Amplifon NZ reports lower profit in 2013 amid restructure
By Pam Graham
July 1 (BusinessDesk) – Amplifon NZ, the country’s biggest audiology business, posted a lower profit in 2013 after restructuring its store network in the face of increased competition.
The Italian owned company reported a profit of $6 million in calendar 2013, down from $9.4 million in 2012, according to financial statements lodged with the Companies Office.
Revenue slipped to $58 million from $60 million a year earlier while cost of sales rose to $47.7 million from $28.7 million, reducing gross profit by two-thirds to $10.37 million.
In its 2013 annual report, the Italian parent Amplifon said the New Zealand business, which has about 48 percent of the market, faced stiff competition and weak demand, weighing on revenue. At the same time, profit was eroded at the local unit as it restructured its stores under a single Bay Audiology brand, closing NHC branded outlets.
The group had 86 Bay Audiology stores in 2013, compared to 77 outlets with that brand and 15 NHC brand stores in 2012.
Since then, the Italian parent said New Zealand sales fell 4.8 percent in the first quarter of this year, though the store rationalisation had helped improved earnings.
Amplifon bought Bay Audiology and NHC in 2010 for A$460 million, just a year after NHC itself bought the Bay unit from NZX-listed Abano Healthcare.
Providers of audiology services are expected to perform well as the population ages.