The chairman of listed finance company Cynotech has predicted more failures in the sector and said his company would continue to proceed with caution.
Chairman Allan Hawkins said his board was "not really happy" with its full year net profit of $1.8 million, "but we were pretty hardon ourselves".
A provision for bad debts cost the company a charge of $540,000 against pre-tax profit, and it wrote down other assets by $130,000 to reflect "market realities".
However, he said the result was an improvement against a loss of $1.2 million at the end of 2004.
Total assets had grown to $26 million from $1.3 million in December 2004, when Hawkins bought listed technology firm Rocom and folded it into Cynotech.
Hawkins said full disclosure was a particular concern this year.
"We showed that our finance loans are well spread and we do not have any major concentration of risk - our six largest loans had an aggregate value of $1.6 million.
"Also we do not have many loans where interest is capitalised rather than being paid on a monthly basis."
Hawkins said he believed there was still bad news to come in the market and the economy overall.
Some properties had been sold at least 30 per cent lower than valuations done as recently as the middle of last year.
"We will see developers being bankrupted ," he said, and several finance companies who were "just limping along" would be out of the market and in survival mode for a while.
Shares in Cynotech were unchanged on the NZX yesterday at 16c.
* Allan Hawkins is the one-time boss of 1980s high-flyer Equiticorp Holdings. The company collapsed following the 1987 sharemarket crash.
