Asset sales Empac key

Press, 2 November 1989, Page 42

Asset sales Empac key

PA Wellington The future viability of Empac Holdings depends on its directors selling assets to lower debts and cut financing costs, auditors warn. Collapsing property values dragged Empac, formerly James Smith, to a bottom line loss of $7,716,000 for the 10 months ended June 30. Its directors blamed the depressed New Zealand commercial property market for the poor result. In a brief statement to the Stock Exchange, Empac said the result compared to a bottom line profit of $1,981,000 for the 12 months ended August 31 last year.

The result forced its associate, Australis International, to write off $2,474,000 as its share of the loss. That company’s full year revenue statement showed a net loss of $152,000 before tax ($352,000 in 1988). An extract from the auditors’ report on Empac

said: “The company is currently negotiating sales of assets to reduce its borrowings and financing cost. The financial statements have been prepared on a going-concern basis, the validity of which is dependent on the successful conclusion of those negotiations.”

Empac Holdings audited result for 10 months ended June 30 1989 10 mths ($000) 1988 12 mths ($000) Sales 8796 3600 Gross result (1493) 1267 Prop, devaluation (5036) (860) Pre-tax result (6529) 407 Taxation — (914) Net loss (6529) • (507) Equity result 118 (38) Extraordinaries (1305) 2526 Total result (7716) 1981