Richmond in review

Press, 27 September 1988, Page 28

Richmond in review

PA Wellington Richmond Smart Corp has begun its review of all its operations in a bid to streamline them and decentralise a large chunk of its businesses. Excecutive chairman, Mr Stephen Smart, said the company had lost its direction and overlooked the basics of business. Richmond Smart posted a $5.3 million ioss in its first five months to June and this included write-downs on investments and extraordinary losses of $4.9 million. At the time, the company had been financially restructuring under agreement with its bankers, specifically dealing with its loans. Mr. Smart had said the company would sell off fringe interests and retire about 60 per cent ($l2B million) of its debt. “Like a lot of companies, our priorities were not in the right order,” he said. “To improve efficiency and reduce overheads we are moving away frofn a head office situation and intend to decentralise ... where possible.” Richmond Smart had a

substantial quality asset base, but it had to be reduced to improve debt equity ratios. The company would now sell assets and “retire group debt by approximately 40 per cent,” improving shareholders' equity to about 45 per cent. . “We are certainly not in the ‘fire sale’ business. Our objective is to build shareholders’ funds,” Mr Smart said. Richmond Smart would be looking to reduce its current 65 per cent property investment to 40 per cent. This announcement came after news on Friday that Richmond Smart had dropped its arrangement to buy Landmark Corp executive chairman, Mr Oily Newland’s 25 per cent shareholding in that company. Richmond Smart alleged Mr Newland had “failed to disclose essential information concerning the affairs of the company” and was “unable to perform other material obligations.” > Mr Smart would not elaborate.