Tenon reports dip as trading tougher than expected

Tenon, the former Fletcher Challenge Forests, has reported operating earnings of US$4 million ($5.3 million) in the six months to December 31, down from US$5 million in the same period last year.

Revenue of US$162 million was up from US$159 million last year.

The company said operating conditions were tougher than expected. It cited a strong exchange rate, declining moulding and better lumber prices, high domestic log prices and low demand as factors.

Tenon said products introduced over the past four years contributed to about 10 per cent of revenues for the six-month period.

The company's secured debt facility expires in June next year and this year it will consider how to structure funding for growth.

"Given the dreadful macro-operating environment, our financial result in the period was solid, and one which certainly stands up well to scrutiny against our peers," Tenon said.

"It is also a result that is exactly in line with the outlook statements we made at the company's annual shareholder meeting in November last year."

The longer-term outlook for the company remained positive.

- NZPA