Sharechat Logo

Skellmax shrugs off weak markets

Friday 20th June 2003

Text too small?
It's unlikely many champagne corks were popped on May 29 when Skellmax Industries finally recovered to its issue price of $1.15, some 11 months after listing.

Even so, IPO investors at least have their money back on paper and the company should manage to keep its head above water from here.

Skellmax is unique on the NZX for offering both agribusiness exposure and the potential for growth through exports.

It does this by making rubber and foam products and pumps, mainly for the dairy industry. Sharebroker ABN Amro, which managed last year's float, reckons it has the potential "to expand its global dominance in the dairy rubberware industry and dominate the fragmented global market of vacuum pumps for industrial applications."

The company looks likely to meet or better its forecasts for June-year earnings before interest and tax of $20.8 million and a bottom line profit of $12.4 million, even though conditions last year, with slow markets in the US and Europe and the Australian drought, were tough.

It doesn't have to worry much about the New Zealand dollar's rise because the materials it imports provide a natural hedge for much of its business and financial hedging takes care of the rest.

It has an experienced board under chairman Keith Smith. Chief executive Donald Stewart has been with the group in one of its forms since 1979. His performance managing the "Good Skellerup" companies through the collapse of their corporate parent in 1999 was impressive.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Govt support for NZME/Stuff merger difficult, not impossible, says Jarden
NZ dollar stalled; US-China trade signals remain mixed
Ryman warns NZ, Australia to take population ageing more seriously
MARKET CLOSE: NZ shares fall as US-China trade concerns weigh on markets; Ryman slips
NZ dollar stalled; US-China trade deal may be postponed
AFT Pharmaceuticals starts to hit its straps
Crown seeks US$100m from Tui operator; Prospector moving on
Pacific Edge goes back to shareholders for another $20m
Crown seeks $100m from Tui operator Tamarind
Ryman underlying annual profit may rise by up to 17%

IRG See IRG research reports