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Carter Holt pulls A$55.4m dividend

NZ Newswire logoNZ Newswire 15/05/2017 Paul McBeth

Carter Holt Harvey Group pulled out an A$55.4 million (NZ$59m) dividend from its Australian unit in 2016, its first such return after several years of shoring up the wood products company's books.

The Australian unit's holding company, Carter Holt Harvey Building Products, paid a dividend bigger than its profit of A$21.3m in calendar 2016, down from A$30.7m a year earlier, financial statements lodged with the Australian Securities & Investments Commission show.

While revenue edged up 3.1 per cent to A$964.7m, the company's gross margins shrank to 8.6 per cent from 9.5 per cent in 2015.

Still, the forgiveness of A$275m of related party debts between 2012 and 2014 helped the Australian division get back on an even footing after slipping into negative equity and operational cash flow climbed 42 per cent to A$62.3m in the latest year.

Carter Holt's billionaire owner, Graeme Hart, tested the waters for an initial public offering of the forestry group in 2015 before shelving those plans indefinitely.

A year earlier, Hart's Rank Group sold the Carter Holt Harvey's pulp and packaging businesses for $1 billion to Japan's Oji Holdings Corp and Innovation Network Corp of Japan.

The Australian operation is currently in a dispute with the Construction Forestry Mining and Energy Union, locking out about 200 workers at its Myrtleford ply board manufacturing site when pay negotiations broke down.

The company's Australian wage bill rose 6.4 per cent to A$159.8m in 2016, while pension contributions were flat at A$11.8m. The manufacturer employs 1700 people across 12 factories and six distribution and sales centres in Australia, according to its website.

Carter Holt Harvey is made up of three divisions: building products makers Wood Products NZ and Wood Products Australia, and building products trade and retail supplier Carters.

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