The Motley Fool

Is there still time to buy Vmoto Ltd?

Vmoto Ltd (ASX: VMT) shares surged 12% on Monday after the company confirmed guidance of earnings between $2.5 million and $3.0 million for the 12 months ending 31 December 2014.

The scooter manufacturing and distribution group “continues to grow earnings, with normalised net profit (excluding one off expenses and impairments) after tax generated for the month of October 2014 of approximately A$537,000 (unaudited). Encouragingly, this is Vmoto’s best monthly profit to date, driven in part by increasing International sales where margins are higher than Chinese domestic sales, and highlights the positive growth path the Company is on.”

Vmoto specialises in the production of electric powered two wheel vehicles, as well as petrol scooters and four wheel all-terrain vehicles. The company has a global distribution network covering 27 countries in Asia Pacific, Europe, North America, South America and South Africa and is growing strongly. The question for shareholders is when they can start to expect dividends.

Earnings of around $3 million for the year would be a great first step, but I suspect the company will be looking for more acquisition opportunities in the short term.

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Motley Fool contributor Andrew Mudie does not own shares in any companies mentioned. You can find Andrew on Twitter @andrewmudie

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