Leaner Mt Hutt brings profit

Press, 5 December 1988, Page 17

Leaner Mt Hutt brings profit

PA Ashburton A leaner operating structure allowed the Mount Hutt Ski and Alpine Tourist company to turn a net operating profit for the second “low-snow” ski season in a row.

At the company’s annual meeting held in Methven, shareholders heard Mr John St Clair Brown, chairman of the group’s parent company, Leisureland Corp, speak optimistically about the future of the Mount Hutt Skifield.

The net operating profit for the 12 month period ended March 31, 1988 amounted to $278,102 compared with $78,944 for the 15 months ended March 31, 1987. However, the accounts show a net loss after tax for the year of $470,421 compared with a loss of $809,552 for the previous period. In spite of two very bad snow seasons, the company had managed to

trade at a profit for the six month period ended September 30, 1988. This period was likely to show an operating profit of $1 million, reducing to a $400,000 profit, Mr St Clair Brown said. While the company could not be described as profitable, Leisureland had no intention of selling off the Mount Hutt company, he said. “We’ve made an absolute commitment to Mount Hutt. We did not expect it to be easy and we did not expect it to be a get rich quick operation. We believe in this company and we believe in its product.” » The Mount Hutt company was in a sound position, as was its parent

company, he added,

Leisureland has a conservative gearing, but was suffering like everyone else from a lack of earnings, as it had paid high interest rates, and the current year would see it turn only a small profit. “However, most of our operations are in the developing stages, and they depend on things happening in the future. But we can sit the situation out,” he said.

A three-year development plan had been scheduled for the company, and this included power supply to the field, now completed, snow making, terrain improvement, two new chair lifts and expanded base lodge

facilities. “The 1988 season has indicated and supported snowmaking as an immediate priority for the company, for Methven and for the wider community,” Mr St Clair Brown said.

He listed this as the company’s first target on the development plan, followed by the squad chairlift that would replace the field’s two lower T-bars.

While profitability was still low, Mr St Clair Brown said the Mount Hutt company was still on its projected track, “and that gives me confidence that there is a future for the ski field and the ski industry," he said.