N.Z. Forest sees gains

Press, 12 July 1979, Page 18

N.Z. Forest sees gains

PA ' Auckland. ■ NZ Forest Products, Ltd, i expects to increase its profi- . table export business in the , next 12 months and obtain improved results from its new subsiary company, the i chairman (Mr A. G. Wilson) says in his annual review. As announced, the group’s net profit rose $2,556,000, or I 12.6 per cent to $22,888,000 in the year to March 31, but ! this did not reflect the improved results of New Zea- : land Particle Board, and Nissan Datsun. The group had the benefit 1 of' increased markets and prices. But a concentrated

effort to improve output and productivity and reduce costs, also helped.

N.Z.F.P. has a 28.5 per cent interest in Nissan Datsun Holdings, which was adversely affected in the early part of the ’year by a big decline in demand. Since then sales had improved, but a small loss was recorded for the year to March 31. Progress was made during the latte- part of the year in securing more local and overseas sales at acceptable prices for the higher output of the Kinleith pulp and paper mills and Whakatane board mills.

A better balance of supply and demand in overseas pulp and paper markets was leading to higher prices, which were improving profitability on overseas sales.

Log and timber sales to Japan were being made at higher prices applying from

April 1. but the quantity of sales was not increasing. There were no other significant markets overseas for logs and chips.

A new plant will be installed at Kinleith to produce bark adhesive and other products from pine bark.

The start-up of the mineral fibre plant, planned for 1978. was delayed until January 1979. The total torest land holding at March 31 was 6099 ha higher at 191,957 ha. In the pre election period demand for building . products, especially for home improvements, increased. An increased output of wallboards, and timber, was sold and sales by the builders’ supplies subsidiary companies rose.

Higher farm income also appeared to be helping timber sales.

Export sales of plywgpd rose during the year, but the high freight cost of overseas sales made it more profitable to sell locally. ,•

The local demand for K»nleith and Mataura packaging printing and stationery papers improved, parttoularly during the second half year.

B. J. Ball (NZ) Ltd. pager merchant, traded satisfactorily and made an increased contribution to group profij. Sales of Ace Bag Co rubbish bags were reduced ’J>y competition from low-prided plastic bags, but improved productivity resulted in t a higher profit for this two thirds-owned company. **

In the seven months since the Marley Company Ltd. became a subsidiary. ’.a trading loss has been Iticurred, but better results ire expected.