Chairman John Maasland is likely to spell out what is in store for CHH. Picture / Fotopress
The country's biggest forester, Carter Holt Harvey, is in the news for two reasons.
Number one: former managing director Chris Liddell - now chief financial officer of Microsoft - has resigned from the company's board.
Number two: observers expect the company to miss this year's profit forecast and say it
could spell that out at today's annual meeting in Auckland.
"Chris has let us know that his new role as chief financial officer of Microsoft will impact on the amount of time he is able to devote to Carter Holt Harvey," said chairman John Maasland.
The high dollar and a drop in Australian construction are putting pressure on CHH's earnings.
The annual meeting is chief executive Peter Springford's first opportunity to say whether his $300 million operating profit forecast for this year is achievable.
"It is looking pretty difficult," said James Lindsay, of Tyndall Investment Management.
The dollar has traded above 70USc for three months while building approvals in Australia, 40 per cent of of CHH's sales, fell to a four-year low in March.
These issues have spurred speculation that International Paper, CHH's 50.5 per cent owner, may be losing patience with its 13-year investment.
Springford had set "a bit of a stretch target" for earnings, said Andrew Mortimer, at First New Zealand Capital.
Lindsay said International Paper probably would not review its shareholding until after CHH completed the sale of about a third of its forests.
"Previously I was in the camp that said they would probably be a seller," Lindsay said. "I can't see anything happening at the moment," given CHH's reduced share price and the prospect of a capital return from the forest sale.
- BLOOMBERG
