TECHNOLOGY venture Pure Wafer has revealed pre-tax losses of £3.1m in the final six months of 2009.

The Swansea firm, which is listed on the Alternative Investment Market, saw revenue of £7.2m over the period. That compares to a turnover of £10.2m over the same six months in 2008. Pure Wafer reclaims high-quality silicon wafer for many of the world’s leading semiconductor manufacturers.

Despite the disappointing financial performance, the company said it saw volume sales recover over the six months, up 28% compared to the previous six months and it also continued its cost reductions, which meant that its cost per unit was 40% down.

Even so, volume sales were still 11% down on the comparative period to the end of December 2008. The increased volume allowed both of its manufacturing sites to return to full-time working during the period following seven months of short-time working.

Pure Wafer has also entered into the renewables energy market, coming up with a new product which sees waste material recycled for use as solar panels – photovoltaic cells.

Stephen Boyd, chairman, said: “We are pleased to report the continued recovery of the semiconductor market together with the subsequent increasing volume sales of our wafer reclaim services. While pricing pressure remains, our cost-reduction actions have resulted in a lower cost of manufacture of our product.”

Mr Boyd said the board was “encouraged” by the actions of the management team over the period to deal with the difficult trading conditions.

He went on: “During the period we successfully negotiated with our bank and asset funders, a financial restructuring package.

“The financial agreements comprised of rescheduling all the company’s existing debt over a six-year period which includes up to two years of capital repayment holidays, with initial capital repayments due to commence as scheduled in July 2010, together with an additional overdraft facility of up to £1.4m. The company continues to trade within its facilities.”

Mr Boyd said the directors had invested £300,000 in Pure Wafer as a condition of the company’s financial restructuring and “to demonstrate their commitment and confidence in the business”.

An open offer to shareholders which was made during August 2009 was well subscribed, raising £1.16m of funds. This, together with the placing of excess shares which raised £530,000, resulted in a total of £1.99m, before costs, being raised.

The period saw some changes to Pure Wafer’s management structure, with Giles Clarke stepping down from his position as non-executive director, having been a board member since 2004.

Jerry Winters joined the board as executive director responsible for US operations, which Pure Wafer said reflected the growing importance of the US market to the company.

Mr Boyd added: “Although it is too early to be confident about a sustained return to growth, recent trading since the period end, together with positive news of a long-term industry recovery, are encouraging signs from which we draw confidence for continued volume recovery.

“In January I am pleased to report we were Ebitda positive and our entry into the solar market is an exciting move for Pure Wafer and we are confident that this will provide additional revenue streams.

“This, together with our additional funding, gives Pure Wafer a strong foundation on which to move forward.”

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