Australia cuts into Mainzeal profit

Press, 28 October 1982, Page 24

Australia cuts into Mainzeal profit

The ' audited ' group net profit of Mainzeal Corporation. Ltd, including share of results of associated companies and after extraordinary items, was halved in the year ended June 30, because of depressed results in Australia and the writing off of goodwill on acquisition. The directors said in a preliminary report that the net profit before extraordinary items fell from $820,471 to $728,171, achieved on turnover of $78.5 million

— more than double last year's turnover of $39.1 million. The directors said that New Zealand activities were satisfactory, with turnover of $56,572,528 (1981, $39,050,998) contributing pre-tax trading profits of $1,871,664 ($1,425,585). The accounts include for the first time the results of the Triden Group of companies of Sydney, which became a subsidiary on July 1. Extraordinary losses have

been provided against the profit of $728,171 to the extent of $324,926 ($2OOO profit), to reduce group net profit for the year after equity accounting and extraordinary items to $403,245 ($822,471). The extraordinary items reflect the group policy of writing off all goodwill which arises on consolidation $475,402 (nil) — against which has been offset a profit of $150,476 on sale of shares and land in a subsidiary company. The provision for taxation was $303,374 (1981, $567,893). Mainzeal, which already owned 50 per cent of the Triden Group before July 1, 1981, acquired the balance of the share capital in order to protect that interest, and minimise future loss potential. Initial losses acquired in the acquisition, and some restructuring costs have all been written off, and the Triden Group is currently trading profitably, tha directors said.

Referring to the outlook, the directors said that the results for the 1982 year were 'depressed by the results in Australia and the write-off of goodwill on acquisition, but were otherwise considered satisfactory. Current indications are that the construction industry in both New Zealand and Australia is facing difficult times