New Zealand's leading commercial supplier of plumbing, pipelines, electrical and safety products is finding the economic conditions stubbornly tough as its parent company posts a 47.3% fall in half year profit.ASX-listed Crane Group yesterday reported a n
New Zealand's leading commercial supplier of plumbing, pipelines, electrical and safety products is finding the economic conditions stubbornly tough as its parent company posts a 47.3% fall in half year profit.
ASX-listed Crane Group yesterday reported a net profit of $A15.87 million for the six months to December 31, down from $A30.11 million in the previous corresponding period.
The group said it expected full year net profit to be down 35% on fiscal 2009.
In New Zealand Crane Group operates brand names such as Mico Plumbing and Pipelines, MasterTrade, Corys Electrical, Equipsafety, and Hydrotech Sanitar with over 120 sales branches and 1200 employees nationwide.
Crane said its first half performance was impacted by subdued market conditions in its Pipelines and New Zealand Trade Distribution businesses.
Its Crane Distribution New Zealand (CDNZ) unit was singled out as a main factor in the poor first half result.
Revenue at CDNZ fell 27% to $152 million for the period.
Lower margins resulted in a trading loss of $A900,000 for the six months, compared to a trading profit of $2.4 million the previous corresponding period.
“The business has been able to reduce significantly its operating costs over the past two years but this has not been enough to overcome the impact of the dramatic downturn in market activity,” Crane said in commentary accompanying the result.
Commenting on the outlook Crane Group managing director Greg Sedgwick said economic conditions in Australia and New Zealand had posed significant challenges over the past six months but Crane's Groups financial position remained robust.
"The full year earnings performance for Crane group will be heavily dependent on trading conditions in Pipelines and New Zealand over the balance of the financial year," he said.
"Broader economic indicators in both Australia and New Zealand have shown some improvement in recent months, although this is yet to manifest itself as a sustained improvement in demand in some key market segments.”
Crane Group bought plumbing and electrical supplier MasterTrade from PDL Holdings for about $A40 million in 2001.
Sign up to get the latest stories and insights delivered to your inbox – free, every day.
