Sarantel Group PLC (LON:SLG) said it is making good progress despite several setbacks that impacted the topline in the first half to March 31 2011. It is widening its client base and adding more military clients for its technology, with revenues from military applications up 26 percent from the previous first half.
Total sales were down at £1 million in the first half from £1.4 million.
The manufacturer of high-performance, miniature antennas for mobile and wireless devices said that during the period, its largest GPS customer failed to place production orders because of a technical problem with their best selling product.
This problem was not related to Sarantel's technology but negatively impacted GPS revenues.
Despite this setback, GPS revenues grew 1 percent and the company continued to expand its customer base. Sarantel is currently tracking more than 200 different sales opportunities across a very broad range of GPS applications which the board believes will drive significant revenue growth over the next two to three years.
Revenues for the company's rugged L1/L2 GPS antenna were delayed following a military customer's technical problem which was unrelated to Sarantel's antenna. This problem has now been fixed and orders have been placed, with deliveries scheduled in the second half.
Revenues from this product are difficult to predict as the US government's budget restraints caused the customer to re-schedule orders on two occasions, Sarantel said.
The pretax loss widened to £1.69 million from £1.52 million in the previous first half.
“The group's cash balance of £0.4 million was lower than expected due to the impact on revenues as two of our largest customers experienced internal technical issues which delayed orders in the first half. As a result of this, further funding is now required and the group is currently seeking funding to take the group through to cash breakeven and profitability,” the company said.
Last week, Sarantel said it received production orders for its 2nd generation rugged GeoHelix GPS antenna for use in military equipment from Selex Communications - a Finmeccanica company, and Thales UK Ltd.
Only days prior to that anouncement, it told investors of more “volume production orders” for its GeoHelix antenna from an undisclosed client.
The deals are expected to have a “material impact on revenues over the next 12 months.