Provenco to pay out 'reasonable' ratio of profit

Eptpos operator Provenco Group said today it would pay out a "reasonable" proportion of profits following the payment in August of its first dividend in eight years.

"Our intention is to continue with the payment of dividends each year and your board is looking to return a reasonable portion of the after tax profits each year to shareholders," chairman Provenco chairman David Wolfenden told shareholders at the company annual meeting today.

He said imputation credits would be used to the maximum available.

"Credits will be limited for the next two years until the group is back into a full tax-paying position," he said.

The former "tech wreck" intends to pay two dividends per year, with an interim dividend paid in April each year following the half year result. It paid 3c/share in August.

Mr Wolfenden and two other directors, Nicholas Gordon and former managing director Tony Bradley, were charged by the Securities Commission in December with insider trading and settled out of court earlier this month.

"Although the defendants had good defences to the claim made, the settlement was pursued because the board considered it was in the best interests of the company to do so," said Mr Wolfenden.

The charges related to three separate periods of trading in Provenco shares between February and March 2003.

Provenco paid the commission $300,000, Mr Bradley paid $150,000, Mr Gordon paid $130,000 and Mr Wolfenden paid $42,000 as compensation, penalties and a contribution to the commission's costs.

"I am pleased that this matter is now behind us," Mr Wolfenden said.

Mr Wolfenden said the board and management had been working on identifying the appropriate capital structure for the company.

"We are in significant growth mode and we continue to look for suitable businesses to acquire.

He noted the company's capital notes rolled over in April 2006.

"Your board will make further announcements on this matter in due course," he said.

The company said it was sticking to recent guidance that operating profit (after goodwill amortisation and before unusual items and taxation) was expected to exceed $9 million -- up from $7.6m in the 2005.

"I am pleased to advise that your board continues to have confidence with this guidance based on the results coming through in the early part of the year."

Provenco shares were down 1c to 92c today. They have traded between 59c and $1.01 in the last 12 months.

- NZPA