Dunedin-based niche engineering company Scott Technology rounded off its calendar year announcing orders for more than $US6 million ($NZ8.47 million) of appliance lines to the US, plus another order for a meat robotics system in New Zealand.
Scott’s revenue for the past year was 84% derived from outside New Zealand and with the emergence of Donald Trump as US president-elect, there have been some concerns for Scott. Scott’s revenue for the year was up 55% to $112 million and before-tax profit rose 36% to $11 million.
About 60 people attended Scott’s annual shareholders meeting, hosted this year at its Christchurch plant on Thursday.
In announcing the $US6 million order and the robotics order, Scott chairman Stuart McLauchlan said there had been a significant increase in output from the company’s facilities in New Zealand and Australia and global staff numbers now exceeded 400.
"These orders, along with other recent orders for mining systems, superconducting magnets and robotic welding cells, maintains a substantial order book across our business units," he said.
However, exports led Scott’s revenue and Mr McLauchlan said post-US election talk of tariffs and punitive actions against trading nations selling into the US market had raised the prospect of trade wars.
That scenario would undo all the progress that had been made to lift tens of millions of people around the world out of poverty, he said.
"We are hopeful the incoming leadership in the United States continues the work of previous administrations to liberalise trade flows around the world, which have brought substantial benefits to many nations and their people over the past few decades," Mr McLauchlan said.
After global food giant JBS bought a 50.1% controlling interest in April, Scott repaid all its debt. As at the end of August it had $34.2 million cash to underpin in-house growth and consider more acquisitions around the world.
Managing director Chris Hopkins said there was a "significant increase" in revenue, from
$72 million a year ago to $112 million, including "very strong growth" in meat processing, which outpaced increases in other target industries over the year.
Mr Hopkins said he had predicted a year ago that revenues from the meat-processing sector would nearly double.
"We actually achieved revenues from meat-processing customers of three times that of 2015," he said.
However, he sounded a note of caution that demand for Scott’s technology from different end customers changed from year to year, which was one of the reasons for the company to maintain the diversified range of industries it operated in.
During the past four years, different industries had dominated Scott’s activity and, ultimately, performance: mining in 2013, appliances in 2014, industrial automation in 2015 and meat processing in 2016, Mr Hopkins said. The majority of Scott’s technology and equipment was New Zealand and Australian designed and built, then delivered around the world, supported by local offices, he said.
However, Scott now had "a very impressive global footprint", which Mr Hopkins said was in line with a strategy to design and manufacture wherever it was most efficient, but to deliver and support locally for all Scott’s major markets.
Mr Hopkins said Scott could expect accelerated growth, which was already happening, underpinned by the additional new capital in hand and support from JBS. Even though Scott’s first commercial sale of its robotic meat system happened seven years ago, it took five more years to convince the meat-processing sector the technology could deliver the promised benefits.
"There’s strong demand from both our new shareholder customer, JBS, and from our many external customers to transfer and adapt the technology to other species, including beef and pork ... and we’re confident it will be a faster path than our original lamb-processing systems," Mr Hopkins said.
