Wattie profit 32% higher

Press, 17 April 1980, Page 18

Wattie profit 32% higher

Wattie Industries, Ltd, in-i creased net profit, on an I equity-accounted basis, 32 i per cent to $9.6M in the six months to January 31. i The profit was achieved’ on sales 22.2 per cent higher ; at SI9IM. The company will pay an interim dividend of 8 per, cent, 4c a share, compared; with 3.75 c last year. Total group exports forj the half-year were $13.6M, ! c.i.f., compared with SB.3M for the comparable period 1 last year — an increase of: 63.5 per cent. Some significant advances have been made in developing new areas of trade, particularly in processed ■ foodstuffs and cereal milling! products, and it is con- ! fidentally expected by the directors that exports fori the full year will be above) the 519.0M,' recorded in) 1978-79.

i Generally, all sections of ;the group traded satisfactorily, and contributed to the increase in sales. Associated i companies also produced ,good trading figures ■ and, by some additional I investments during the period, increased their turnover by 58 per cent. ■ Earnings per ordinary jshare rose from 12.2 c for ithe half-year to 13.4 c. Traditional seasonal patterns suggest that this latter figure ■might not be matched in the second half-year, but the board is confident of a satisfactory result for the full year. Watties share of associated company earnings ■ would have been considerably better than the $679,000 ($902,000) had it I not been necessary to provide for a $687,000 trading I loss for the Australian com-

pany, Wattie Pict. Ltd, incurred to October 31, 1979. As has been reported as from early March this year, this company has ceased trading under a joint-venture arrangement with Amatil, Ltd, after the sale of a substantial part of its assets to Henry Jones (IXL), Ltd.

The final realisation of Wattie’s investment in Wattie Pict is still dependent on the sale of two remaining factors' properties, and some other assets, the report says.

In the six months total assets have' risen $15.7M, and this was comfortably j financed from existing resources.

More than $4.2M of loans denominated in overseas currencies have been repaid with assistance from New Zealand loan placements totalling $3,342,000. Overseas currency ex-

posure is now therefore, only SUS IM, which, for repayment of principal, is covered by a forward-exchange contract.

At January 31 the group was holding more than S9M in short-term realisable investments, but as business expands in the present inflationary climate, it will be necessary to strengthen financial resources with further borrowings. The board proposes to continue its programme of improving the efficiency and competitiveness of the group’s established activities, making acquisitions and investments as may be appropriate to further this objective. A second premium issue of 756,800 ordinary shares has been taken up by eligible staff under the group’s staff-share scheme during the period under review.