Tuesday 25th May 2010
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Rangatira Investments, the Wellington-based diversified investor, posted a 33% jump in full-year operating earnings increase on improved returns from companies including small-goods manufacturer Hellers and packaging maker Tecpak.
Operating profit was $8.8 million in the year ended March 31, the company said in a statement. Its predominantly private equity portfolio of $143 million provided shareholder returns of 18.5% from its majority-owned packaging, foam, food and plastics investments.
“Rangatira’s diversified investment strategy had enabled it to come through the recession quite strongly so far, with the shareholder return this year more than recovering last year’s decline,” said chairman Murray Gough.
Rangatira, established in 1937, is 51% owned by the JR McKenzie Trust, with 15% held by community and charitable organisations and the remainder by some 200 individuals. In the latest year, asset backing per share rose to $8.05 from $7.09 a year earlier. Over the past seven years, Rangatira’s average annual return after tax has been 10.1%, Gough said.
The investment group is forecasting a 15% increase in operating earnings for the current year. Rangatira’s Class A shares last traded unchanged at $5.60 on the Unlisted platform.
Gough said some of its investments had a challenging year, including wine-maker Te Kairanga, which it wrote down by $4.4 million. Others produced very good results.
Hellers has grown strongly with its range of bacon, ham and smallgoods, thin-walled plastics manufacturer Tecpak recovered well from a difficult previous year, and Polynesian Spa had a more profitable year with upgraded facilities attracting good patronage despite the global recession, Gough said.
Dunlop Living’s furniture, bedding and underlay sales were hit by the decline in new building in New Zealand, and its volumes and margins did not achieve budgeted levels. Contract Resources also found trading conditions more difficult during the year.
“New Zealand’s food exports to a world increasingly able to afford quality products, and Australia’s resource earnings, underpin an encouraging outlook for both economies,” Gough said. “Rangatira’s portfolio of investments remains strongly focused on these two countries.”
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