N.Z. News well ahead

Press, 3 November 1984, Page 23

N.Z. News well ahead

PA Auckland New Zealand News, Ltd, had a tax-paid trading profit of $3,497,000 for the 24 weeks to September 15 — 56.1 per cent ahead of the same period last year. The unaudited result includes the trading profit of Hawke’s Bay News, Ltd, for the five months until the end of August After allowing for extraordinary items of $1,173,000 (NZPA-Reuters distribution to date $3,169,000, transfer to group development provision $462,000, write-off of goodwill on acquisition $1,582,000 and sundry items $48,000), net earnings for the 24 weeks are $4,670,000 (last year $1,741,000).

Sales were up 37.9 per cent at .$64,502,000. Depreciation was $2,295,000 compared with $1,568,000 last year and tax was $2,233,000 (last year, $915,000 — restated). The chairman, Mr Leicester Steven, said although most group activities were conducted in a competitive market, sales, increased significantly and. most units were operating up to and in some cases beyond budget forecasts.

Highlights included: A distribution of $1,772,550 of unappropriated profits as a dne-for-five bonus on shares held in the company as at April 2,1984; an interim and special dividend (already paid) of 15 per cent from realised capital gains; finalisation of the Reuters asset distribution between NZPA members.

The N.Z. News group had a 26.9 per cent holding in the reconstructed investment company NZPA, Ltd, Mr Steven said. Valuation of the holding was difficult because of restrictions on the sales of the Reuters shares and the uncertainties

of exchange rates and share prices on the. London and U.S. markets. An appropriate method of valuing this asset had yet to be determined.

The acquisition of Hawke’s Bay News was another highlight With interests ranging geographically from Wairoa to Dannevirke in newspapers, commercial printing, office equipment supplies, FM radio and a computer bureau, the group of companies would be a valuable contributor to the N.Z. News Group, Mr Steven said. The year had seen the selling up of AAV-Vidcom, Ltd, a video cassette duplication facility, in partnership with AAV-Australia Pty, Ltd, of Melbourne, and the acquisition of an 11.65 per cent shareholding in the Timaru Herald Company, Ltd.

Mr Steven said projections for the second half of the financial year were good and directors were confident the results for the year would be significantly better than last year. “However, the level of profitability beyond the immediate future is less certain and undoubtedly the coming wage round and impending price increases will place great pressure on those units which must seek to recover these increased costs from the marketplace. “Work is well under way on a re-organisation of the group’s operation and structure to allow greater flexibility and relevance to the markets within which we operate,” he said.

“At the same time all areas of operation are under close scrutiny to ensure funds are invested in the appropriate areas to ensure long-term growth and profitability.”