KEY POINTS:
A stellar summer has helped Fisher & Paykel Appliances post strong sales growth in the 10 months to the end of January.
The Australian market was the standout, recording a 17.2 per cent rise in sales revenue in Australian dollars, while the New Zealand sector was up 2.9
per cent, despite a weakened overall market. Europe also recorded sales revenue increases of nearly 30 per cent.
The only exception was the US, which was down 2.1 per cent.
But the high New Zealand dollar continues to hurt. The strong growth translates to only a 2.2 per cent increase in overall revenue.
Chief executive John Bongard said the strength of the kiwi has been "very, very unhelpful", but he was generally happy with the company's performance over the past 10 months.
The market reacted strongly to the company's announcement. Shares rose 11c to end the day at $2.68.
Analysts were, however, lukewarm.
One said the high dollar was clearly biting, with more challenges ahead for the company.
Forsyth Barr analyst Guy Hallwright said although sales were better than expected, there was nothing particularly encouraging on the margin front.
The US situation was not going to turn round quickly, while currency-related headwinds would remain for the foreseeable future.
"It's probably perceived as less bad than it could have been.
"It probably reflects that people were nervous that things might have been worse than that. And the US is probably the main thing."
Bongard said a hot summer has helped boost F&P Appliances New Zealand refrigerator sales. The company continues to gain market share in Australia, aided by the AquaSmart top-loading washer range, and the ice and water refrigeration range.
Europe has had positive growth, but has slowed from late November.
"We're still seeing market conditions there being pretty tight," he said.
The US market was proving tough, with intensified competition, although the DCS and F&P brands were still showing growth of just over 5 per cent.
"In that market, it is a job well done." Raw material prices, particularly steel, remain high, although the company has contractual agreements in place for most supplies until June.
Profit margins continue to be tight, and Bongard expected margins to remain flat for the near future.
"We haven't seen anything out there that has made us breathe a sigh of relief."
He said the construction of its factory in Thailand was progressing well, with the first dryer expected to roll off the production line on March 19.
The company has also received indicative bids for the finance business, with selected parties beginning due diligence.
"We expect the process to conclude towards end of March early April, and at that point of course depending on what the bids are on the table, we will decide whether that business will be sold or retained."
* ON THE RISE
Sales figures for April to January
New Zealand: up 2.9 per cent
Australia: 17.2 per cent
North America: down 2.1 per cent
Europe: up 29.1 per cent
Rest of world: up 13.6 per cent
Excludes non-appliance related sales.
