FCL has record $153.9M profit

Press, 5 March 1987, Page 27

FCL has record $153.9M profit

PA Wellington Fletcher Challenge, Ltd, yesterday reported a record interim result to December 31, 1986, of $153.9 million ($133.2 million).

The result is a 15.5 per cent increase on the previous period, and the directors expect the full year profit to exceed the previously forecasted profit of $3OO million.

A 1 for 8 bonus issue to holders of ordinary shares equivalent to two ordinary shares for every five initial 16 per cent specified preference shares was also announced. The bonus shares will not qualify for the interim dividend, but will rank in full for the November, 1987, final dividend. An interim dividend of 10.5 per share was declared. The directors expect that the final divi-

dend will be at a rate of 12.5 c a share and that the annual dividend will be not less than 23 cents each ordinary fully paid share on the bonus increased capital. Total turnover of $2,367

billion was up 12 per cent on last year’s $2,117 billion, while domestic turnover rose 21 per cent. Export earnings rose by 25 per cent to $221 million. Fletcher Fishing alone increased export sales by 93 per cent to $66 million, with other significant increases coming from Challenge Meats and Fletcher Wood Panels. The North American sector, of which Crown Forest is the largest part, reported earnings of $53.2 million, nearly three times the amount of last year. Sir Ronald Trotter said the North American contribution, which amounted to 35 per cent of total group earnings, illustrated the benefits of major offshore diversification.

The net profit after tax was calculated on a modified historical cost basis. Operating earnings be-

fore tax were $229.1 million ($212.5 million). Investment earnings were $20.4 million ($7.7 million).

Corporate funding costs took $86.5 million (128.4 million), and tax took $4.6 million compared with a tax credit of $5.5 million in the previous corresponding period. Extraordinary items added $300,000 ($51.4 million). Minority interests were $6.9 million ($9 million), giving net earnings under historical cost accounting of $151.8 million ($139.7 million). Revaluation on investment properties amounted to $6.9 million (nil), and depreciation on asset revaluations took $4.8 million ($6.5 million), resulting in the net earnings under modified historical cost of $153.9 million ($133.2 million).

Shareholders’ funds increased from $1.35 billion to $1.91 billion.