An erosion of sale prices has pushed technology company Rakon's books into the red, but the firm says it has seen a turnaround in the last six months.
The listed company, which makes components for global positioning systems, mobile phones and for aerospace industries, lost $5.4 million in the year to March compared with a $4.5 million profit the previous year.
Revenue rose 4% to $145 million.
Managing director Brent Robinson says a drop in sale prices offset improved sales volumes during the first half of the year, and the strong New Zealand dollar also dampened growth.
But he says trading strengthened in the second half of the year as demand picked up.
Brent Robinson says Rakon has cash reserves of $46 million which will help to fund planned expansion in China over the next 18 months.
He says the 2011 full year pre-tax profit should be in line with analysts' predictions of between $25 million and $30 million.