Why the Veem (ASX:VEE) share price hit an all-time high today

The Veem Ltd (ASX: VEE) share price hit an all-time high in afternoon trade following a positive sales update. Here's the rundown.

| More on:
three building blocks with smiley faces, indicating a rise in the ASX share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Veem Ltd (ASX: VEE) share price hit an all-time high in afternoon trade today after the company released a positive sales update.

The Veem share price climbed to a record high of 88 cents but has since retreated to 84.5 cents as it nears close of trade today.

Based in Perth, Western Australia, Veem designs and manufactures marine propulsion and stabilisation systems for global luxury motor yacht, fast ferry, commercial workboat and defence sectors.

The company's market leading gyrostabilisers (gyros) significantly reduce the rolling motions of vessels in waves. In turn, this enables sea-time in rough conditions and also helps reduce sea-sickness.

What did Veem announce?

The company has achieved its sales target, with revenue recorded at $3.6 million for the half-year ending 31 December. The company sold 8 gyrostabilisers in what has been a growing market since 2018.

At current, the company's order book has $3.9 million worth of products. In comparison, the corresponding period in 2018 achieved just over half a million in revenue.

Veem said that almost all gyros sales were for superyachts, offshore supply vessels and charter boats. However, there were some retrofit sales to Damen – a Dutch defence, shipbuilding, and engineering conglomerate company based in the Netherlands. This included an offshore supply vessel in the Gulf of Mexico and a local West Australian charter boat.

After demonstrating the capacity of its new gyro facility, the VG1000SD, the company sold 2 units to Damen. Currently, Veem has a 3-year agreement with Damen for the supply of gyros as an option onboard its FCS workboats.

In addition, Mexican offshore contractor, Naviera Integral, will use the new gyro onboard its Damen FCS vessel in sea trials next month. Both companies have a strategic alliance together where Damen provides workboats to Naviera Integral.

Words from the managing director

Veem managing director Mark Miocevich welcomed the performance, saying:

We are very pleased to see the sales of VEEM Gyros continue to increase strongly and to have delivered on our guidance provided to the market for the first half of FY21.

Given our level of inquiries, orders in hand, the Damen frame agreement and increased capacity in our Gyro facility, we expect this sales trend to continue.

About the Veem share price

The Veem share price is breaking new ground today after bottoming out at a multi-year low of 37 cents in June last year.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Two parents and two children happily eat pizza in their kitchen as a top broker predicts a 46% upside for the Domino's share price
Consumer Staples & Discretionary Shares

Buy Domino's shares for a 50% return and attractive dividend yield

Morgan Stanley believes investors should be grabbing a slice of this stock.

Read more »

Three guys in shirts and ties give the thumbs down.
Share Fallers

Why Coles, Liontown, Lovisa, and Wildcat shares are dropping today

These ASX shares are having a difficult session. But why?

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Gainers

Why DroneShield, Healius, Newmont, and Paragon Care shares are pushing higher

These ASX shares are having a strong session on Tuesday. But why?

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

Why are ASX lithium shares like Pilbara Minerals crashing on Tuesday?

Lithium stocks are getting another whack today.

Read more »

two colleagues high five each other as they sit side by side at a long desk in front of their laptop computers in an office environment.
Mergers & Acquisitions

Guess which ASX small cap stock is rocketing 27% on 'transformative' merger

Investors are liking the look of this merger plan.

Read more »

a woman wearing red blows a big bubble with bubblegum from her mouth.

Is the surging Nvidia share price causing a stock market bubble?

Is one high-flyer a sign of investors getting too excited?

Read more »

Miner looking at a tablet.
Share Gainers

Guess which ASX lithium stock just surged 94% on a deal with Mineral Resources

Investors are sending the ASX lithium stock rocketing following a joint venture agreement with Mineral Resources.

Read more »

a young woman props her hand under the face as she pokes her head out from under a luxurious doona in a bedroom decorated with flowers and a stylish lamp.
Share Market News

Why is the Lovisa share price sinking today?

Is today's decline bad news or good news?

Read more »