Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


GPG pension woes drag as Coats unit returns to profit

GPG pension woes drag as Coats unit returns to profit

By Paul McBeth

Feb. 25 (BusinessDesk) - Guinness Peat Group, the cash-rich owner of thread-making business Coats, is still muddling through arrangements for its UK pension obligations before returning capital to shareholders, while reporting its Coats unit returned to profit in 2013.

The investment company, which attracted investors including billionaire George Soros, is still in talks with the UK Pensions Regulator as to whether it will have to provide more financial support to its Coats pension schemes, and is exploring its options, chairman Rob Campbell said in a statement.

GPG has received warning notices detailing the panel’s arguments as to why it believes it would be reasonable to require more support for the schemes. If GPG can’t reach a settlement with the regulator a hearing won’t be held earlier than the second half of this year, and could drag out to the end of 2015 if an appeal is pursued.

“Any decision on the future capital structure of Coats and further cash distributions to shareholders continues to be deferred while these matters are being resolved,” Campbell said. “The board fully shares the natural frustration of shareholders about this process and its prevention of further surplus distributions to shareholders.”

As at Dec 31, GPG valued the pension scheme deficits at 178 million pounds, down from 281 million pounds a year earlier. In 2012, the agreed funding deficit with the pension schemes’ trustee was 215 million pounds.

GPG has generated about $1.4 billion from the asset sale programme it embarked on in 2011 after a shareholder revolt over plans to split up the company along regional lines saw a board shake-out. It had cash of some $773 million as at Dec. 31 from $490 million a year earlier, and shareholders’ funds of $896 million, up from $876 million at the end of 2012.

The investment company returned to profit with earnings of 23 million pounds in 2013 compared to a loss of 29 million a year earlier, as it banked gains from the liquidation of its portfolio and its Coats unit was back in black.

Coats, which GPG has previously said it plans to rebrand, lifted annual sales 3 percent to US$1.7 billion in 2013, and turned an operating profit of US$124.2 million from a loss of US$11.1 million.

The thread-maker turned a net profit of US$29.2 million, from a loss of US$146.4 million after facing a European Union fine for fixing prices in the haberdashery market. Coats generated free cash flow of US$44.8 million in the period.

GPG’s shares were unchanged at 67 cents yesterday, and have gained 14 percent this year. The stock is rated an average ‘hold’ based on six analyst recommendations compiled by Reuters, with a median price target of 62 cents.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Media: Julian Wilcox Leaves Māori TV

Māori Television has confirmed the resignation of Head of News and Production Julian Wilcox. Mr Maxwell acknowledged Mr Wilcox’s significant contribution to Māori Television since joining the organisation in 2004. More>>

ALSO:

Genetics: New Heat Tolerant Cow Developed

Hamilton, New Zealand-based Dairy Solutionz Ltd has led an expert genetics team to develop a new dairy cow breed conditioned to thrive in lower elevation tropical climates and achieve high milk production under heat stress. More>>

Fractals: Thousands More Business Cards Needed To Build Giant Sponge

New Zealand is taking part in a global event this weekend to build a Menger Sponge using 15 million business cards but local organisers say they are thousands of business cards short. More>>

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news