Sydney based distributor Ambertech has deliver a 26% fall in profits after tax as the Company struggles in what their Chairman Peter Wallace claims, is a “tough market”, despite the fall sales are up following recent acquisitions and the inclusion of new products in their portfolio.

In their latest report the Company claims that the second half of the financial year is delivering “Notably tougher operating conditions” with their dealer network struggling and the Company facing the cancelling or delay of jobs.

Despite NPAT falling by 26% to $1.4 million (FY23: $1.9 million) CEO Peter Amos got a pay rise from $348,847 to $407,500 in 2024.

He also received a bonus of $20,000.

EBITDA coming in at $4.7M being down 4%.

The Company said that the delaying of projects by their customers impacted full-year earnings.

“Despite these hurdles, our team’s resilience and adaptability have been critical in navigating these complexities,” said Wallace.

He claimed that “This decline is attributable to a mismatch in costs, project delays and the execution of an inventory management plan and pricing adjustments”.

During the past six months the Company has been clearing “old stock” out of their warehouse for new stock that they hope will allow them to deliver higher margins.

On a positive note, the strong operating cash flow has allowed the business to “make significant strides in reducing debt” claims Wallace.

Amos claims that the Company is now a “leading authority” in the market after making several acquisitions that have boosted revenues.

Due to their acquisition strategy the business was able to deliver a 13% lift in revenues to $95.5 million Vs $84.2M in 2023.

The growth was achieved across all three divisions.

Management claim that “Constant interaction with distributors and partners at events provides critical collaboration allowing the business to identify market gaps and adjust Ambertech’s offering”.

“Over the year there was a divergence between sales and costs which were impacted by the implementation of strategies to inventory and pricing. The plan saw the clearance of older stock at more favourable prices, specifically within the retail segment of the business”.

As a result, gross margins, were reduced to33% from 34% in FY23.

The Company said The addition of Australian distribution rights for ABB (a prominent global leader in technology electrification and automation) and Zenitel (world leading provider of Intelligent Critical Communication Solutions) helped the business.

As for their retail business which is their smallest revenue generator, the Company is witnessing longer manufacturing lead-times on products which are impacting the group’s ability to deliver on marketing plans with retail partners.

Ambertech is currently working on optimising inventory holdings to offset risks associated with old stock.

“Even amid market volatility the retail group observed positive sales growth, driven by products that resonated with consumer demands, such as value and lifestyle inspired designs. We are optimistic about the potential for improved consumer sentiment and continue to enhance our retail experience by aligning the segment with innovative and technology leading brands” Amos claimed.

“The business remains well positioned to take advantage of a revitalisation of consumer sentiment” he concluded.

During the past month AmberTech shares have fallen 10% are are now trading at $0.170 having fallen from $0.190.