 percent to $10.9 million.

It said the high New Zealand dollar and higher depreciation and amortisation charges offset the growth in Ebitda (earnings before interest, tax, depreciation and amortisation).

Revenue from ordinary activities rose 65 percent to $174.3m mainly due to the contribution for the full year from a European acquisition completed in early March 2007.

In line with its policy, no dividend was declared.

The company said the New Zealand business continued to generate strong revenue growth, up 26 percent in US dollar terms on the prior year underpinned by sales volume growth of 46 percent.

The strength of the NZ dollar reduced the revenue growth when measured in kiwi dollars to 9 percent.

Ebitda rose 26 percent, or $5m, to $25.4m on the prior year and in line with guidance given in February 2008. It included a $2m one-off gain on to sale of equipment by Rakon into a joint venture with Indian-owned Centum Electronics.

Higher sales volume and reduced manufacturing costs due to new product designs, material costs savings and labour efficiencies were more than offset by the effects of the strong dollar and reduced sales prices.

Capitalised investment in new equipment and intangible assets totalled $13.9m for the year principally related to further capacity expansion in NZ, increased automation in NZ and Europe and investment in new products in NZ and Europe.

It incurred $8m costs on research and development activities.

Rakon's joint venture with Centum Electronics was completed and the first of three tranches of equipment was shipped from France in late March 2008.

Rakon shares have plunged from $5.80 a year ago to $3.30 although they have recovered from a low of $2.05 on May 18.

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