By Phil Boeyen, ShareChat Business News Editor
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Tuesday 21st August 2001 |
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The company has reported a jump in net profit to $7.03 million for the six months ended June, more than three times last year's figure of $2.04 million.
The company says a solid contribution from its leather operations in China lifted the result and helped push earnings per share to 9.8 cents from 2.8 cents last year.
"Our leather operation in China is now starting to fulfil its promise. While this business is still in an expansionary mode, profits are beginning to flow," says chairman, Alastair MacCormick.
Revenue from the China leather business more than doubled to $107.5 million, with the surplus before overheads and interest rising to $5.5 million, up from $136,000 previously.
"Our leather operation in China is significant in world terms, and the investment and commitment we have made and are continuing to make in building this business is now starting to deliver returns to shareholders."
The company reports that with New Zealand operations also performing strongly, it has made a sound start to the year.
"New Zealand businesses contributed $11.1 million to the surplus before overheads and interest, up 35%," Mr MacCormick says.
During the year the company sold its venison businesses and although regulatory approval has been given for the sale of its Colyer Mair business, no sales agreement is in place.
RCH says its New Zealand semi-processed leather operation also made a solid contribution to the result although it was down 15% down on the same period last year.
However its Beijing Blue Zoo lost $758,000 during the period compared with a profit of $485,000 last year, and the outlook is not positive.
"This business faces demanding price cutting tactics from local competitors," says Mr MacCormick.
Directors are not recommending an interim dividend and are also warning that the second half is unlikely to match the first.
"The outlook for the second six months is positive. However, with no second half contribution from venison and uncertainty as to the ongoing ownership of the New Zealand semi-processed leather business, the next six-months' profit is unlikely to match that of the first half."
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