Designer will cut its cloth NZ-style

By DITA DE BONI

Auckland-based Designer Textiles says pressures now squeezing its Australian operations have already been faced in New Zealand in the late 1990s.

In a statement accompanying its half-year result yesterday, managing director Kerry Harding said margins were down at the company's Logan Textile business in Brisbane because of an "excess of Asian imports" on the Australian clothing market.

But he said the experience of trading in harsh business conditions in New Zealand would be used to implement "more rigorous changes and initiatives to increase global sales from the existing base of $A6 million."

Designer's revenue for the first six months of this year was $32.8 million, up 47 per cent from last period's $22.6 million.

Tax-paid trading profit gained 24 per cent to $1.04 million, although the company's first write-off for goodwill on the acquisition of curtain maker Mollers Textiles reduced net profit to $844,000. The goodwill would be written off over 10 years.

The company planned to expand Mollers in Australia and hoped to open other avenues of non-clothing related trade in both Australia and New Zealand.

But Australian market conditions would continue to affect results in the second half and "actions taken to address the position would not flow through fully until the 2001 financial year," said Mr Harding.

A 1c interim dividend will be paid on March 29, with a second interim dividend to be paid in July and a final payout in November.

Designer Textiles closed up 1c at 31c yesterday.