Rakon Falls Most in 20 Months as Earnings Miss Forecast
Rakon Ltd. (RAK), a supplier of crystal oscillators for global positioning systems, fell the most in almost 20 months in Wellington trading after reporting earnings that were lower than the company previously indicated.
Earnings before interest, tax, depreciation and amortization were NZ$24.8 million ($20 million) in the year ended March 31, Rakon said today. The result was less than the NZ$25 million to NZ$30 million range the Auckland-based company forecast in November. The stock fell 7.3 percent, the biggest drop since Sept. 23, 2009.
Rakon is expanding production in response to demand for the oscillators, which are used in smartphones and are a component of femtocells, which companies such as Vodafone Group Plc (VOD) and AT&T Inc. employ to improve mobile network coverage. The company faced higher costs and depreciation as it builds a new plant in Chengdu that will open in mid-2011 and increased capacity in India and the U.K.
Rakon fell 9 cents to NZ$1.15 at the 5 p.m. market close in Wellington.
To contact the reporter on this story: Tracy Withers in Wellington at email@example.com
To contact the editor responsible for this story: Edward Johnson at firstname.lastname@example.org