A halving in demand for industrial equipment has led to a sharp reduction in earnings for investment company Hellaby Holdings.
Hellaby has reported a 43 per cent fall in earnings before interest, taxation and amortisation to $26.5 million for the year to June, down from $46.8 million last year.
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$4.6 million impairment provision relating to the sale of the BBQ Factory retail chain last year took its net profit to $700,000, down from $4.7 million in the previous 12 months.
Managing director John Williamson said market conditions had been tough across all of its equipment, automotive, packaging and footwear retailing businesses, and the company saw no signs of green shoots yet.
Its industrial equipment businesses such as AB Equipment had been particularly hard hit. "Corporates simply put their hands in their pockets, don't get the chequebook out, and will work for another year with an older forklift or road roller rather than buying a new one."
Its footwear retailing chains Hannahs and Number 1 Shoes had also suffered as consumers bought fewer pairs of shoes and looked for discounts.
But there were some signs of recovery in its automotive division, which supplied vehicle parts to most garages nationwide.
The recovery would come in sequence, and improvements would be seen at different stages and speeds across the company's sectors, he predicted.
Meanwhile Hellaby had restructured and tightened its businesses, improving cash flow and reducing total net debt by 26 per cent. Core bank debt was down 40 per cent to $51 million.
Williamson said the decision not to pay a final dividend had been a tough one.
