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Tapware maker Methven flush with success

NZ NewswireNZ Newswire 25/08/2016 By Fiona Rotherham

Methven, the shower and tapware designer, has reported a 31 per cent increase in full-year net profit to $7.7 million with strong sales in New Zealand and Australia, continuing a turnaround in its performance that started last year.

The Auckland-based company changed its reporting date from March 31 to June 30 and in the 15-month period profit was $8.6m, it said.

Reported 12-month sales revenue of $105.8m was up 8.1 per cent on the prior year in line with guidance and up 6 per cent on a constant currency basis, its first material revenue growth since 2009.

Chairman Phil Lough said the results are in line with guidance for the fourth consecutive time and evidence of its improved revenue forecasting and internal controls.

The directors declared a partially imputed final dividend of 4.5 cents per share payable on Sept. 30, taking total dividends for the year to 9.5 cents.

Sales performance was highest in New Zealand where it rose 11 per cent to $35.7m supported by double-digit tapware growth while earnings before income and tax excluding non-recurring items rose 17 per cent to $4.7m.

In Australia, sales increased by 6.9 per cent to $39.6m with a strong performance in the showering category and a slight increase in earnings before interest and tax.

The UK market also showed a strong earnings increase of 122 per cent to $553,000 though revenue fell by 2.3 per cent to just under $12m and below expectations due to a delayed start of contracts won during the financial year.

Chief executive David Banfield said he was pleased with improvements made to the business throughout the year, though much work remains to be done.

The company remains committed to lifting revenue to $130m by June 2018 under a three-year strategic plan focused on its three key markets of New Zealand, Australia and the UK.

The shares last traded at $1.31, and have gained 14 per cent this year.


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