MetroGlass says FY normalised net profit was $18M to $18.5M, at or below guidance
By Rebecca Howard
April 3 (BusinessDesk) - Metro Performance Glass said its full-year normalised net profit was $18 million to $18.5 million on the back of weaker-than-expected Australian performance as well as some unexpected costs related to a change in leadership.
The Auckland-based company had previously forecast profit of $18.5 million to $20 million in the year to March 31 versus the prior year's $21.3 million. Australia's performance was hurt by the "longer than anticipated disruption from the capital programme" across the Tasman, it said. "The New Zealand programme went largely to plan, however, the Australian programme proved challenging," the company said.
Australian Glass Group had to work around significant shipping disruptions delaying some key equipment beyond the planned shutdown period. This impacted its sales, costs and customer experience in December, January and February, it said.
The programme is now complete and will provide "significant capability enhancements, plant simplification and better geographic alignment of equipment to market opportunities at the Group's seven processing plants."
Metro Glass also said it had some one-time abnormal costs impacting reported net profit relating the change in the chief executive that weren't anticipated. It is forecasting reported net profit will be $16 million to $16.5 million versus a net profit of $19.4 million in the prior year. In mid-December the company said chief executive Nigel Rigby is stepping down after five years, saying "the time is right" for new leadership. An international recruitment process is underway and in the interim, the group will be lead by the senior leadership team with close support from the board, it said.
Looking ahead, chair Peter Griffiths said a strategic review announced in October 2017 is "well progressed." According to Griffiths after strong sales growth over a number of years, "we expect that activity in our core New Zealand market will remain flat and may eventually soften" while the South East Australian market continues to show strong demand. Metro Glass has the capacity for increased sales in the South East of Australian and intends to achieve "material profitable growth over there over the next 24 months," he said. In New Zealand, it will focus on becoming "more efficient and productive."
Griffiths said Metro Glass will provide more detail on the results of the reeview when it announces its full year result on May 24.
MetroGlass shares last traded down 1.4 percent at 73 cents and have dropped 26 percent so far this year.