Calluna Plc has had a frustrating nine months since it floated on the Unlisted Securities Market last October. At the time, the Glenrothes, Fife-based manufacturer of 1.8 disk drives anticipated breaking even by June (CI No 2,531), but this has not happened. The reason apparently is problems with suppliers, so much so that an alternative […]
Calluna Plc has had a frustrating nine months since it floated on the Unlisted Securities Market last October. At the time, the Glenrothes, Fife-based manufacturer of 1.8 disk drives anticipated breaking even by June (CI No 2,531), but this has not happened. The reason apparently is problems with suppliers, so much so that an alternative precision die-casting supplier is being sought because the original one withdrew from the electronics sector. One major component – the company would not say which – is causing uncertainty, and Calluna is talking to the supplier and alternatives in an attempt to sort it out. Two further suppliers of different components have recently been secured and are already having a positive impact, according to the company. The figures are difficult to compare, as the full year figures are on a pro-forma basis. In the nine months to March 31 Calluna’s pre-tax losses were ú2.2m from turnover of ú847,000. In the year to March 31 losses were ú2.7m, up from ú1.7m losses the previous year, on turnover that rose 229% to ú991,000. In terms of technology, Calluna is continuing to develop higher capacity drives from 340Mb to more than 500Mb. The maximum at the moment is 260Mb. Sales and marketing director David Ruxton said that some of the new technology was ready and sampling, but the supply problem was holding up volume production. The increases are achieved through incrementing the aerial bit density round each track and increasing the numbers of tracks on the two-platter, four-head structure. Within a few weeks, Calluna will sign agreements with two distributors in the US. The drives will be sold there under the Calluna name; until now they have been re-badged. The company also has 28 distributors spread across 16 European countries. Despite the problems, Calluna has just introduced a second shift to its manufacturing line, and has an order backlog that significantly exceeds turnover for the year to March, according to the company. It is now predicting breaking even in volume production on a monthly basis some time during the year, but would not commit itself further, having been caught out once already. First quarter revenues this year are reported to be higher than ever. The flotation raised ú10.1m net of expenses but the company was coy as to how much is left. Ruxton offered a substantial percentage, but the company is debt-free. Calluna only has one real competitor, Integral Peripherals Inc, now that Ministor Peripherals International Ltd and Maxtor Corp have withdrawn from the 1.8 drive market. Calluna did say though that the latter may re-enter the market at some point. No dividend will be paid this time.