Taylors June result 'disappointing'

Drycleaning company Taylors Group had a "disappointing" June-year net profit, with returns falling 18 per cent to $3.5 million.

And chairman Geoff Ricketts offered little prospect of improvement, saying major customers were demanding improved service at present or cheaper rates while costs were rising.

Taylors' purchasing policies together with operating efficiencies from new machinery should allow the company to meet customer expectations and maintain returns for shareholders, he said.

The firm paid $2 million during the year to install new equipment.

Ricketts declared an unchanged 6c per share dividend to be paid on September 15. The full-year dividend of 13c was up 2c on last year.

Operating revenue rose 6.7 per cent to $65.6 million but pre-tax operating profit fell 18 per cent to $5.4 million. Most of the revenue increase came through the Auckland and Hamilton plants servicing hospitals, where the drive for cost savings was putting the squeeze on service suppliers such as Taylors, said Ricketts.

Airlines were behaving similarly, cutting back on re-usable hand towels and other products.

Taylors' share price closed down 3c to $2.35 yesterday.

- NZPA