DOWN FROM HIGH ROLLERS Renouf ½ loss under $10M

Press, 8 March 1989, Page 37

DOWN FROM HIGH ROLLERS Renouf ½ loss under $10M

PA Wellington Renouf Corporation has reported a loss of $9,955,000 for the six months ended December 31, compared with >a loss of $209,836,000 for the similar six months the previous year. The reduced interim loss follows the company’s $401,226,000 loss for the year ended June 30 — a result that was second only in New Zealand corporate history to Rada Corporations S4B9M loss the same year. Renouf’s directors said in a statement that they were continuing to reduce the company’s debt levels. “The speed at which this can be achieved will determine the group’s future prospects,” they said. At December 31, Renouf had

long-term liabilities of $64.8M (down from S7IM at June 30), which were covered by longerterm assets of $237.6M ($238.5M). But the company’s working capital position was in the red by $72.5M. Working capital, the difference between current assets and current liabilities, is a measure of the resources which a company has to finance its day to day running. The directors said they were continuing to work closely with the company’s lenders, who had been “supportive” in their attitude to Renouf. The directors said a major factor influencing the result was the parent company’s interest bill of SIOM. They said this highlighted the requirement to reduce parent

company debt as quickly as possible. The result was enhanced by foreign exchange gains but these were offset by a loss incurred by the subsidiary, Alliance Textiles. Directors said a S7SM general provision created in last year’s accounts had not been utilised in the half-yearly accounts with the result being derived from the group operations. Outlining the performances of subsidiaries the directors said: • Alliance continued to incur losses which were significantly in excess of budget. • Subsidiary Renouf Properties incurred a modest loss in line with budget. Renouf Corporation had not concluded the sale of its 84 per cent shareholding in Renouf Properties at balance date but discussions with

interested parties were continuing. • Wellington retailer, Kirkcaldie and Stains, traded profitably during the period. The redevelopment of the store was proceeding according to schedule. • A scheme to privatise Hong Kong-based subsidiary, Impala Pacific Corporation, was completed during February, 1989. This would enable Renouf Corp to obtain partial repayment of between S2OM and S2SM of the outstanding debts owed by Impala. Impala would then operate as a joint venture between Ariadne Australia and Renouf Corporation. • Benequity Properties’ liquidity continued to improve through continuing sales from its United States property portfolio.