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


Rubicon returns to profit as Tenon rides US housing rebound

Rubicon returns to profit as Tenon rides US housing rebound, ArborGen rejigs R&D

Aug. 29 (BusinessDesk) - Rubicon, the forestry biotech company spun out of Fletcher Challenge, returned to profit on an earnings before interest, tax, depreciation and amortisation basis after its Tenon unit rode the coat-tails of a resurgent US housing market, and its ArborGen joint venture refocused its research and development programme.

The Auckland-based company reported EBITDA of US$3 million in the 12 months ended June 30, from an EBITDA loss of $5 million a year earlier, it said in a statement. The net loss narrowed to US$6 million from US$12 million in the 2012 financial year, and the company is targeting a return to the black in 2014 provided its Tenon subsidiary meets a forecast doubling of earnings.

Rubicon holds a controlling 59 percent stake in wood mouldings maker Tenon and a 32 percent share of US-based seedlings biotech firm ArborGen.

The company’s turnaround was largely due to Tenon’s return to an EBITDA profit as the US housing market starts to recover from the sub-prime mortgage collapse in 2007 and 2008, which helped feed the global financial crisis.

Rubicon said Tenon is on the hunt for acquisitions, and is focusing on North America, where it seeks to build on its existing operations.

Meantime, ArborGen lifted sales of its seedlings and has scaled back some R&D discovery projects to reduce spending on pure science and accelerate near-term operational and commercial projects. Rubicon anticipates the restructuring will underpin gains in sales and earnings.

Rubicon said it still plans to float ArborGen after an aborted initial public offer in 2011, though it has to weigh up the realisation of immediate value against what it could get in the future.

“While we believe the business is ‘ready’ today, we are determined to choose the optimal equity market conditions to execute an IPO of the company,” Rubicon said. “Shareholders can be assured that this decision remains at the very top of our agenda.

Rubicon’s shares fell 2.9 percent to 34 cents today, and have gained 21 percent this year. Shares in Tenon dropped 6.4 percent to $1.31, and have jumped 69 percent this year.


© Scoop Media

Business Headlines | Sci-Tech Headlines


All District Health Boards: Historic Pay Equity Settlement

An historic agreement has been ratified that addresses a long-standing undervaluation of a workforce that is critical to the smooth running of our hospitals and the delivery of healthcare... More>>

MPI: Dry Autumn In Waikato And South Auckland Leads To Drought Classification Drought conditions affecting the primary sector in the Waikato and South Auckland were today classified as a medium-scale adverse event, enabling a package of support for farmers and growers... More>>

Commerce Commission: Invites Feedback On Its Initial Views Of Wellington Airport’s Pricing Decisions

The Commerce Commission is inviting feedback on its initial views, released today, about Wellington Airport’s pricing decisions for specified airport services, such as aircraft parking or airfield and passenger terminal charges, for the period 1 April 2019 to 31 March 2024... More>>

Barfoot & Thompson: Rents Up By Around 3% In Most Areas

The average weekly rent paid for homes in most areas of Auckland has risen by around 3 percent year-on-year. The figures for end March from more than 16,000 properties... More>>

DoC: Smeagol The ‘Gravel Maggot’ Leaves Its Rare Mark On The Remote West Coast
An extremely rare species of sea slug or ‘gravel maggot’ has been detected for the first time on a remote beach in South Westland... More>>

Immigration: Annual Net Migration Loss Of 7,300

The provisional net loss of 7,300 people in the year ended March 2022 was the lowest net migration for a March year since 2012, Stats NZ said today... More>>