Free audio stream, including stories that are padlocked on our site. Listen on any device, anywhere. Updated twice daily. The audio stream takes several seconds to start on Android devices.Launch Radio player
BUSINESSDESK: Cavalier Corp is closing a yarn spinning plant in Onehunga, where about 90 people are employed.
The company is hoping to limit job losses to 70 by redeploying staff to other jobs. The plant, which will close on July 26, is part of subsidiary Norman Ellison Carpets.
"This decision is about reducing over-capacity in the yarn spinning operations that support the group’s broadloom carpet manufacturing operations", the company said.
Norman Ellison will continue to make carpet at its Onehunga tufting plant.
The shares last traded at $1.54 and have declined 21% this year.
The carpet maker said in June that market conditions for its carpet businesses remain very soft on both sides of the Tasman, with volumes and margins under pressure.
It said then that underlying earnings for the current year ending June 30 are likely to be in the range of $3 to 5 million after tax.
If it booked all of the one-off costs from a restructuring plan the company would report a loss of $1 million to $3 million after tax.
But the company is signalling a tax-paid profit in the range of $10 million to $12 million in the 2013 year, when it plans to recommence dividend payments.