Fisher & Paykel Downgrades Fiscal Year Net Profit
Feb 2, 2005
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High raw materials costs and low-cost imports from Asia prompted Fisher & Paykel Appliances Ltd. to cut its current year profit forecasts by as much as 19 percent.
The New Zealand-based home appliances maker said in a statement that the 12 months to Mar. 31 net profit is likely to be around NZ$63 million to NZ$68 million (approx. U.S. $44.8 million to $48.4 million), down from a previous forecast of NZ$75 million to NZ$78 million (approx. $53.4 million to $55.5 million).
The forecast is also well below the previous fiscal year's net profit of NZ$85.3 million (approx. $60.7 million).
The company, which in November commented on softer sales of its appliances in Australia, said profits are being hurt by "significantly more difficult than expected" trading conditions in Australia and New Zealand.
"In Australia, low-priced imports from China and Thailand increased substantially and have frustrated the acceptance of the company's price increase, announced in November 2004," the company said in a statement.
Low-priced imports from Thailand and China in some product categories have also hurt its appliances sales in New Zealand, the company said. The high cost of raw materials is also hurting the company's performance.
"Material commodity prices remain volatile and are at record high levels," the company said. "These prices are now being reflected in manufactured component prices as suppliers pass their increased costs on." (Dow Jones)
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