Golden Bay may soon need $20M

Press, 1 May 1980, Page 22

Golden Bay may soon need $20M

PA Wellington The Golden Bay Cement Company, Ltd, might soon have to find up to S2OM. Wilsons. N.Z. Portland, Cement, Ltd, which is 50 per cent-owned by Golden Bay, is considering spending between S3SM and . S4OM on the conversion of its works. ~ This was reveale'd at the annual meeting of Golden Bay by the chairman (Mr A. S. Paterson) who made it clear that if the 50 per cent owned company decided to go ahead with the conversion, Golden Bay would be needing a “major injection of equity.” “We now have a' fairly close assessment of the cost of converting the Wilsons plant at Portland from a wet to a dry process works. “Somewhere between S3SM and S4OM is likely to be involved. This is a very major exercise-and it-may be.' a little time yet before

we are ready to take a final decision, but two things are certain — the longer tne job is postponed the higher will be the ultimate cost, and expenditure of this magnitude would call for a major injection of equity as part of the ' overall financial ’ package,” he said. . y.:. : - . Mr Paterson said, after the meeting that the /’move would be aimed more at cost reduction rather than improving profitability. Mr. Paterson told shareholders that Golden Bay Cement itself was nearing the end of a major capital expenditure programme. The new vessel, Golden Bay, was here and working, carrying a greater cargo a voyage than the previous two vessels put together. The new harbour at Tarakohe was working and dredging would continue for sometime yet before the company could get the full benefits of the expected

draughts. Additional storac& silos had been built atWeflington and New.v-PlymouMi to accommodate the larger capacity of the ship, “Leaving aside the ‘shifi, which is leased from. Blue Circle Industries, the. total expenditure on these variol& projects will be $7.3M. : In the current financial vear, which started on January 1, cement sales marginally below those for the same months, in 197§. Even so there was evidence that -we might have pass ep the bottom of the decline, although no major upsurge was expected in the shos term, Mr Paterson said. > “In the longer term, we look ahead to the ihajffr. petro-chemical developments in Taranaki. These will riot use a large tonnage .of cement, but there will be ciated developments whicK will lift consumption from” 1983 on,” he said.