The Veem (ASX:VEE) share price is soaring 14% today. Here's why

The Veem (ASX:VEE) share price is soaring 14% today. We take a look at the latest results driving the shares higher.

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The Veem Ltd (ASX: VEE) share price is soaring 14% in early afternoon trade.

The sharp gains come following the company's release of its results for the first half of the 2021 financial year.

Veem is a marine technology company that produces propulsion and stabilisation systems for private, commercial and government vessels.

What results did Veem report?

In this morning's ASX release, Veem provided an unaudited update on its expected results for the half year to 31 December 2020. It said the audited results will be released later this month.

The company reported revenues of $28.4 million for the half year. That's up 36% from the previous corresponding period.

Earnings before income, tax, depreciation and amortisation (EBITDA) of $5.7 million were up 111% from the first half of the 2020 financial year. Veem noted that figure includes $1.5 million it received from the government's JobKeeper program.

Net profit after tax (NPAT) posted a 233% increase from the previous corresponding period, reaching $3.0 million.

The company said its gyrostabilisers sales were particularly strong, with the $3.6 million in revenue up 73% from the previous corresponding period.

Earnings per share (EPS) of 2.3 cents were up 229%.

Commenting on the results, Mark Miocevich, Veem's managing director said:

The continued increases in sales of VEEM Gyros with minimal increase to the overhead burden should continue to see the business generate strong EBITDA and cash flow. Across the business, and within Gyros, propulsion and defence specifically, we continue to see evidence of strong sales and profit potential for the rest of 2021.

VEEM is in the strongest position it ever has been with an existing robust core business which has allowed us to invest and support our focus on the rapid growth of our disruptive VEEM Gyro product into the global marine market. Following the signing of the framework agreement with Damen, one of the largest European shipbuilders, we are now on the cusp of delivering on what we have known for some time is a game changing opportunity.

Veem share price snapshot

Veem shares have been a star performer over the past year. The company proved highly resilient to the COVID-19 market rout, with the share price falling less than 6% from late February through to 23 March.

Over the past 12 months the Veem share price is up 79%. In 2021, shares are up a more subdued 2.4%.

By comparison the All Ordinaries Index (ASX: XAO) is flat over the past 12 months.

Motley Fool contributor Bernd Struben 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.

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