Tower restores dividend payments

Rob Flannagan

Financial services company Tower today resumed paying dividends after it reported its September year net profit rose 23 percent to $34.6 million.

Tower's overall net profit after tax was $232.6m as the company earned $198.0m from the sale of its Australian business.

The company said it would pay a 6 cents per share imputed dividend on February 5. It is the first dividend for five years.

Chief executive Rob Flannagan said the board had always taken a cautious approach to the reinstatement of dividend payments.

"We wanted to ensure that Tower was first returned to a company that had the people, processes and growth to properly sustain and deliver dividends to its shareholders.

"It has been a long road but we have achieved that goal and the expectation is to continue to declare dividends."

Earnings per share from continuing operations were 18.27 cents and return on equity was 14.4 per cent.

It said all its divisions had shown solid improvement.

Mr Flannagan said the result was in line with expectations.

"Tower is now in a strong position to achieve further growth in the coming months as every part of Tower's business has shown the solid improvement we have been working towards."

It said corporate costs had been well contained.

Mr Flannagan said the company had also invested during the year in strategic projects that were important drivers of future growth.

"A 23 per cent rise in net profit after tax to NZ$34.6 million is certainly satisfactory and shows that hard work pays dividends, literally," chairman Tony Gibbs said.

Tower shares were up 1 cent to $2.03 in a firm market today. The stock has fallen from $2.38 at the start of the year.

- NZPA