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

 


Methven FY profit drops 8.6% on strong currency, inventory

Methven annual profit drops 8.6% on strong currency, inventory woes

By Suze Metherell

May. 22 (BusinessDesk) - Methven reported an 8.6 percent fall in full-year profit as the tap maker and distributor struggles with retailers holding smaller inventories, and as the strength of the New Zealand dollar erodes exported earnings.

Net profit fell to $4.7 million in the year ended March 31 from $5.2 million a year earlier, the Auckland-based company said in a statement. Revenue fell 1.7 percent to $96.7 million.

Sales to Australian customers grew 5.8 percent to A$35 million, though that didn't translate to higher profits with Methven's margins squeezed by competitive pricing, the strength of the kiwi currency and increases in supply chain costs. Australian stock reduction programmes from retailers in the market continued longer-than-expected, causing it to cut full-year earnings guidance twice this year. High Australian stock levels led to a 48 percent increase in Methven's debt to $17.2 million in 2013.

The company has since reduced its debt 16 percent to $14.5 million but that's forecast to rise with the purchase of its Chinese production partner, Invention Sanitary mid this year. Methven will pay four times the manufacturer's profit for the 12 months ended June 30, 2014, up to a maximum of $8 million. The Chinese acquisition is expected to add an annual $2 million to net profit after tax from September.

New Zealand sales rose to $35.1 million from $34.9 million the previous year, slightly below its own expectations, the company said. UK earnings before interest, tax, depreciation and amortisation was $1.1 million, up from a break-even position as revenue showed "slight growth".

Methven's board declared a final dividend of 4.5 cents per share payable June 30.

Shares in the NZX listed tap maker fell 0.8 percent to $1.18 and have declined 3.3 percent in the past year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news