Ebos Group higher

Press, 23 September 1988, Page 16

Ebos Group higher

The total profit of Ebos Group, the Christchurchbased medical supplies group, rose 23.4 per cent to $153,000 in the year ended June 30, compared with the previous 15-month period. The chairman, Mr J. B. Maddren, said on an annualised basis, the total profit was ahead 54%. Because of the present economy and the reorganisation of New Zealand’s health sector, the directors were cautious, but confident, about the new financial year. There were a number of factors that would have a favourable impact on the company. These included the sale of the scientific division, that was having a positive effect on cashflows and new tax rates at 28% (previously 48%) effective for Ebos from July 1, that would have a significant benefit, he said. Ebos’s chief executive, Mr M. B. Waller, said that the public hospital market, the

largest segment of business, was expected to change considerably within the next two years. The company had already noticed different buying patterns because of lower stock holdings in hospitals. A comparison of health spending in different countries was difficult, but even allowing for public versus private sector health, there was no doubt New Zealand spent less on health than other Organisation for Economic Development and Cooperation countries, he said. It was likely that the New Zealand public would demand a health system comparable with other developed nations. Within this framework, Ebos had the ability to perform, regardless of how the health system was split between the public and private sector.

Turnover fell 20.1% to $21,856,000 compared with the previous 15 months, but

Mr Maddren said on an annualised basis sales were ahead 10%. The' medical and dental divisions increased market share in a difficult year. The scientific division suffered from the severe cutback in funding of capital equipment grants. Since balance date, the scientific division had been sold. The pre-tax profit rose 16.8% to $465,000, compared with the previous 15 months. Tax took $232,000, $42,000 less than in the previous 15 months. The net profit, before extraordinary items, rose 87.9%, and extraordinary losses of $BO,OOO (nil previously) were a provision for expected costs on the sale of the scientific division. No final dividend is recommended, but the company has paid two interim dividends to give a steady annual rate of 10c a share (20%).