Wellington Drive shareholders like what they're hearing

Shares in electric motor maker Wellington Drive Technologies rose another 14 per cent today after jumping 9 per cent yesterday on news of a $40 million investment from the United States.

WDT's shares, which have travelled an erratic path since listing in 2000, rose 4 cents yesterday and another 7 cents today to 57 cents. That's their highest level since March 2004.

The company said yesterday Colorado-based Source Vortex would buy new equity in the Auckland-based company.

Source Vortex will also become actively involved in WDT's future development, appointing two nominees to the board.

Wellington Drive shareholders had still to approve the deal and final confirmation was needed from Source Vortex, a special purpose entity created by Conscious Capital Fund for the investment.

WDT said the capital raised through Source Vortex would allow it to significantly accelerate its sales growth and its programme to reduce production and logistics costs.

Under the deal Source Vortex would subscribe for 100 million ordinary shares, representing a 33.4 per cent stake in WDT, at 40c a share.

Source Vortex would also be issued with 35 million options.

WDT also released its results for the year to June which showed operating revenues, excluding interest, increasing more than three times to $6.88 million from $1.84m.

The consolidated loss before tax and unusual items was $4.53m, an improvement from a $4.89m loss a year earlier.

Revenues from product sales were $5.89m, compared to $1.55m a year earlier. No dividend was proposed.

WDT manufacturers and licenses electronically-commutated (EC) motors which have high energy efficiency compared to traditional electric motors.

Since substantial restructuring in 1998 its engineering and commercial activities have been focused on motor, controller and fan designs for the domestic and light industrial appliance market.

A report from WDT chairman Shawn Beck and managing director Ross Green said products supplied by WDT were now found in a growing range of appliances.

Final assembly of all WDT's motor types was now done in Asia, with positive effects from the transfer beginning to show in production costs.

With the supply chain stabilising, considerable effort was devoted to increasing sales, particularly in the second-half year, with sales activity now managed from Singapore.

In total WDT delivered more than 200,000 motors of all types in the year for the first time.

- NZPA