Modern Water leaks lower despite record profit

(Sharecast News) - Water monitoring systems supplier Modern Water saw its shares drip lower on Thursday despite the company recording a record first half gross profit after achieving double-digit revenue growth.For the first six months of the year the outfit's revenue increased by 22% to £1.9m compared to the same period last year, while gross profits jumped 39% to £0.9m after Modern Water's monitoring division scored "significant" 29% revenue growth from a new sales model in China.The division also achieved margin growth due to higher margin consumables and test kits making up the majority of its revenue increase.However, despite the jump in revenue and gross profit still resulted in an operating loss of £1.5m, albeit a reduction over the operating loss of £1.7m achieved in the comparable period last year.At 30 June the company had cash and cash equivalents of just £0.1m, down from £1.5m at the same point last year.Chairman Alan Wilson said: "I am pleased to report that Modern Water's strategy continues to build momentum towards its key targets - brine concentration in China and India, the Wastewater Project in Gibraltar and the monitoring division's revenue growth in China. The evidence of this is beginning to show in our first half-year results with revenue up 22% and gross profit up 39%."The project with the government of Gibraltar for a waste water treatment plant is scheduled to break ground this year.For the full-year, the company remains confident of meeting market expectations and will take advantage of the increased interest and opportunities for deployment of its technology after the success of its Indian brine concentration plant project with Advent Envirocare.Modern Water's shares were down 9.89% at 10.02p at 0938 BST.