Repco expects good year

Press, 12 October 1985, Page 22

Repco expects good year

PA Auckland Repco Corporation NZ, Ltd, is confident of a strong performance in the present financial year. The chairman, Mr N. Walford, and the managing director, Mr L. P. J. Evans, say in a joint statement in the annual report that the state of the company in 1986 will depend greatly on the level of success the Government enjoys in reducing inflation and interest rates.

As reported, the Repco year to June 30 produced a 62.7 per cent increase in net earnings to $13,026,000, on net sales of $195.8 million. Tax paid was J2795M.

The company made extraordinary net gains of $821,000, which were the difference between the capital gains on the sales of properties and investments, at $1,583,000, and extraordinary losses of $762,000 resulting from the move to the

new distribution centre at Mt Wellington, Auckland. Investments sold included the Repco holding in Auric Corporation, Ltd. The directors say that, after deregulation of the finance industry, profitability for finance companies came under pressure from greater competition, causing margin reductions. The finance sector is now regarded as truly specialised and outside the mainstream of Repco’s activities. During the year debentures totalling $4.2 million were repaid. In addition, stock reductions in terms of davs cover and the sale of $3.4 million worth of surplus properties resulted in a reduction of borrowings at a time of high interest rates.

The directors say it is planned to open at least four Motor Specialties outlets in the present year, and additional outlets of Roadhaul Specialities are also planned.