Steady-as-she goes from F&P's grey-haired board

New Zealand's largest home appliance manufacturer, Fisher & Paykel Appliances, breezed through its annual meeting in Auckland yesterday, although some of its directors may have left feeling a little long in the tooth.

The crop of grey hair on the stage prompted one shareholder to ask what its succession plans were for the board.

Chairman Gary Paykel said the "experience at the board table" provided the governance and support the company needed, "but time stands still for nobody and eventually we'll see some new faces". 

Updating the more than 250 attendees on the year so far, chief executive John Bongard reaffirmed previous guidance of earnings being similar to last year when the company had a net profit of $68.6 million.

He said that guidance would be dependent on the normal seasonal lift in appliance sales in the next half, particularly in the US.

Earnings for the first half so far, although down on the same time last year, were in line with expectations.

The company's finance group was expected to continue to perform steadily for the rest of the year, although that depended on stable interest rates and the levels of consumer confidence in New Zealand.

In July, the company said it was shifting some of its washing machine production to North America - a move which would boost annual earnings by $3.3 million.

The site location was still being negotiated but production was still expected to start early next year.

Bongard said the shift would now cost $2.5 million more than the $5.5 million it first announced as the company had since learned it was not eligible for a duty exemption on the plant entering the US.

Although the release of the new designer series of whiteware and a new advertising campaign had stimulated renewed interest in the brand, sales volumes in the competitive Australasian market were slightly behind last year.

Sales had been more positive in Singapore, Europe and particularly the US where, with the inclusion of the Dynamic Cooking Systems brand it bought last year, it was showing unit sales growth of 80 per cent year-on-year.

Steel prices were expected to decline for the rest of the year but rising oil prices would cut profits.