Carpets magic for Cavalier

By ELLEN READ

Carpet manufacturer Cavalier has reported an annual net profit of $13.2 million - up 28.3 per cent on the previous year's result.

Operating revenue rose 29 per cent to $161.2 million on an increase in carpet business volume and a full 12-month contribution from Hawkes Bay Woolscourers.

The company declared a fully imputed final dividend of 17.5c a share, bringing the total annual dividend to 36c a share, which represents 86 per cent of the 2001-2002 operating surplus.

Earnings per share rose to 41.8c from 28.5c last year when the result was affected by closure costs.

The 2001-2002 financial year was the company's first full year of operation following the restructuring of its wool business and last year's $25.2 million shareholder repayment. Cavalier has also undertaken blowfly field trials in Australia through its Microbial Technologies.

Cavalier said its carpet operation - the main income generator - finished the year strongly after a slow start. For the full year, sales revenue was up 12.3 per cent to $108.9 million.

The company was disappointed it failed to realise a carpet sector earnings increase but said this was due to soft prices in the sector and a bias towards lower margin products.

"However the outlook going forward is very positive. Demand for our products, both domestically and internationally, is very strong," managing director Alan James said.

Cavalier's wool operations contributed $3.7 million before interest, tax and minority interest to the overall result, down slightly from $3.8 million the previous year (which included only an eight month contribution from Hawkes Bay Woolscourers).

"It was not an easy year in the wool industry because normal activity patterns were affected by extremely wet weather in both spring and autumn on the North Island," James said.

Cavalier's shares closed up 22c at $6.20 yesterday, compared with a year high of $6.40 and a low of $5.70.