Fisher and Paykel jubilee 1:3 issue

Press, 2 June 1984, Page 24

Fisher and Paykel jubilee 1:3 issue

PA Wellington Fisher and Paykel Industries, Ltd, made a consolidated, tax-paid profit of $17.9M for the year ended March 31, compared with $16.3M the previous year, the company secretary, Mr D. H. Smith, said in his report to shareholders yesterday. A one-for-three issue of bonus shares is recommended. Extraordinary capital gains totalled $7.3M from investment sales and the net operating profit before tax was $23,102,000, compared with $19,475,000 for the previous year, Mr Smith said. Despite weak activity in the first half of the 1983-84 year, the demand for the company’s products expanded strongly in the December and March quarters, with the New Zealand economy. Half-year profits for the year ended March 31, were $9.27M and $7.04M

and for 1984 were $7.38M and $10.48M. Revenue for the 1984 year was 15 per cent higher than the previous year at $270.4M. Domestic sales were 14.4 per cent higher at $216.2M, reflecting further increases for both white ware and for National branded products. Export sales and royalty income increased 22.8 per cent to reach $36.3M, compared with $29.6M the previous year. Finance company receipts increased 9.2 per cent to $17.8M. Provision for depreciation was $7.5M ($6.4M). Interest paid on trading activities totalled SI.9M ($2.7M), while interest paid by F and P Finance, Ltd, was $7.3M ($6.3M). The group’s 44 per cent interest in Henderson and Pollard, Ltd, was sold to Carter Holt Holdings, Ltd, for an extraordinary capital gain of $7.3M. The company then acquired a 3 per cent

interest (two million shares) in Carter Holt Holdings, Ltd. Mr Smith said the directors were pleased with the progress made and results achieved by the company, considering the slow start to the year. The ratio of net profit to average shareholders’ funds at 18.1 per cent compared favourably with previous years when considered against the respective rates of inflation experienced during each of those years. The buoyant level of business during the second halfyear continued with strong demand for all products. White-ware sales under the new CER arrangement continued to expand and the company held its position in sales to export markets. Newer products and processes in the electronics field made a worthwhile contribution to group sales and profits and were expected to continue their growth, he said. Emphasis on investment in new products continued in programmes designed to increase productivity by incorporating advanced processes and technology in existing facilities.

In recognising the company’s jubilee year, the directors had declared a tax-free bonus issue of one share for every three held, fractions being disregarded. The directors had recommended a final dividend of 13c per share to be paid tax free from realised capital profits, and that the new 1:3 bonus issue shares would qualify for the final dividend. On this basis dividends totalling S6.IM for the year ended March 31, will be covered 2.9 times. Given normal trading conditions, the directors expected the dividend rate of 23 per cent on the increased capital to be maintained. The final dividend will be payable on July 19.

The directors recommended the company’s authorised capital increase from S4OM to SIOOM. The increase would facilitate further share increases beyond the present limit of 40 million, Mr Smith said. Another recommendation was that shares be split to 50c nominal units. Resolutions to effect these changes would be submitted for shareholder approval at the annual general meeting on July 18. While a tightening in demand later this financial year is expected on the domestic market, further growth is anticipated from new products and from export markets, particularly in Australia, Mr Smith said.