Alex Harvey sales slow

Press, 16 May 1978, Page 20

Alex Harvey sales slow

. Sales of products from all i of the groups of Alex Harvey . Industrie., Ltd, for the first ' six months to September 30 were significantly ahead of . the previous year’s figures ’ but an increasing slowdown .in demand, particularly in the building industry, rej suited in sales for the ' year to March 31 being only , 7 per cent ahead of last year’s total of $206,134,000, say the directors in a preliminary report. During the year new-house completions fell by an estimated 25 per cent and although such a substantial fall in the domestic market was not able to be recouped in increased export markets this year, total export sales increased by nearly 30 per cent to more than S23M. A feature of this year’s export drive has been the successful penetration of new markets in the United States, Europe, and other areas, including the Gulf states.

With the benefit of the tax incentives associated with this increase in export sales and the tax saving arising from the opening

stock adjustment, the ompany has been able to maintain last year’s level of profit against a general background of rising costs and reduced levels of demand in New Zealand.

Taxation provided for the vear was $4,316,000 compared with the previous year’s provision of $6,839,000 and depreciation of $5,383,000 has been provided compared with $4,699,000 last year. On shareholders’ funds now totalling $98,284,000, this year’s earning rate has dropped to 14.6 per cent which approximates the annual rate of inflation.

As expected, because of the number of big projects either under way or planned at the end of last year, there has been a substantial increase in capital expenditure this year to more than SI6M.

The company has been able to finance part of this increased capital spending by continuing emphasis on the control of investment in working capital. As announced, group net. profit rose a marginal 1.5 per cent to $14.3M.