Southern Capital posts steady profit

By Phil Boeyen, ShareChat Business News Editor

Wednesday 28th February 2001

Investment company Southern Capital (NZSE: SCL) has posted a small improvement in half-year profit to $542,000.

The result is $10,000 higher than the previous period. Sales were $1.87 million compared with $2.7 million previously.

Executive chairman, Graeme Wong, says the company is making excellent progress on several of its investments, with Clifford Bay Marine Farms, A2 Corporation, Canterbury Supa Centa and Omaha Beach all achieving important milestones.

Although sales are behind target for the company's 42%-owned Omaha Beach development, Mr Wong says earthworks for stages 1A and 1B are nearing completion, meeting the timetable established for the delivery of titles and settlement of the more than $32 million in sales contracts.

"We are confident, however, that the high quality of this development will result in continuing demand for sections - especially the beachfront lots."

Construction of the company's 30% held Canterbury Supa Centa was completed below budget and ahead of schedule, and the centre has been given further planning approval for the site.

"The approval allows a supermarket, which is a better than expected outcome," says Mr Wong.

Southern Capital says it is also pleased with its shareholdings in Dunedin-based biotech companies, A2 and Blis Technologies.

The company owns 7.47% of A2 and 15.7% of Blis.

Mr Wong says the company has entered a 50% joint venture that has contracted to buy a coastal property., and has several other projects under investigation with one currently "under offer".

"As always we will only invest on terms that meet our established investment criteria and whether a deal is done will depend on the negotiation process," he says.

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