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

 


Goodyear NZ narrows annual loss

Goodyear NZ narrows annual loss after shedding workers, exiting retailing

By Jonathan Underhill

June 11 (BusinessDesk) - Goodyear & Dunlop Tyres (NZ), the New Zealand unit of the biggest US tyre maker, narrowed its full-year loss after exiting commercial tyre and retread operations, firing workers and selling its Beaurepaires retail stores. The company's annual accounts were again tagged by its auditors.

The net loss narrowed to $1.68 million in calendar 2013, from a loss of $20 million a year earlier that included $10.4 million of restructuring costs, according to the company's annual report. Total revenue in the latest year tumbled 48 percent to $60 million.

Goodyear NZ's 2013 accounts show the company succeeded in slashing some costs as a result of restructuring. Wages and salaries dropped 65 percent to $8.5 million. Marketing expenses fell 60 percent to $1.2 million and operating lease rentals declined 46 percent to $4 million. Purchases from external parties fell 66 percent to $19 million.

"During the year, the company implemented new restructuring programs in addition to the execution of previously announced restructuring programs from prior years," the company said in notes to its accounts. "These programs include the exit of commercial tyre and retread operations, a reduction in headcount through involuntary redundancies and the exit of its company owned and licensing retail operations via a sale to an external third party."

Provisions in 2013 fell to $397,100 from $2.97 million in 2012. The company is funded through either a joint HSBC and ANZ bank facility with Goodyear & Dunlop Tyres (Australia), which is ultimately guaranteed by its US parent, or a loan from related party Goodyear Luxemburg. New York-listed Goodyear Tire & Rubber's shares have soared 83 percent in the past 12 months to recently trade at US$26.93 and are rated a 'buy' based on a Reuters analyst survey.

"Given the negative equity position, the directors have implemented various restructuring programs and believe that these measures undertaken and the access to funds noted above provide sufficient support to enable the company and group to meet its obligations as they fall due," the company said in notes to its accounts. As a result, the financial statements have been prepared on a going concern basis, it said.

The net loss for 2013 was the fourth in a row and auditors PricewaterhouseCoopers tagged the report with an 'emphasis of matter', referring to the latest loss and noting that total liabilities exceeded assets by $16.3 million as at Dec. 31. The excess of liabilities over assets and reliance on funding "indicates the existence of a material uncertainty that may cast significant doubt about the company and group's ability to continue as a going concern," the auditor says.

Last year Goodyear exited local retailing, selling 52 Beaurepaires retail stores and shifting 180 employees to Beau Ideal, owned by TyreLine Distributors’ founder Grant Rushbrooke. Beau Ideal would also take on Goodyear’s local retail marketing and licensing programmes. Goodyear sold its heavy commercial tyre service in 2012.

Larger rival Bridgestone New Zealand, the local unit of the world’s biggest tyre maker, posted a profit of $9.6 million for 2013, just down from 2012's decade high of $10.2 million, on sales of $219 million.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: Govt Resisting Pressure To Pump More Cash Into Solid Energy

Prime Minister John Key says it is “not the government’s preferred option” to make a fresh capital injection into the troubled state-owned coal miner, Solid Energy, but dodged journalists’ questions at his weekly press conference on whether that might prove necessary... More>>

ALSO:

Lagest Ever Privacy Breach Award: NZCU Baywide Accepts “Severe” Censure In Cake Case

NZCU Baywide says that once it was found to have committed a breach of a former staff member’s privacy, it had attempted to resolve the matter... the censure and remedies for its actions taken almost three years ago are “severe” but accepted, and will hopefully draw a line under the matter. More>>

ALSO:

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news