Annual report holds up PRG trading

Pacific Retail Group shares won't trade for at least three weeks while the investment company - majority owned by Eric Watson - produces its annual report.

Shares in PRG, which closed 1c off a five-year low of $1.54 on Friday, were suspended from trading yesterday because the stock exchange had not received its audited annual result to March 31.

PRG's annual report containing the audited results was due to be issued on June 30.

However, the process had been held up by the unfinished sales audit of its former finance group, Pacific Retail Finance, sold to GE Finance in January for $145 million.

PRG's application for an extension had been declined by the NZX and the company - which said it had done everything it could to speed up the process - accepted the suspension last week.

PRG chief financial officer Paul Elliot expected results from the "complex" audit later this month.

Unaudited financial results were released on May 30.

Shareholders Association chairman Bruce Shepherd said the suspension was unusual.

"The only basis on which you'd do that is if the result is likely to be significantly different to current market expectations," he said.

However, the sale of the finance company - effectively removing an asset from the balance sheet - should not affect profit and loss.

"It might have an effect on debt and on balance sheet ratios but it shouldn't affect profitability," Shepherd said.

"I can't see why that would affect trading unless they suspect something will come out of the audit that might put the transaction at risk."

As PRG shares were thinly traded, Shepherd did not expect many complaints from shareholders.

PRG is 80 per cent owned by Watson's Logan Corp and 11 per cent owned by institutional investor AXA, which declined to comment on the suspension yesterday.

PRG plans to re-brand its troubled UK subsidiary, PowerHouse, to Go Switch On in an effort to improve the fortunes of the electrical goods chain.

The company lost $13.1 million in the year to March, dragged down by the continued poor performance of PowerHouse.

Last month, it again warned the chain could fail to break even this year with below budget sales growth in the last quarter.

Pacific Retail's other main businesses is lingerie company Bendon.

On a halt

* Trading of Pacific Retail Group shares suspended until later this month.

* The NZX is waiting on the company's annual report, now one week late.

* PRG is waiting on a sales audit of its former finance group.

* PRG shares last traded at $1.55