Skellerup reports record profit, increases dividend
By Pam Graham
Aug. 23 (BusinessDesk) - Skellerup Holdings, New Zealand's largest industrial rubber products supplier, reported another record annual profit and increased its dividend as new products and low debt levels shielded it from an economic downturn in some markets.
The net profit rose 22 percent to $24.7 million in the year ended June 30, from $20.2 million a year earlier, which was also a record. Profit was at the top end of guidance of between $22 million and $24 million provided in February.
The profit included a $400,000 insurance benefit. Earnings before interest and tax rose 13.6 percent to $36.59 million.
The profit and a policy of paying between 40 percent and 60 percent of earnings to shareholders led the company to approve a 5 cents-a-share final dividend, up from 4 cents a share last year. The dividend is payable on Oct. 25. Total dividends for the year of 8 cents a share are up from 6 cents last year.
"Skellerup is in the best shape it has been in for
many years," chairman Selwyn Cushing said.
The maker of consumables for the dairy industry was experiencing increased interest from markets in China and South America.
Total revenue rose 7.1 per cent to $207.3 million.
A new version of the company's Flexiflo product used by miners had been well received by the market but sales of Deks branded roofing flashings in the Australian market had been less buoyant.
The profit of the industrial division rose 14.1 percent, while the profit of the agri-division rose 11.1 percent.
Cushing said the company was continuing to invest in organic growth opportunities and the benefits of this would be seen in the next two years.
The company is relocating a dairy manufacturing plant in Woolston in Christchurch and is using the move as an opportunity to invest in plant and equipment. The plant is moving to a new site in the Christchurch region.
The shares last traded at $1.50 and have gained 13 percent this year.