Von Kohorn Short Of Cash, Sales

Press, Volume CIV, Issue 30911, 18 November 1965, Page 21

Von Kohorn Short Of Cash, Sales

(New Zealand Press Association) WELLINGTON, November 17. .Von Kohorn of New Zealand, established in 1963 to manufacture nylon filament and yarn at Shannon, was going through “a most difficult period,” one which had “struck as suddenly as a bolt of lightning,” the chairman Mr F. H. Renouf) told shareholders ,at the annual meeting yesterday.

It had come within five months of pressing the button of the new plant at Shannon, said Mr Renouf. “It has become apparent that we are not making the sales—and there is not one of you who will not realise what happens if you make and do not sell,” shareholders were told. “If nothing else happens, you run out of money, and if nothing else is apparent in New Zealand at the moment in relation to money, there is one thing that is. Help Not Expected “When a country is in a credit ‘squeeze’ we cannot expect any help from banks, whose policy is totally against lending money for our type of operation. “I don’t think this problem is enough to break us, but I do suggest that if it arises it could, and that is how serious this message is to this company at the moment. “Our problem is not one that the product is not right. It is the problem of cash,” he said. Mr Renouf said that his company felt it had the position fully covered because of its sponsorship with one of the top 500 United States companies. However, one of their other subsidiaries lost many millions of dollars and they were unable to assist. “Therefore this present position should not have arisen and we should not have been too worried about the slow sales penetration. Sales Penetration “Worse than that, it has forced us into a situation which has set your directors really to task but we will manage. The problem of sales penetration remains,” he said. “We have a redoubtable competitor in Fibremakers. They are so redoubtable that

Iwe are the David against Goliath. ‘•None of you is in any doubt that our company is in a difficult position. I want to assure shareholders now that we will beat it and have sufficient indication of'the shortterm action which means additional resources.” The company was seeking a major partner to try to overcome the problem—a world i producer of nylon such as 1.C.1. with Fibremakers. Von Kohorn was floated in 1963 with one of the greatest flurries of public interest seen in any company floatation in this country. Over-subscribed The public were offered I.Bm ordinary 5s shares and the issue was hopelessly oversubscribed. The second annual accounts, released recently, showed that in the period from September 1, 1964, to June 30, 1965, the company incurred a deficit of £74,655. In his report with the accounts, Mr Renouf stated that recent market surveys confirmed that the demand for the company’s products was extensive and potential selling prices showed no indication of being other than in accord with previous estimates.

V. Kohorn Now Enzlon Von Kohorn of New Zealand has now changed its name to Enzlon Chemical Fibres Ltd. This change was approved at a special meeting on Tuesday.