NetComm forecasts 1H ebitda loss

NetComm forecasts 1H ebitda loss

Broadband product provider NetComm (ASX:NTC) has forecast a swing to a $400,000 ebitda loss in the first half of FY12.

The company, which develops products including routers and M2M access devices, blamed the expected result on a substantial slowdown in orders from Telstra (ASX:TLS).

Revenue for the half is also projected to decline to between $23 million and $24 million. The forecast compares to revenue of $31.4 million and an ebitda of $2.6 million in 1H11.

But because its orders from international carriers and for M2M products are typically weighted to the second half, the company announced it expects its full year performance to be broadly in line with FY11's underlying results. These included revenue of $67.7 million and ebitda of $5.1 million.

In a market update, NetComm said despite the 1H slowdown its outlook for forward orders is at the highest level in its history, but that most of these orders will be booked in FY13.

The recently-announced subcontract from Ericsson to provide devices for the LTE component of the NBN will also not generate revenue until next financial year.

NetComm had already advised in August that it expects its FY11 profit to be impaired by around $2.2 million, due to a decision to take a charge on its lossmaking services business

In FY11, the company's net loss shrank to $1.2 million, from $1.8 million a year earlier.

NTC shares stayed flat on Friday at $0.130.

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