Fortuna outlook ‘promising

Press, 12 August 1986, Page 12

Fortuna outlook ‘promising

By

SIMON LOUISSON,

,jn Wellington

Fortuna Corporation, Ltd, is likely to receive a considerable boost from supplying equipment to America’s Cup contestants, the annual report states. The purchase of Ronstan Marine Pty, Ltd, during the year, a Melbourne manufacturer and distributor of marine products, makes Fortuna one of the largest marine equipment manufacturers and distributors in the world The chairman, Mr Bob Gunn, reports that the company had an “excellent” year with turnover double 1985 and net profit after tax at $1.6 million compared with $766,000, However, this was on much increased shareholders’ funds of $13.9 million compared with $3.8 million the previous year. This means that the return on funds actually declined slightly from 18.5 to 18.32 per cent.

' The proprietary 1 ratio improved significantly from'37.9 to 51.2 per cent during the year. : Mr Gunn said that the outlook for the year is promising particularly as next year will include a full month’s trading from the Australian marine and toy divisions. “Given a continuation of the trading conditions which have prevailed since about the beginning of the calendar year 1986, your directors are confident that barring: unforseen circumstances the 1986-87 financial year will see improvement in profits,” said Mr Gunn; Mr Gunn cited the decline in interest and inflation rates as being positive factors for Fortuna, and currency is not a big worry as the company is both an importer and an exporter. The introduction of GST should assist the company

as GST is less than the current sales tax on toys. Mr Gunn said that the company is evaluating a number of proposals for expansion and some of these will be soon enough to be included in the current year’s result. The performance of Fortuna’s 39 per cent associate, Commodore Computer Corporation, was “disappointing but understandable in the light of the market conditions prevailing in the computer industry.” Commodore reported an unaudited profit of $25,906 and this was not equity-accounted as the company has only been owned for nine ( months. The directors wrote $1,227,000 off the purchase price of its: Commodore investment to reflect the fall in the value of the company’s shares.