DRG rises 34%

Press, 17 August 1985, Page 25

DRG rises 34%

PA Wellington Office supplies group DRG (New Zealand), Ltd, has increased its interim profit by 34 per cent to $872,000 ($650,000) for the six months to June 30. Turnover at $22,139,000 ($17,151,000) was up 29 per cent. Tax was $336,000 ($225,000). Associated companies contributed $71,000 ($63,000). The interim dividend will be unchanged at 3.75 c a share tax-free, to be paid on November 1. The chairman, Sir John Marshall, said the buoyant economic conditions in the latter half of 1984 continued well into the first half of 1985 and DRG sales and profits grew. However, the high cost of

interest on working capital required to service the greater volume of business had a dampening effect on pre-tax profit. The packaging businesses, which were benefiting from the growth in exports, and the business equipment division had shown an encouraging improvement, which DRG expected would be maintained. The demand for stationery and consumer products, which had remained at a high level throughout the first quarter, became less buoyant as the period progressed, and reflected the decline in discretionary spending now becoming apparent. It was unlikely that the strong growth of the first halfyear could be maintained.