Carpet firm faces slump

Carpet-maker Cavalier yesterday warned that its net profit this financial year could fall as much as 30 per cent due to "difficult" market conditions in Australasia.

Shareholders were told at the annual meeting that retail carpet sales, particularly in Australia, remained weak.

Group earnings were down 36 per cent on-year over the first four months of the fiscal year ending June 30, 2006. Managing director Wayne Chung did not specify if the four-month result referred to operating or net profit.

He said that on the basis of the present trends in demand, net profit could be 20 to 30 per cent lower than the previous fiscal year's $19.5 million.

The final outcome would depend on construction and renovation activity in Australia and New Zealand and on the strength of the kiwi.

- NZPA