Quake strengthening almost halves Kirkcaldie's 1H profit

Quake strengthening almost halves Kirkcaldie's first-half profit

April 29 (BusinessDesk) – Wellington department store Kirkcaldie & Stains Ltd. said first-half profit almost halved, reflecting the disruption caused the earthquake strengthening of its Harbour City Centre building.

The listed retailer said net profit for the six months ended February 28 fell to $380,000 from $725,000 in the same six months a year earlier.

The company said retail sales and rental income were impact by the earthquake strengthening work in the last two months of the period. When completed, the project, which is on schedule and within budget, will greatly add to the property's value, it said.

Kirkcaldie's property company net profit fell 35% to $510,000 while its retail unit’s profit was just $1,000, down from $43,000 a year earlier, though retail sales fell only 5% to $18.9 million. However, sales from the concession areas of the store rose 33.5% taking the total sales decrease to 2.7%.

The company said renewed leases for its two major tenants will substantially increase rental income. Its anchor office tenant, Contact Energy, will take another floor in the building with work beginning on refurbishing the space by mid year.

The new Country Road store, due for completion and opening in November, “will greatly enhance the shopping experience at the Harbour City Centre along with the new homewares and cuisine shop that Kirkcaldies is establishing in the centre.”

Kirkcaldie will pay an unchanged, fully imputed interim dividend of 3 cents.

The company's shares last traded on April 26 at $2.55. The price of the thinly traded stock has ranged between $2.40 and $2.80 over the past 12 months.

(BusinessDesk)

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