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Rangatira lifts FY guidance, pushes on with plans to boost liquidity

Tuesday 9th April 2013

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Rangatira, the Wellington-based investment company, lifted its guidance for full-year earnings growth, reflecting a stronger performance from businesses such as small goods maker Hellers and Auckland Packaging.

Growth in operating earnings in the year ended March 31 probably exceeded its earlier forecast of 10 percent to 20 percent, the company said in a statement. Operating earnings in 2012 fell 21 percent to $7.7 million, reflecting the sale of Dunlop Living and Tecpak Industries.

"Across the board, most of our companies have traded well this year," said chief executive Ian Frame. "The Heller brand is becoming increasingly strong in the marketplace, particularly on the small goods side."

Rangatira shares trade infrequently on the Unlisted platform. The 11.5 million B shares, which are mainly held by charities and have limited voting rights, were last at $7.5, while the 6.2 million A shares were last at $7. That gives the company a combined market value of about $130 million against total assets of about $180 million, based on the estimated asset backing at March 31 of more than $10 a share, it said.

To boost liquidity and attract more investors to the shares, Rangatira is planning a share buyback programme, which is to be voted on at the annual meeting in August.

Shareholders have to sign off on the plan because some members of the family of founder John McKenzie are deemed to hold more than 19.9 percent of the company in aggregate, and can't increase their stake without making a full takeover unless other shareholders approve.

As well as a share buyback, Rangatira plans to begin holding briefings for brokerages in the Wellington region to help lift the company's profile, Frame said.

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