The Veem Ltd (ASX: VEE) share price hit an all-time high in afternoon trade today after the company released a positive sales update.
The Veem share price climbed to a record high of 88 cents but has since retreated to 84.5 cents as it nears close of trade today.
Based in Perth, Western Australia, Veem designs and manufactures marine propulsion and stabilisation systems for global luxury motor yacht, fast ferry, commercial workboat and defence sectors.
The company’s market leading gyrostabilisers (gyros) significantly reduce the rolling motions of vessels in waves. In turn, this enables sea-time in rough conditions and also helps reduce sea-sickness.
What did Veem announce?
The company has achieved its sales target, with revenue recorded at $3.6 million for the half-year ending 31 December. The company sold 8 gyrostabilisers in what has been a growing market since 2018.
At current, the company’s order book has $3.9 million worth of products. In comparison, the corresponding period in 2018 achieved just over half a million in revenue.
Veem said that almost all gyros sales were for superyachts, offshore supply vessels and charter boats. However, there were some retrofit sales to Damen – a Dutch defence, shipbuilding, and engineering conglomerate company based in the Netherlands. This included an offshore supply vessel in the Gulf of Mexico and a local West Australian charter boat.
After demonstrating the capacity of its new gyro facility, the VG1000SD, the company sold 2 units to Damen. Currently, Veem has a 3-year agreement with Damen for the supply of gyros as an option onboard its FCS workboats.
In addition, Mexican offshore contractor, Naviera Integral, will use the new gyro onboard its Damen FCS vessel in sea trials next month. Both companies have a strategic alliance together where Damen provides workboats to Naviera Integral.
Words from the managing director
Veem managing director Mark Miocevich welcomed the performance, saying:
We are very pleased to see the sales of VEEM Gyros continue to increase strongly and to have delivered on our guidance provided to the market for the first half of FY21.
Given our level of inquiries, orders in hand, the Damen frame agreement and increased capacity in our Gyro facility, we expect this sales trend to continue.
About the Veem share price
The Veem share price is breaking new ground today after bottoming out at a multi-year low of 37 cents in June last year.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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