SOME good news for Rosedale – the publicly listed manufacturing group, Energy Technologies saying it is well positioned to manage the economic fallout from COVID-19 (coronavirus).
It says its wholly owned subsidiary, Bambach Wires and Cables, which is establishing a factory in the town, has a strong order book for the next three months.
EGY managing director Alfred Chown said Bambach had received ongoing orders exceeding $2 million since early March, providing the base for strong orders in the 2020 June quarter.
“Orders were particularly strong among road and rail infrastructure customers who are predicting vigorous project flow going forward with a further $2-3 million of orders anticipated over the next three months.
“These current orders, as well as projections for future orders, indicate that Bambach is well placed to continue operating robustly at a time when COVID-19 is having an enormous economic impact elsewhere in the economy.”
Mr Chown said strong demand was also being driven by uncertainty about imports from China, which typically supplied a large percentage of Australia’s cable needs.
“Despite news of apparent success that China has the pandemic under control, informed sources suggest many factories across the country are suffering from shortages of staff, raw materials and packaging, and this is hurting their capacity to export across a range of products,” he said.
“EGY believes question marks around the supply of cable from overseas will not only increase the appeal of domestic manufacturers in the short term, but also longer term as customers look for certainty of supply in a post COVID-19 world.
“The issue of Australia’s dependence of China or elsewhere, whether it be exports or imports, will assume far greater significance once this pandemic has ended.”
Mr Chown said that Bambach’s new manufacturing plant at Rosedale was “in the final set-up stages”.
“Most of the equipment has been installed and the plant is producing a wide range of cables,” he said.
“New staff have undergone intensive training and are rapidly building competency.”
Full closure of the Bambach’s manufacturing plant in Brookvale, Sydney, is on track for June this year.
Closing this plant will realise large cost savings exceeding $1 million a year, based on current expenditure levels, from July 1, 2020.
Mr Chown adds that with factory transition nearly complete and a strong pipeline for orders, the company had received approval for increased trade finance facilities to increase working capital to fund raw material purchases.