KEY POINTS:
Biotech investor Wool Equities has managed to scrape out a small surplus in the half-year to December after a $5 million jump in non-trading revenue.
But it has acknowledged a business sold subsequent to balance date went for $1 million less than book value.
The company - mainly owned by sheep farmers who got shares as part of a carve-up of Wool Board assets in 2003 - had a flat trading revenue performance at $9.2 million. But non-trading revenue nearly quadrupled to $6.3 million.
Gains included a $2 million profit on the sale of the Wool Testing Authority.
The extra $5 million in revenue meant a small net surplus of $312,000 compared with a $4.3 million loss the previous year.
Since balance date, Wool Equities and the Wool Research Organisation have sold textile research company Canesis to AgResearch for $6.5 million.
While Canesis had become "modestly profitable" during the period both shareholders judged it as not being able to withstand future "revenue shocks", said Wool Equities chairman Andy Pearce.
He acknowledged Canesis' assets had been sold for about $1 million less than book value but said the sale had given Wool Equities a cash injection of about $5.8 million.
A group of disgruntled shareholders complained to the NZX that Wool Equities failed to get shareholder approval for buying Canesis and pointed out that it had previously been valued at $16.3 million. The group has also been seeking to replace board directors.
Meanwhile, Pearce said the company was concentrating on its key investments in wool proteins business Keratec and therapeutics business Orico.
Divestments last year had resulted in "reasonable cash reserves to support commercialisation of these technologies", Pearce said.
BioPacific Ventures, which last year acquired a big stake in Wool Equities, was said to be mostly interested in the Keratec operation.
