Power outages halt work at Fletcher Building plants

The Tasman Insulation plant in Penrose where they make Pink Batts. Photo / Dean Purcell

Work at four of Fletcher Building's main manufacturing plants in Auckland is on hold because of the power cut still affecting the city.

The company, New Zealand's biggest listed firm, says it is frustrated at the lack of information and certainty around the restoration around reliable power to its plants which had been in peak production.

A spokesman said work had ceased today at the Pink Batts, Winstone Wallboards and Fletcher Aluminium windows plants in Penrose and its AHI Roofing factory in St Johns. The company's Placemakers store in Lunn Ave, Mt Wellington was also closed.

Group general manager, investor relations and capital markets Philip King said the plants employed about 1000 workers. Today's first shift was told to stay home and those rostered on this afternoon would go to work but it was uncertain whether they could restart the plants.

Non-essential staff at the company's Penrose head office were also told to stay at home and the company was using generators to provide power for a skeleton team.

"Individual business units within Fletcher Building are developing plans to recommence operations based on site-specific needs. There remains uncertainty as when reliable electricity supply will be fully restored, and this will impact on the pace with which businesses return to normal operations."

King said Fletcher Building needed certainty about reliable power as further cuts could be costly. In the case of Pink Batts a power cut could mean molten recycled glass could set solid in in containers and need days to be chipped out.

"Safety is the main priority -- in a restart and there's always unintended consequences if the power goes off."

Workers who were told to stay at home today would be paid. The company had business interruption insurance but this did not kick in until the cost exceeded $10 million, King said.

"We hope we will be manufacturing tomorrow but we don't know if that will be the case because Vector say they are sharing the load and you don't know when they will pull power to support somewhere else.

While King said the shutdown will cost the company, at this stage it did not expect that the power outage would have a material impact on its results for the 2015 financial year.

The company had suffiecient stocks of most of its products but aluminium windows were manufactured to order.

"I think we have on ongoing and high degree of frustration. This is a very major outage and (we have) huge plants and operations and it's put the whole business on hold in the region and it's not good," King said.