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NZ Wool Reports a Positive Result

NZ Wool Services International – Reports a Positive Result

New Zealand’s largest wool scourer and exporter, New Zealand Wool Services International Ltd, has reported a net surplus after taxation for the year to 30 June of $3.288 million – down from the previous year’s record result of $3.604 million.

Chairman Pat Morrison said the result was in line with director’s expectations, with the drop in profit expected after last year’s record result.

“In the first half of the 2004 financial year a rapidly appreciating New Zealand dollar negatively affected trading margins. A strong contribution from scouring operations throughout the year and an improvement in trading profitability in the second half however lifted our performance to meet the expectations provided to shareholders in the half yearly report. This result although down on last year should be regarded as a satisfactory outcome given the difficulties encountered in the first six months.”

The result represents a tax paid return of 10.5 per cent per annum on average shareholders’ funds employed during the period and tax paid earnings of 4.65 cents per share. Revenues of $134.723 million were up on the previous year’s total of $131.160 million.

“The company’s confidence in the future of the industry is demonstrated by the $10 million refurbishment and upgrade of the Whakatu Wool Scour, which we own in partnership with Dalewool Holdings Ltd. When this new plant is commissioned, early next year, it will be the most modern and efficient scour in the world, matching our South Island processing operation at Kaputone, north of Christchurch.

“This will provide a much needed increase in our processing capacity in the north and ensure the production of high quality product and control as established in our South Island plant is replicated in the north,” he said.
Dividend Shareholders will receive a fully imputed dividend of 4 cents per share on 17 November the same as that paid the previous year. The record date for entitlements is 5 November 2004.
Stock Exchange Listing New Zealand Wool Services International listed on the New Zealand Stock Exchange’s NZAX market on 3 May 2004. Prior to that, the company’s shares traded on the unlisted securities market.
Outlook The company has maintained a steady growth path in recent years and with the commissioning of the new plant at Whakatu early in 2005 the company will be well placed to further its growth in years to come. The 2004/2005 year however will be affected by the disruption encountered while the new plant is commissioned and in light of this directors consider that last years profit may be difficult to improve upon.

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