Ellis loss $500,000 but things are looking up

Press, 28 March 1981, Page 21

Ellis loss $500,000 but things are looking up

PA Dunedin Arthur Ellis Holdings, Ltd, •• reported another half million dollar loss in the latest half year, but the directors think the company may be emerg- ’ ing from the red. In other good news, Northern Feather International, Ltd, has converted its loan to shares. The loan of $611,000, at 10.375 per cent interest, was made last June with an eye to conversion into shares, but as Ellis sank deeper into the red, the investment community began to doubt that the • conversion would in fact be made. As it is, the Danish company has taken up 611,000 100 c shares, plus others, which give it a holding of a little more than 25 per cent • of the 2.3 million ordinaries. • Commenting on the move, Mr Keith Tyrrell, Arthur Ellis’ chief executive, said: “Northern Feather see the investment as a reasonable price to pay for securing their position in the Austra-’ lian and New Zealand markets. “They think we have done I"

a good job here. “In fact, with their backing, we are able to take fuller advantage of the Australian market.

“We have good orders for down-filled sleeping bags and

blankets this season. Other -. products made to our specifications and bearing our label are being made at the Northern Feather factory in Singa- ’ pore.” In detail, Arthur Ellis reported an unaudited net loss for the six months to December 31 of $504,000, compared with a loss of $633,000 in the 1979 period. This takes account of export incentives worth $210,000 ($155,000). Sales totalled $5,010,481 ($5,274,790) but the mattress division was sold at the end . of last October and this had a bearing on the latest figures. “Although a continuing loss at this level is of considerable concern the amount does not include extraordi- • nary non-recurring items,” the directors say. “During the latter part of the financial year the directors expect an improvement in trading results with the benefits of rationalisation becoming more evident,” the announcement says. “Trading conditions continue to be difficult, but

looking forward to 1981-82, management are predicting significant improvements in results, reflecting the benefits of reduced overheads, balanced stocks, reduced borrowings, and a dedicated and fully-motivated staff.

“The board is keenly aware that they are unable to give shareholders a return for their investment by way of dividend at this time, but based on projections, and with the support of Northern Feather, they now look forward to the future with greater confidence than at any time in the past two years.”