Rakon 1H22 Results Announcement

Results announcement







Results for announcement to the market
Name of issuer Rakon Limited (RAK)
Reporting Period 6 months to 30 September 2021
Previous Reporting Period 6 months to 30 September 2020
Currency NZD

Amount (000s) Percentage change
Revenue from continuing
operations
$85,416 +43%
Total Revenue $85,416 +43%
Net profit/(loss) from
continuing operations
$18,928 +308%
Total net profit/(loss) $18,928 +308%
Interim/Final Dividend
Amount per Quoted Equity
Security
No dividends are proposed to be paid.
Imputed amount per Quoted
Equity Security
Not Applicable
Record Date Not Applicable
Dividend Payment Date Not Applicable
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$0.50 $0.40
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
Please refer to the accompanying comments and the unaudited
interim financial statements released in conjunction with this
announcement
Authority for this announcement
Name of person

authorised
to make this announcement
Maureen Shaddick, Company Secretary
Contact person for this
announcement
Anand Rambhai, Chief Financial Officer
Contact phone number +64 21 542 287
Contact email address anand.rambhai@rakon.com
Date of release through MAP

25/11/2021

Unaudited financial statements accompany this announcement.

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Rakon Limited Interim Report
September 2021

1
1

Table of Contents
Unaudited Consolidated Interim Statement of Comprehensive Income ..................................................... 2
Unaudited Consolidated Interim Statement of Changes in Equity .............................................................. 3
Unaudited Consolidated Interim Balance Sheet .......................................................................................... 4
Unaudited Consolidated Interim Statement of Cash Flows ......................................................................... 5
Notes to the Unaudited Consolidated Interim Financial Statements .......................................................... 7
Directory ..................................................................................................................................................... 14

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4

5

6

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7


Notes to the Unaudited Consolidated Interim Financial Statements
1. General information ........................................................................................................................ 8
2. Statement of accounting policies .................................................................................................... 8
3. Impact of Covid-19 .......................................................................................................................... 8
4. Segment information ....................................................................................................................... 9
5. Revenue ......................................................................................................................................... 10
6. Other operating income ................................................................................................................ 12
7. Borrowings ..................................................................................................................................... 12
8. Capital commitments .................................................................................................................... 13
9. Contingencies ................................................................................................................................ 13
10. Subsequent events ........................................................................................................................ 13

8
8

1. General information
Rakon Limited (the Company) and its subsidiaries (the Group) are a global technology company that design and manufacture
advanced frequency control solutions for a wide range of applications. Rakon’s core markets are Telecommunications, Space &
Defence, and Positioning. The Company is a limited liability company, incorporated and domiciled in New Zealand, and listed on
the New Zealand Stock Exchange (NZX code: RAK). The address of the registered office is 8 Sylvia Park Road, Mt Wellington,
Auckland.
The Company is registered under the Companies Act 1993 and is a Financial Markets Conduct reporting entity under Part 7 of the
Financial Markets Conduct Act 2013. The interim financial statements of the Group have been prepared in accordance with the
requirements of Part 7 of the Financial Markets Conduct Act 2013 and the NZX Listing Rules.
The unaudited consolidated interim financial statements have been approved for issue by Rakon’s Board of Directors (the Directors)
on 25 November 2021.
2. Statement of accounting policies
These consolidated interim financial statements for the half-year reporting period ended 30 September 2021 have been prepared
in accordance with New Zealand Generally Accepted Accounting Practice (NZ GAAP). They comply with New Zealand equivalents
to International Financial Reporting Standards (NZ IFRS), other New Zealand accounting standards and authoritative notices that
are applicable to entities that apply NZ IFRS, in particular NZ IAS 34 Interim Financial Reporting. The consolidated financial
statements also comply with International Financial Reporting Standards (IFRS). The Group is a profit-oriented entity for the
purposes of complying with NZ GAAP. These financial statements comprise Rakon and its subsidiaries, and have been prepared on
a going concern basis.
The financial statements of the Group have been presented in New Zealand dollars and have been rounded to the nearest
thousands unless otherwise indicated.
The preparation of financial statements in accordance with NZ IFRS requires management to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Actual
results may differ from these estimates.
The accounting policies applied are consistent with those set out in the annual report for the year ended 31 March 2021 with the
exception of the treatment of certain ’Software as a Service’ arrangements. The Group had previously capitalised costs incurred in
configuration or customisation of certain suppliers’ application software in certain computing arrangements as intangible assets.
Following the publication of the IFRS Interpretations Committee (IFRIC) agenda decision on Configuration or Customisation Costs
in a Cloud Computing Arrangement in March 2021 and ratified by the International Accounting Standards Board (IASB) in April
2021, the Group has adopted the guidance set out in the IFRIC agenda decision, which establishes a process to identify and
recognise costs as intangible assets only if the activities create an intangible asset that the Group controls and the intangible asset
meets the recognition criteria. Costs that are not capitalised as intangible assets are expensed as incurred unless they are paid to
the supplier of the cloud-based software to significantly customise the cloud-based software in which case the cost paid upfront is
recorded as a prepayment for services and amortised over the expected term of the cloud computing arrangements.
As a result, the Group has reconsidered its accounting treatment in relation to the capitalisation of certain software implementation
costs. The Group has determined that certain software implementation costs should have been expensed when they were incurred
as no separate intangible assets controlled by the Group were created. At the time of finalising the interim financial statements,
the Group's review was still in progress due to limited time available from the IFRIC agenda decision to the reporting date. The
work already completed shows that the impact of the change will not have a material effect on the Group’s financial statements.
The Group expects to implement the updated accounting policy in the second half of the year with the full impact of the change in
accounting policy reflected in the consolidated financial statements for the year.
This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly,
this report should be read in conjunction with the annual report for the year ended 31 March 2021 and any public announcements
made by the Company during the interim reporting period.
3. Impact of Covid-19
Given the continued presence of Covid-19 a level of uncertainty remains. The risks and uncertainties faced by the Group relate to
(and are not limited to):
 The impact of wider global economic pressures and shift in market dynamics
 A potential outbreak at one of the Group’s production facilities, significantly affecting site access, production and sales
 Supply chain disruptions
Management continuously monitors these risks and plans accordingly to reduce the impact of these on the Group.

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ASB Bank
At 30 September 2020 the Company had an overall facility of $11.2m (overdraft balance: $3.8m) and at 31 March 2021 $10.0m
(overdraft balance: $3.6m). The facility was ended upon receipt of the Tanarra debt facility.
State Bank of India (SBI)
Rakon India has a facility with SBI including ₹150m (NZ$2.9m) that can be used for cash based working capital requirements,
unchanged from prior periods. The current overdraft balance is $0.04m (September 2020: $2.0m, March 2021: $0.05m).
8. Capital commitments
The Group has committed to construct a new purpose-built manufacturing facility in the Bengaluru Special Economic Zone, India
to house the current Indian operations. The Group has purchased the building site and is in the process of finalising the detailed
designs and costings.
9. Contingencies
In September 2021 the outstanding 2011/12 income tax dispute was resolved in favour of Rakon India. There are no other changes
to material contingent liabilities or assets from 31 March 2021.
10. Subsequent events
There were no material events subsequent post 30 September 2021.

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Directory
Registered Office
Rakon Limited
8 Sylvia Park Road
Mt Wellington
Auckland 1060
New Zealand
Telephone: +64 9 573 5554
www.rakon.com
Mailing Address
Rakon Limited
Private Bag 99943
Newmarket
Auckland 1149
New Zealand
Directors
Bruce Irvine
Keith Oliver
Brent Robinson
Yin Tang Tseng
Lorraine Witten
Keith Watson
Steven Tucker
Principal Lawyers
Bell Gully
PO Box 4199
Shortland Street
Auckland 1140
New Zealand
Auditors
PricewaterhouseCoopers
Private Bag 92162
Auckland 1142
New Zealand
Share Registrar
Computershare Investor Services Limited
Private Bag 92119
Victoria Street West
Auckland 1142
New Zealand

Managing Your Shareholding Online:
To change your address, update your payment instructions
or view your investment portfolio, including transactions, please visit:
www.investorcentre.com/nz

General enquiries can be directed to:
enquiry@computershare.co.nz
Telephone: +64 9 488 8777
Bankers
ASB Bank
PO Box 35
Shortland Street
Auckland 1140
New Zealand

www.rakon.com

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Rakon Limited
T +64 9 573 5554
8 Sylvia Park Road, Mt Wellington, Auckland 1060, New Zealand
Private Bag 99943, Newmarket, Auckland 1149, New Zealand
Page 1 of 3 w w w . r a k o n . c o m

25 November 2021

UNAUDITED RESULTS FOR THE HALF YEAR TO 30 SEPTEMBER 2021
Rakon delivers record half-year earnings
Highlights:
 Revenue $85.4m (1H21: $59.5m) 
 Underlying EBITDA
1
more than doubles
2
to $26.4m (1H21: $11.4m) 
 Net profit after tax $18.9m (1H21: $4.6m)
 Sustained core market growth, particularly 5G, data centres and industrial positioning
 Significant new opportunities from worldwide chip shortage captured 
 Record manufacturing output from NZ operation
 Recent guidance upgrade confirmed for FY2022 Underlying EBITDA range of $44–49m
All amounts are in New Zealand Dollars
Rakon (NZX.RAK) today announced significant improvements in revenue and earnings for the six-month period to 30
September 2021 as it continues to benefit from strong global demand growth for its industry-leading frequency
control and timing solutions.
Revenue for the half year rose 43% to $85.4m (1H21: $59.5m). Gross margin improvements and disciplined
management of supply risk drove a 132% increase in Underlying EBITDA to $26.4m (1H21: $11.4m). Net profit after
tax increased 308% to $18.9m (1H21: $4.6m).
Chair Bruce Irvine said Rakon’s success over the period was the result of the company’s ability to secure and deliver
new business as a result of the TCXO
3
chip shortage, while continuing to grow its core business.
“Our 50-year track record of innovation and technology leadership, combined with longstanding relationships with
some of the world’s leading technology companies, has ensured that we remain at the forefront in developing the
next generation technologies. We have a deep understanding of our core markets and have created flexible and
scalable global operations to support our growth and capture new opportunities.”
Managing Director Brent Robinson said core business growth continued to be led by strong demand for Rakon’s
telecommunications solutions, particularly in 5G networks and data centre equipment; and increasing demand for
positioning solutions to support industrial positioning applications. Additionally, the company was able to adapt
and scale up its operations to secure new business stemming from the worldwide shortages of TCXO chips.
“Notably, this strong performance has been achieved in the face of considerable disruption to the global supply
chain and the challenges of the global pandemic. It is a testament to the team, and the resilience and flexibility
that has been embedded into the business over recent years.
“It has been a challenging half year, but we are delighted with the progress we have made and excited about the
opportunities we see emerging across our core market segments.”

1
Refer to Note 5 of the FY2021 audited consolidated financial statements for an explanation of how ‘Non-GAAP Financial Information’ is used, including a
definition of ‘Underlying EBITDA’ and reconciliation to net profit after tax
2
All comparisons are against the prior corresponding period (1H21) unless otherwise stated
3
Temperature compensated crystal oscillator

Page 2 of 3 w w w . r a k o n . c o m

Market segment performance
Telecommunications revenue grew 9% to $41.7m, generating 49% of Rakon’s total revenue for the period. Resultant
gross margin increased $2m to $18m with GM% higher also at 42% from an improved product mix. The steady
growth of this market is driven by the continued rollout of 5G networks.
Space and defence revenue increased 4% to $11.9m (14% of total revenue), with gross margins remaining relatively
consistent. Growth is currently being led by increasing momentum in the low-earth orbit (LEO) satellite business,
where Rakon is receiving funding from the European Space Agency to develop subsystems and modules for these
satellites. The defence segment continues to perform steadily.
Positioning revenue grew 108% to $12.5m (15% of total revenue), with gross margin more than doubling to $7m
due to a significantly improved mix of higher margin products. Growth in this segment has been driven by a
combination of core business and new opportunities. Rakon is now seeing the benefits of its strategic shift to
industrial applications and its focus on building strong relationships with a number of Tier 1 equipment and
machinery companies. The global TCXO chip shortage opportunities have also enabled Rakon to build new customer
relationships and develop some longer term business.
Revenue from emerging markets, IoT (Internet of Things) and other areas grew 416% to $19.3m (22% of total
revenue). This was primarily from orders for IoT devices stemming from the TCXO chip shortages, with 50% of those
orders delivered during the first half. The remaining orders are planned for delivery in the second half.
Operations
Rakon’s New Zealand operation increased its average monthly throughput by 60% against FY2021, providing a major
capacity increase to enable the fulfilment of new orders and delivering record gross margins. The company’s Indian
and French operations demonstrated exceptional resilience through a number of Covid-19 outbreaks to achieve
forecasted output.
Mr Robinson said materials supply has remained extremely tight, resulting in extended lead times, price increases
and continued market consolidation.
“Capacity constraints, allocations and rising prices from suppliers have become the norm and we have worked
extremely hard to overcome uncertainties around manufacturing capacity and the procurement of materials and
parts. We have been fortunate to receive support from suppliers and key Tier 1 customers to secure the supply of
materials in order to meet deliveries.”

Innovation
The company invested $6.5m in research and development during the period, which was highlighted by the
successful design-in and adoption of new products for new 5G millimetre wave radio heads and small cells (using
major semiconductor reference designs).
Rakon also celebrated a milestone in commencing delivery of the new TCXO products designed specifically in
response to global chip shortages. “The entire process from design to manufacture was completed in just three
months and we have been delighted with the outcomes achieved from these efforts,” said Mr Robinson.
Balance sheet
The company remains in a strong financial position with total assets increasing to $177m, and the lift in earnings
contributing to an 18% increase in equity since March 2021. At balance date Rakon remains in a $3.6m net cash
position, slightly lower than the $5.0m recorded on 31 March 2021 (FY2021). Operating cash flow was $4.5m,
down 43% from the prior year as the company increased its working capital to support its rapid growth and to help
mitigate against supply chain risks.

Page 3 of 3 w w w . r a k o n . c o m

Mr Robinson said that as Rakon further gears up to support growth opportunities, as well as managing ongoing
risk around supply chain, inflation and Covid-19, it would continue its conservative approach to managing its
balance sheet.
Directors have determined not to declare an interim dividend.
Outlook for the remainder of FY2022
Mr Robinson said orders are in place to deliver further revenue growth for the remainder of FY2022, particularly
in 5G telecommunications networks as well as the final tranche of orders due to the worldwide TCXO chip shortage.
“Accordingly, we expect Rakon to continue to perform well, provided we are able to continue to manage the
significant challenges related to the pandemic and ongoing challenges in securing raw materials and parts to meet
orders.
“We remain confident of achieving our recently upgraded earnings guidance, with expected Underlying EBITDA in
the range of $44–49m for the year to 31 March 2022.”
-Ends-

Contact:

Investors Media
Brent Robinson Richard Inder
Managing Director The Project
+64 21 722 707 + 64 21 645 643

Anand Rambhai
Chief Financial Officer
+64 21 542 287
www.rakon.com

About Rakon
Rakon is a global high technology company and a world leader in its field. The company designs and manufactures
advanced frequency control and timing solutions. Its three core markets are Telecommunications, Positioning and
Space and Defence. Rakon products are found at the forefront of communications where speed and reliability are
paramount. The company’s products create extremely accurate electric signals which are used to generate radio
waves and synchronise time in the most demanding communication applications. Rakon has three manufacturing
plants, and has six research and development centres. Customer support personnel are located in sixteen offices
worldwide. Rakon is proud of its New Zealand heritage; it was founded in Auckland in 1967. It is a public company
listed on the New Zealand stock exchange, NZX, ticker code RAK.

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0
Enabling the connected future
1H22 financial results & business update
Six months to 30 September 2021
25 November 2021 © Rakon Limited

1
Brent Robinson
Anand Rambhai
Key highlights and achievements
Strategyupdate
Operating performance & market update
Financialoverview
Summary &outlook
Q&A
1
Agenda
Brent Robinson (CEO, Managing Director)
Brent Robinson
Brent Robinson
Anand Rambhai(CFO)
Brent Robinson

2
1H22 –key highlights & achievements
2
2
1H22 –key highlights & achievements

3
$11m
$12m
$11m
$15m
$23m
$26m
FY18FY19FY20FY211H22
EBITDA
1H2H
Financial results –highlights
Notes:
All figures are presented in New Zealand dollars unless otherwise indicated
All comparisons are to the prior corresponding period (i.e. six months to 30 September 2020) unless otherwise noted
1
Refer to note 5 of the FY2021 audited consolidated financial statements for an explanation of how ‘Non-GAAP Financial Information’ is used, including a definition of ‘Underlying EBITDA’ and reconciliation
to NPAT
3
$60m
$101m
$114m
$119m
$128m
$85m
FY18FY19FY20FY211H22
Revenue
1H2H
v March 2021
Strong performance driven by increased revenue and margins
Revenue
$85.4m
$25.9m +43%
Net profit after tax
$18.9m
$14.3m +308%
Operating cash flow
$4.5m
$3.4m -43%
Net cash/(debt)
$3.6m
Underlying EBITDA
1
$26.4m
$15m +132%
$1.4m -29%

4
1H22 achievements
Successful delivery against ongoing demand growth
•Significant revenue lift driven by continued growth in core
markets and new business stemming from global TCXO shortages
•Accelerating 5G network rollouts driving strong demand for
Rakon’smarket-leading products
•Successful navigation through significant supply chain challenges
•Record performance out of New Zealand operation
•Key milestones achieved in the development of next-generation
products and technologies
4
4

5
Strategy update
5
5

6
6
6
How we create value
We drive the advancement of precision timing and frequency control solutions in our core markets,
and ensure long product lifecycles through operational excellence and enduring customer relationships

Hi-Reliability
Industrial
Consumer
FY2021
USD $650M
Price
/
Performance
Level
Quantity / Volume
Rakon share
Consumer
Industrial
Hi-Reliability
FY2026
USD $1,150M
Our opportunity
Growing our share in high-growth markets
7
7
Positioning
Telecommunications
Space & Defence
“We play in the parts of the market where
solutions are needed for the most challenging
specifications and environments”
Serviceable Addressable Market

8
Operating performance and market update
8
8

Customer partnerships
9
9
Long term relationships with industry leaders
Core market players
Overview
•Approved supplier to majority of Tier 1 companies in all core markets
•10–30 year relationships with major customers, international agencies and
industry standards organisations key to development of industry-leading
technologies
oTier 1 customer partnerships to develop next generation products incl. 5G radio heads
oMember of International Telecommunication Union (ITU) standards advisory board
oEuropean Space Agency (ESA) funding on multiple programmes
1H22 achievements
•Strong support from Tier 1 customers through supply chain shortages
•Reference design partnership with leading semiconductor player enabled the
release of new ultra-low phase noise TCXO and VCXO products
6–18 month focus
•Reduced customer supply risk through dual sourcing/dual manufacturing
strategy
•Management of pricing expectations as costs increase
•Continued work with customers to identify next generation technology needs
and capture new design-in opportunities

10
10
Overview
•Portfolio of patented products and technologies provides a competitive moat
that protects against commoditisation
•Product performance advantage and replication difficulty ensures long lifecycles
and revenue streams
1H22 achievements
•Substantial uptake of new 5G millimetre wave radio heads and small cells using
major semiconductor reference designs
•Design-in and adoption of new miniature Mercury OCXO by multiple Tier 1
customers
•Rapid development and launch of new TCXO ASIC
1
-based products (in response
to global chip shortage)
6–18 month focus
•Launch of multiple XMEMS
®
-based product families
•Release of latest proprietary chip ‘Niku’ for next generation TCXO ASIC products
•Development of multiple NewSpacesubsystem modules (ESA partnership)
Technology innovation
Continuing to raise the bar with ever-smaller form factors
1
ASIC –Application Specific Integrated Circuit
$6.6m
$9.7m
$11.0m
$12.8m
$13.6m
$6.5m
FY18FY19FY20FY211H22
Research & Development expenditure
H1H2

11
11
Core markets
Telecommunications –5G drives growth momentum
Overview
•High performance products which allow ever-increasing speed and more reliable
connectivity –key benefits of 5G
•Critical components in telecommunications and cloud computing infrastructure
equipment
•49% of 1H22 revenue
1H22 achievements
•Revenue 9% higher driven by Tier 1 customers and 5G rollout growth
•Gross margin % increased to 42% from improved product mix
•Major design-in wins with two new Tier 1 data centre equipment suppliers
6–18 month focus
•Support significantly higher order levels (currently extendingout 12–18 months)
through increased delivery capacity and supply chain risk management
•Meet 5G market demand as network deployments continue to gather momentum
(5G base stations, distribution units and radio heads)
•Intensified data centre design-in opportunities for new OCXO and TCXO products as
data centres tool up to become communication service providers for mobile operators
$38m
$42m
$40m
$54m
$65m
$77m
FY18FY19FY20FY211H22
Revenue
1H2H
$16m
$18m
$14m
$20m
$26m
$31m
34%
38%
40%
40%
42%
FY18FY19FY20FY211H22
Gross margin
1H2HGM%

12
12
Overview
•Products which meet the most extreme environmental challenges and most
demanding performance expectations in applications such as satellites, ground
stations, radar, aviation, communications and positioning systems
•Established relationships with government agencies and commercial
programmes around the world
•14% of 1H22 revenue
1H22 achievements
•Revenue 4% higher driven by growth in low earth orbit (LEO) satellites
•Gross margin $ steady with GM% down slightly due to changed product mix
•Defence segment remains steady
6–18 month focus
•Medium-term growth opportunities in emerging NewSpacesegment:
oIncrease Rakon components into LEO satellites
oDevelopment of higher value/margin subsystems and modules
•Maintaining current defence revenue levels through US budget cutbacks
Core markets
Space & Defence–emerging LEO satellite growth
$11m
$12m
$28m
$32m
$28m
$30m
FY18FY19FY20FY211H22
Revenue
1H2H
$7.7m
$8.0m
$19m
$22m
$19m
$20m
68%
69%
69%
68%
67%
FY18FY19FY20FY211H22
Gross margin
1H2HGM%

13
13
Overview
•Products which focus on the most accurate positioning requirements (aircraft/marine
navigation, emergency beacons, automotive, autonomous agriculture & mining)
•Pivot away from historic consumer product focus to high value industrial positioning
markets has resulted in lower revenues but improved GM%
•15% of 1H22 revenue
1H22 achievements
•Revenue 108% higher driven by industrial applications and global TCXO chip
shortages
•Gross margin $4m higher and GM% also up from improved product mix
6–18 month focus
•Retention of strategic new business in automotive, safety, tracking and industrial
applications
•Increasing new business opportunities in Advanced Driver Assistance Systems (ADAS)
and V2X infrastructure to support future autonomous vehicles
•Further develop low-cost manufacturing partnerships to extend higher-volume
product lifecycles
Core markets
Positioning –industrial and consumer growth captured and delivered
$3m
$11m
$8m
$7m
$7m
$7m
42%
40%
36%
48%
55%
FY18FY19FY20FY211H22
Gross margin
1H2HGM%
$6m
$13m
$26m
$20m
$19m
$14m
FY18FY19FY20FY211H22
Revenue
1H2H

14
14
Overview
•Emerging industrial applications such as wireless control, test and
measurement, Internet of Things (IoT), Machine-to-Machine, smart grids and
metering
•22% of Rakon’s 1H22 revenue
1H22 achievements
•Revenue 416% higher resulting from orders due to global TCXO chip
shortages (application: IoT devices)
•Gross margin $10m higher from increased revenue and gross margin %
increases to 58% from improved product mix
6–18 month focus
•Second half delivery of remaining TCXO orders
•Pursue ongoing multi-source customer requirements
Core markets
$19m
$7m
$8m
$7m
$7m
$19m
FY18FY19FY20FY211H22
1H2H
($0m)
$1m
($0m)
$1m
$11m
-6%
16%
-5%
15%
59%
FY18FY19FY20FY211H22
Gross margin
1H2HGM%
$7m
$8m
$7m
$7m
$19m
FY18FY19FY20FY211H22
Revenue
1H2H
IoT, emerging & other –worldwide chip shortage opportunity captured

Overview
•Continued growth in demand driving capacity expansion
•Strong risk management focus with tight material supply, capacity constraints,
allocations, and rising prices from suppliers
1H22 achievements
•Successful navigation of numerous supply chain issues through multiple initiatives
•NZ operation output 60% higher, delivering record gross margins and major capacity
increase for Rakon ASIC based TCXOs & OCXOs
•India and France operations meeting targets, demonstrating resilience through
Covid-19
6–18 month focus
•Continued focus on supply chain risk mitigation, with a constrained raw material
supply environment expected to continue through FY22, easing during FY23
•Continue to increase capacity in India and NZ to meet increasing demand
•Commencement of construction of new high-tech manufacturing facility in India
•MinimiseCovid-19 related risks at all manufacturing sites
Flexible scalable operations
Robust performance delivering scale, mitigating risk and improving resilience
15
15

16
Financial overview
16
16

27.1m
43.3m
51.7m
52.0m
58.9m
43.7m
43%
45%
44%
46%
51%
FY18FY19FY20FY211H22
Gross margin
1H2Hcore businessTCXO chip shortageGM%
59.5m
101.1m
114.0m
119.0m
128.3m
85.4m
FY18FY19FY20FY211H22
Revenue
1H2Hcore businessTCXO chip shortage
Financial performance
Demand driven by strong underlying growth and global chip shortages
17
17

Increase innetprofitcompared to
comparative period explained
Net profit & Underlying EBITDA explained
18
18
How the current periods net profit
translates to EBITDA
Other
1
–includes movement in other operating income, other (losses)/gains –net and income tax expense
Timemakershare
2
–Rakon’sshare of Timemaker’sinterest, tax and depreciation

How net profit translates to cash
19
19
Other
1
–includes unrealised foreign exchange, finance costs –net and Timemakerprofit
How netprofittranslates to operating cash
How operating cash translates
to movement in net cash
Investment in working capital to support growth

Six month performance1H221H21variance% change
Revenue85.459.5+25.9+43%
Gross profit43.527.1+16.4+60%
Gross margin %50.9%45.5%+5.4 ppts
Operatingexpenses24.624.5+0.2+1%
Other operating income0.62.4-1.8-75%
Netprofit after tax18.94.6+14.3+308%
Underlying EBITDA
1
26.411.4+15.0+132%
Capital expenditure4.41.9+2.5+129%
Operating cash flow4.57.9-3.4-43%
Balance sheet movements
since March 2021
Sep-21Mar-21variance% change
Net cash / (netdebt)
2
3.65.0-1.4-29%
Inventory43.637.7+5.9+16%
Notes
All comparisons are to the prior corresponding period (i.e. six months to 30 September 2020) unless otherwise noted
1
Referto Note5oftheFY2021auditedconsolidatedfinancialstatementsforanexplanationofhow‘Non-GAAPFinancial Information’is
used,includinga definitionof‘Underlying EBITDA’and reconciliationtonetprofitaftertax
2
excluding NZ IFRS 16
Financial performance
20

Governance & risk
Focus on strategic direction
•ESG framework further developed to better demonstrate sustainability ofbusiness
through reporting on environmental, social and governance initiatives and risks
•Investor perception study undertaken to enhance engagement and communication
with stakeholders
•Review and refresh of dividend policy including the criteria for making distribution
decisions
•Close monitoringof Covid-19 risks to protecthealth and safety of staff and
maintain operations
•Board remuneration review and succession planning actioned:
oIncrease indirectors' fees to attract and retain necessary skills andexperience
oAppointment of independent Director Steve Tucker, effective 1 October2021
•Foreign currency risk, hedging policy and hedging levels in place
21
21

22
Outlook
22
22
Outlook
22
22
Summary & outlook
22
22

Very strong 1H22 performance
•Significant market opportunity created by TCXO chip shortage, has been captured
•Continued underlying growth in core Telecommunications and Positioning markets
•Strong supplier and customer partnerships helped address some supply chain issues
Second half outlook
•Continued 2H revenue growth in underlying business (5G, NewSpace)
•Fulfilment of orders resulting from global TCXO shortages
•Delivery risks remain with ongoing supply chain volatility
Second half focus
•Release of new cutting-edge TCXO and OCXO platforms and products
•Increased manufacturing capacity and capability
•Active risk management of supply chain, Covid-19 and cost inflation
Strong financial position and funding lines in place
•Supporting growth and ensuring a buffer for adverse events
•Longer term investment focused on growth:
oNew manufacturing facility in India
oContinued development of XMEMS® capability and capacity expansion
oExpand NewSpaceproduct portfolio into higher value subsystems
23
Summary & outlook
On track for record full year, noting residual supply chain risk

24
Q&A
24
24

25
This presentation contains not only a review of operations, but also some forward looking statements
about Rakon Limited and the environment in which the company operates. Because these statements are
forward looking, Rakon Limited's actual results could differ materially
Although management and directors may indicate and believe that the assumptions underlying the
forward looking statements are reasonable, any of the assumptions could prove inaccurate or incorrect
and, therefore, there can be no assurance that the results contemplated in the forward looking
statements will be realised
Media releases, management commentary and investor presentations are all available on the company's
website and contain additional information about matters which could cause Rakon Limited's
performance to differ from any forward looking statements in this presentation. Please read this
presentation in the wider context of material previously published by Rakon Limited
Disclaimer

26
Outlook
Appendices
26

Cloud computing: Allows users to have on-demand availability of a remote
computer system’s resources for improved computing power or data
storage (usually located quite far from the user, such as in another country)
Datacentres: Usually a building that is used to hold a computer system and
other components to backup data
Design-in: An opportunity that allows Rakon’sproduct to be used as the
reference component for certain customer reference designs (a technical
blueprint of a system intended to be used by customers)
Edge computing: Allows users to have on-demand availability of a remote
computer system’s resources for improved computing power or data
storage (usually located close to the user, such as within the same city)
5G: 5th generation of the telecommunications standard, providing 10 to
1000 times better performance in many different applications
5G millimetre wave technology: The equipment that enables higher
frequency data transmission in 5G
New space/ New space LEOs: Refers to space sector commercialisation,
that are mainly low earth orbit (LEO) satellites
Mercury™ / Mercury+™: Rakon’sproprietary integrated circuit used in
OCXOs to achieve clock variations to less than 1 billionth of a second, these
enable precision timing in 5G applications
OCXO: Oven Controlled Crystal Oscillator. A crystal oscillator that uses a
miniaturised oven to keep its internal temperature constant
O-RAN: Mobile networks that are more intelligent, open, virtualised and fully
interoperable
Pluto®: Rakon’sproprietary integrated circuit used in TCXOs to achieve clock
variations to less than 100 millionth of a second; these enable higher data rates
in 5G applications
System solutions:Refers to Rakon’ssolutions that include high performance
products, equipment and consulting services for Space & Defence
TCXO: Temperature Compensated Crystal Oscillator. A crystal oscillator with
additional circuitry to remove frequency variations due to temperature change
Tier 1customers: recognised key players within their respective industries, that
make up a significant market share
VCXO: Voltage Controlled Crystal Oscillator (VCXO). A crystal oscillator with an
adjustable output frequency
XMEMS®: Crystal Micro-Electro-Mechanical System. Rakon’sadvanced quartz-
based resonator technology. It is made with Rakon’sNanoQuartz™
microfabrication process, delivering unprecedented resonator and oscillator
performances
27
27
Glossary

www.rakon.com

---

1
Shareholder update
1H22 financial results and business outlook
We are pleased to update our shareholders on a strong first half performance
for the six months to 30 September 2021.
Rakon’s growth momentum has accelerated over this period. Demand in our
core markets has continued to grow, and we have captured new business
opportunities stemming from worldwide TCXO
1
chip shortages.
Significantly, this growth was achieved during global supply chain
disruptions and Covid-related challenges. We have adapted and scaled up
our operations, worked closely with our partners and carefully managed our
risks to ensure delivery.
We acknowledge the efforts of our thousand-strong Rakon team in
achieving this performance. They have embraced the many opportunities
and challenges with enthusiasm and commitment, and kept the company
operating safely in a challenging global environment.
Financial overview
Rakon has reported an unaudited net
profit after tax of $18.9 million for the six
months to 30 September 2021. This was
308% higher than last year’s $4.6 million,
driven by strong revenue growth and gross
margin improvements.
Revenue rose 43% to $85 million, against
$59.5 million last year. In addition to the
new business opportunities driven by
worldwide chip shortages, all Rakon’s
core markets experienced underlying
revenue growth, particularly in 5G networks
(Telecommunications) and industrial
applications (Positioning).
Gross profit was $43.5 million, up $16.4
million on last year. Gross margin
percentage improved to 50.9% against
last year’s 45.5%, reflecting a shift in our
product mix in the period towards higher
margin products. Underlying EBITDA
accordingly rose 132% to $26.4 million for
the period.
Rakon’s balance sheet continues to
strengthen, with total assets increasing
to $177 million, and the lift in earnings
contributing to a 16% increase in equity
since March 2021. We have also remained
net cash-positive, with $3.6 million in
net cash at balance date.
Operating cash flow for the period was
$4.5 million, 43% below last year as the
company increased its working capital
to support its rapid growth and to help
mitigate against supply chain risks.
We will continue to maintain a conservative
balance sheet as we further prepare to
support growth opportunities, and are
cognisant of ongoing risk around global
supply chain, inflation and Covid-19.
The board has determined not to declare an
interim dividend.

Revenue
$60m
$101m
$114m
$119m
$128m
$85m
FY18FY19FY20FY211H22
Revenue
1H2H
Underlying EBITDA
$11m
$12m
$11m
$15m
$23m
$26m
FY18FY19FY20FY211H22
EBITDA
1H2H
Revenue

$85.4m
*
▲ $25.9m +43%
Underlying EBITDA
2

$26.4m
▲ $15m +132%
Net profit after tax

$18.9m
▲ $14.3m +308%
Operating cash flow
$4.5m
▼ $3.4m -43%
Net cash/(debt)

$3.6m
▼ $1.4m -29%
vs. March 2021
* All figures are presented in New Zealand
dollars unless otherwise indicated.
All comparisons are to the prior corresponding
period (i.e. six months to 30 September 2020)
unless otherwise noted.
Footnotes 1–5 are on page 5 of this document.

2
Intellectual capital
deep application
expertise and 50+ year
trusted brand

Manufacturing
Global platform and
centres of excellence
People
950+ talented and
skilled global team
Financial
Investment in R&D
and capability
Social / Ecosystem
Partnerships and
relationships
Improved

delivery for our
customers
Enabling

applications that
change the way we
live our lives
Enabling the
advancement of
technology
Increased

shareholder
value
Growth

of our people
SOLID FOUNDATIONS
A values-driven culture
Focuses on how we capture opportunities, manage risk and look after each other, our planet and future generations
Building
leadership in
high-growth,
high-tech
markets
Enabling
efficient delivery
and supporting long
product lifecycles
Enduring
relationships
and development
of market
opportunities
Creating
first-mover
advantage and
next-generation solutions
TECHNOLOGY
INNOVATION
CORE MARKETS
CUSTOMER
PARTNERSHIPS
FLEXIBLE SCALABLE
OPERATIONS
I
N
P
U
T
S
O
U
T
P
U
T
S
Reframing our strategy
In recent months we have focused on improving the way we articulate our strategy
to our stakeholders. This has included reframing our value creation model to better
reflect the priority areas (or strategic pillars) critical to the creation of long-term
value for Rakon.
Equally important are the strong foundations required for our business – our values-
driven culture; solid financial management; sound disciplines in managing risk and
Rakon’s strategy is to
drive the advancement
of precision timing
and frequency control
solutions in our core
markets, and ensure long
product lifecycles through
operational excellence
and enduring customer
relationships.
capturing new opportunities; and an enduring commitment to looking after
each other, the planet and future generations.
Reporting our progress
Progress against our strategy will, in future, be reported against each of our
strategic pillars. This will help our stakeholders to understand the progress we
are making in each area and how it will contribute to Rakon’s overall success.

3
$38m
$42m
$40m
$54m
$65m
$77m
FY18FY19FY20FY211H22
Revenue
1H2H
$19m
$7m
$8m
$7m
$7m
$19m
FY18FY19FY20FY211H22
Revenue
1H2H
Telecommunications
5G driving growth momentum
Core markets
Rakon’s telecommunications products
enable ever-increasing levels of speed
and reliability which are critical to
high-performance telecommunications
and cloud computing infrastructure
equipment.
Revenue grew 9% to $42 million,
generating 49% of Rakon’s total revenue
for the period. Higher revenue and an
improved mix of higher margin products
resulted in a 13% gross margin increase
to $18 million.
The steady growth of this market
is being driven by the continued
rollout of 5G networks. Our product
leadership means that Rakon
continues to be ‘designed-in’ to
reference designs and a preferred
supplier to Tier 1
3
network providers.
During the first half we also celebrated
two major design-in wins with new Tier 1
cloud computing customers.
Revenue
Space & Defence
Emerging LEO satellite growth
Positioning
Strategic shift gaining traction
Rakon’s space and defence products
meet the most extreme environmental
challenges and the most demanding
performance expectations for
applications such as satellites, ground
stations, radar, aviation, communications
and positioning systems.
We work with government agencies and
commercial programmes in key markets
to develop next generation solutions.
Revenue increased 4% to $12 million,
generating 14% of Rakon’s total revenue
for the period. Gross margins remained
relatively consistent.
Growth is currently being led by
increasing momentum in the low-earth
orbit (LEO) satellite business, where
Rakon is receiving funding from the
European Space Agency to develop
subsystems and modules for these
satellites. The traditional space and
defence markets have continued to
perform steadily.
Rakon’s positioning products are focused
on achieving the highest levels of precision
and accuracy in applications such as
aircraft and marine navigation; automotive
positioning; autonomous agriculture and
mining; and emergency locator beacons.
Revenue grew 108% to $13 million,
generating 15% of Rakon’s total revenue for
the period. A significantly improved mix of
higher margin products resulted in a 133%
gross margin increase to $7 million.
Positioning growth is currently being driven
by a combination of core business growth
and new business opportunities for our
positioning products, stemming from global
TCXO chip shortages. In our core business
we are now seeing the benefits of our
strategic shift to industrial applications and
our focus is on building strong relationships
with a number of Tier 1 equipment and
machinery companies.
The TCXO shortage opportunities have
enabled Rakon to build new customer
relationships and develop some longer
term business.
Revenue
Revenue
With our 50-year track record in
innovation, Rakon continues to work
with partners in cutting edge industrial
applications such as wireless control,
test and measurement, the Internet
of Things (IoT), Machine-to-Machine,
smart grids and metering.
Revenue grew 416% to $19 million,
generating 22% of Rakon’s total revenue
for the period. Gross margins also grew
accordingly, to $11 million.
This significant growth primarily arose
from orders secured as a result of the
global TCXO chip shortages for
IoT devices.
Revenue
IoT, emerging and other
Worldwide TCXO chip shortage
opportunity captured
$11m
$12m
$28m
$32m
$28m
$30m
FY18FY19FY20FY211H22
Revenue
1H2H
$11m
$12m
$28m
$32m
$28m
$30m
FY18FY19FY20FY211H22
Revenue
1H2H
$11m
$12m
$28m
$32m
$28m
$30m
FY18FY19FY20FY211H22
Revenue
1H2H
$11m
$12m
$28m
$32m
$28m
$30m
FY18FY19FY20FY211H22
Revenue
1H2H
$6m
$13m
$26m
$20m
$19m
$14m
FY18FY19FY20FY211H22
Revenue
1H2H
$7m
$8m
$7m
$7m
$19m
FY18FY19FY20FY211H22
Revenue
1H2H

4
Customer partnerships
As an approved supplier to the majority of Tier 1 companies in our core markets, Rakon
has developed long and enduring relationships with major customers, international
agencies and industry standards organisations. These partnerships are critical to our
continued advancement of industry-leading technologies.
In recent months, our primary focus has been on delivering customer orders in a
challenging supply chain environment. Through our multi-sourcing strategy and strong
relationships, we have been able to work successfully with suppliers and customers to
ensure delivery.
Product development work with customers is ongoing, and we were pleased to recently
release new ultra-low phase noise TCXO and VCXO
4
products for 5G small cells, as the
result of a reference design partnership with a leading semiconductor player.
Rakon’s active participation in industry standards organisations has also ensured
that products are being developed to meet the ever-changing needs of our markets.
A recent example is the development of grandmaster clock references necessary to
support precision timing in 5G networks.
Technology innovation
Rakon’s culture of innovation is delivering an increasing number of industry ‘firsts’,
with our portfolio of patented products and technologies providing a competitive
moat against commoditisation as well as delivering long product lifecycles and
revenue streams.
We invested $6.5 million in research and development during the half year.
A milestone was celebrated with delivery of new TCXO products developed in response
to global chip shortages. The entire process from design to manufacture was completed
in just three months – a real achievement for our team.
We were also pleased to achieve the successful design-in and adoption of two new
product lines, being 5G millimetre wave radio heads and small cells (using major
semiconductor reference designs); and the miniature Mercury OCXO
5
, which has been
adopted by multiple Tier 1 customers.
Flexible scalable operations
Our global operations strategy focuses on building manufacturing scale at three sites,
lengthening product lifecycles through low-cost manufacturing options, and mitigating
supply chain risk through multiple sourcing.
The continued improvement in the capability and resilience of our operations has
underpinned Rakon’s strong half-year performance. Our New Zealand operation
increased its average monthly throughput by 60% against FY2021, delivering record
gross margins and providing a major capacity increase to enable the fulfilment of
new orders.
Concurrently, our Indian and French operations matched forecasted revenues while
demonstrating exceptional resilience throughout Covid-19 outbreaks.
Materials supply has remained extremely tight across the world, with extended lead
times, price increases and continued market consolidation. Accordingly, capacity
constraints, allocations and rising prices from suppliers have become the norm and we
have worked extremely hard to overcome uncertainties around manufacturing capacity
and the procurement of materials and parts. We have also worked successfully with
customers to adapt design specifications in order to deliver.
Further progress has been made in the development of Rakon India’s new manufacturing
facility in Bangalore, with the purchasing of the land and the facility design in the process
of being finalised.

Summary and outlook
Rakon’s ability to adapt, scale up its operations and manage supply chain risk have
been key to this very strong first-half result. Demand for our products in our core
markets has continued to grow, and our innovation and agility has enabled us to
capitalise on new business opportunities stemming from worldwide TCXO shortages.
Our customer partnerships have also been instrumental in the successful
development and adoption of new products as well as overcoming significant supply
chain challenges during the period.

www.rakon.com
Looking ahead, we have orders in place to deliver further revenue growth in the
second half, particularly in 5G telecommunications networks as well as completing
delivery for some of the significant orders due to the worldwide chip shortage.
However, there remains significant risk in securing raw materials and parts to meet
orders, and these challenges still require management on a month-to-month basis.
Nonetheless, following a strong performance in September and October, and the
consequent narrowing of the window of risk for the remainder of the year, the
company recently announced a further upgrade in its earnings guidance for the year
to 31 March 2022. As announced, Underlying EBITDA is expected to be in the range
of $44–49 million.
We are confident that Rakon will continue to perform well through the remainder
of FY2022 provided we are able to manage the supply chain risks, maintain
our manufacturing capacity and avoid Covid-19 related disruptions at our
manufacturing sites.
5
Notes:
1
TCXO: Temperature Compensated Crystal Oscillator. A crystal oscillator with additional circuitry to remove
frequency variations due to temperature change.
2
Refer to note 5 of the FY2021 audited consolidated financial statements for an explanation of how ‘Non-
GAAP Financial Information’ is used, including a definition of ‘Underlying EBITDA’ and reconciliation to NPAT.
3
Tier 1 customers: recognised key players within their respective industries, that make up a significant
market share.
4
VCXO: Voltage Controlled Crystal Oscillator. A crystal oscillator with an adjustable output frequency.
5
OCXO: Oven Controlled Crystal Oscillator. A crystal oscillator that uses a miniaturised oven to keep its
internal temperature constant.
Over the half year, the board has primarily focused on ensuring that management
is well supported to deliver on Rakon’s strategy, including the capture of growth
opportunities and management of risk during a period of continued volatility and
uncertainty. Health, safety and wellbeing of employees remains a priority as Covid-19
outbreaks continue to flare up around the world.
Development of a reporting framework for our Environmental, Social and Governance
performance continued during the period. Rakon currently monitors and discloses a
wide range of ESG measures as part of its contractual obligations to Tier 1 customers,
and also requires the same of its own suppliers. We are committed to ensuring that the
framework that we adopt is fit for purpose across our key stakeholder groups.
Board succession planning has been ongoing. In late September, directors were
delighted to appoint and welcome Steve Tucker to the board as an independent
director, and look forward to the considerable experience and expertise Steve will bring.
Governance
Enabling the connected future