F&P Appliances profit slumps 45pc

Fisher and Paykel appliances. Photo / Glenn Jeffrey

Fisher and Paykel Appliances Holdings said its net profit slumped by 45 per cent to $18.4 million for the year to March, partly due to one-off charges.

The appliance maker said three items affected the bottom line: A lease charge of $2.7m, a fair value adjustment for property held for sale of $1.2m, and litigation costs of $6.8m.

Total one-off adjustments came to $10.7m before tax compared to a gain of $5.1m in the previous year.

Adjusting for one offs, the company said its normalised group net profit after tax was $26.3m compared to $30.0m in the previous year.

Net bank debt was $65.2m compared with $100.2m.

The appliances business reported an operating profit before interest and tax of $7.3m compared to $28.8m.

Fisher and Paykel Appliances said the result reflected lower revenue as the business re-focused on profitable sales, notably in North America.

The full year result was also hit by transactional hedging losses of $25.6m.

The finance business reported a solid result with operating earnings before tax of $31.0m, compared with $34.7m in the previous year.

Looking ahead, the company said retail market conditions were expected to remain soft across all its key markets in the near term due to global economic uncertainty.

"The board remains particularly concerned about retail market conditions in Australia, which deteriorated in the second half of the 2012 financial year," it said.

While there was a slight improvement in the US economic outlook, there are already signs that this might not be sustained, the company said.

The directors intend to restore dividend payments to shareholders as soon as possible.

"However, with conditions in our key markets remaining very uncertain, the directors believe it is prudent to take a cautious approach and have resolved not to pay a dividend at this time," it said.