WSI spins last year's interim loss into significant profit

Tuesday 1st February 2011

Wool processor Wool Services International (WSI) has turned around last year's interim deficit, amid a recovery of prices in a difficult international market, and said it also expected a strong second half.

For the six months ended December 31 the company posted a $3.05 million net profit compared with a loss of $680,000 a year earlier. Total operating revenue rose to $84.8 million from $65.2 million.

The result also beat last year's annual net profit of $2.23 million.

Poor wool prices were improving during the current international marketing push.

"We believe the wool market has staged an excellent recovery in line with many other commodities and there may be still some upside potential even with the latest rises," managing director Michael Dwyer said.

The company said part of its strength was its strong links with wool growers.

"We do not promise impossible premiums to wool growers but what we do promise is to pay the best market price on the day and move wool from farm gate to our scours in the most economic and efficient manner at minimal cost to our grower clients and ourselves."

Its two wool scours, another key to its improved performance, were working to capacity although wool supply remained of some concern.

The future of the majority WSI shareholding, held by Allan Hubbard's company Plum Duff remained unclear, and discussions were continuing with Hubbard's receivers.

Shares in WSI, which will pay a one-off imputed dividend of 2c per share on May 6, were unchanged this afternoon at 47c.

NZPA

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