Renaissance Corp (NZX: RNS) says it can meet its future interest cover covenants despite revealing a breach in its unaudited accounts for the 2009 year.
The technology and education company yesterday produced a $2.7 million bottom line loss on the
Renaissance Corp (NZX: RNS) says it can meet its future interest cover covenants despite revealing a breach in its unaudited accounts for the 2009 year.
The technology and education company yesterday produced a $2.7 million bottom line loss on the back of $3.4 million worth of one-off costs and writedowns.
Excluding unusual items earnings before interest and tax was $1.008 million.
"Given that position and expectations for 2010 the board does not anticipate having to make any changes to be able to maintain positive interest cover going forward," Renaissance said in a notice to the stock exchange.
The company has discussed details of the result and the breach with its bank.
Write-offs included stock, costs associated with senior management changes and a $1.6 million goodwill and intangible asset write-off.
Actual sales grew 3% to $194.8 million but the $2.7 million loss compared to a $1.2 million profit in 2008.
Meanwhile, new chief executive Richard Webb has commenced a full review of the business and has recommended that the organisation structure be realigned to lift revenue growth.
As a result the company will move its balance date to September 30 to improve its ability to forecast earnings in an environment where the December quarter is seasonally high and volatile.
Mr Webb will detail his plans when the annual report is released in March.
Renaissance has run into tough times after losing its exclusive agency to distribute Apple products in New Zealand.
Renaissance was New Zealand's sole distributor of Apple products until 2006 when the US technology giant launched its own New Zealand-based Apple and iTunes websites.
After losing its exclusive agency to distribute Apple in New Zealand in 2006, Renaissance embarked on a aggressive diversification drive.
The company bought private tertiary education provider Natcoll - with 118 staff and 5000 students across campuses in Auckland, Wellington and Christchurch - for $6 million in 2007.
The same year, Renaissance bought Apple retail chain Magnum Mac for $3.5 million. At the time, Magnum had an annual turnover of $28 million and profit of $1 million.
MagnumMac lost $1.597 million trading and another $740,000 from stock adjustments and other one-off costs in 2009.
