Dollar rise knocks Skellmax net profit

By PAUL PANCKHURST

Manufacturing company Skellmax has reported a 1.8 per cent drop in net profit to $6.2 million for the six months to December 31.

Managing director Donald Stewart said the result was pulled back by the drop in the New Zealand dollar value of revenue earned by the company in the United States.

"Inherently, trading is going better than the figures would indicate."

Skellmax manufactures rubber products for the dairy industry and vacuum pumps for dairy and industrial uses.

It operates in New Zealand, Australia, the United States and China, where a new rubber factory is due to start production next week.

Operating revenue was $49.4 million - a drop of 1 per cent on the previous $49.94 million.

The firm calculated the figure would have been $2.8 million higher - and 4.6 per cent ahead of last year - if the NZ/US exchange rate of the previous period had still applied.

Earnings before interest and tax were $9.88 million - a 5.6 per cent drop on the previous period.

The company said that, with the NZ economy expected to slow, it expected a flat result for the full year.

Chairman Keith Smith said the result was solid, given "the uneven nature of the global economic recovery" and the effects of the high dollar, which included a dampening of demand from New Zealand's agricultural sector.

An unchanged 3cps dividend will be paid on April 8.

The share price closed 5c down on Friday, at $1.25.