Business / Companies
Phoenix Consolidated reports a loss for the half year
02 Aug 2011 at 06:17hrs | Views
The Board of Directors of Phoenix Consolidated Limited has released the interim financial results for the half year ended 30 April 2011.
Phoenix attained an operating profit of $263 000 from turnover of $4.1 million. This translated to a loss of $52 000 after taking into account depreciation and finance costs. Excluding Pacprint, which was disposed of in the prior year, turnover for the remaining units increased by $1.1 million. This increase did not result in improved profitability due to more competitive pricing and significant cost increases. Sales were below expectation reflecting the low demand in the economy and the impact of stringent credit control measures imposed by Phoenix. A major disruption in steel rod supply was also detrimental to Scandia's performance.
Plastics & Allied traded profitably and it was again the top performer in the company. The lack of public spending continues to affect trading at Plastic & Allied with no major contracts from government departments or parastals. Sales at Phoenix Brushware were again subject to limited disposable income.
The forecast surge in turnover at Scandia failed to materialize due to steel shortages arising from a major breakdown at a steel rod plant in South Africa. Supply to Scandia was affected for five months of the half year in this reporting period. Despite this setback Scandia posted an operating profit and with steel supply restored look forward to an improved second half. J W Searcy's operations continued to be hampered by the erratic operations of the mining industry.
The balance sheet has been relatively unchanged since the year end. Fixed assets have reduced by $200 000 due to depreciation and limited capital expenditure. Despite the increase in borrowings the net current ratio has improved to 1.9 times cover with a significant decrease in trade creditors. Shareholders funds decreased marginally due to the loss incurred.
All units reported operating profits before depreciation which was pleasing in view of the quiet trading conditions. All units are forecasting improved performance in the second half especially at Scandia where the problems of the first half have been resolved. Sales growth in all units will be limited by the tight liquidity and a cautious approach to credit sales.
Post half year, Phoenix concluded the purchase of McMeekan Founders and Precision Grinders from Apex for a net outlay of $330 000. Whilst these units are profitable, they will not have a material effect on the year's results both in terms of earnings and the overall Balance Sheet. These two units have operations that are allied to the mining, transport, construction and agricultural sectors.
Phoenix attained an operating profit of $263 000 from turnover of $4.1 million. This translated to a loss of $52 000 after taking into account depreciation and finance costs. Excluding Pacprint, which was disposed of in the prior year, turnover for the remaining units increased by $1.1 million. This increase did not result in improved profitability due to more competitive pricing and significant cost increases. Sales were below expectation reflecting the low demand in the economy and the impact of stringent credit control measures imposed by Phoenix. A major disruption in steel rod supply was also detrimental to Scandia's performance.
Plastics & Allied traded profitably and it was again the top performer in the company. The lack of public spending continues to affect trading at Plastic & Allied with no major contracts from government departments or parastals. Sales at Phoenix Brushware were again subject to limited disposable income.
The forecast surge in turnover at Scandia failed to materialize due to steel shortages arising from a major breakdown at a steel rod plant in South Africa. Supply to Scandia was affected for five months of the half year in this reporting period. Despite this setback Scandia posted an operating profit and with steel supply restored look forward to an improved second half. J W Searcy's operations continued to be hampered by the erratic operations of the mining industry.
The balance sheet has been relatively unchanged since the year end. Fixed assets have reduced by $200 000 due to depreciation and limited capital expenditure. Despite the increase in borrowings the net current ratio has improved to 1.9 times cover with a significant decrease in trade creditors. Shareholders funds decreased marginally due to the loss incurred.
All units reported operating profits before depreciation which was pleasing in view of the quiet trading conditions. All units are forecasting improved performance in the second half especially at Scandia where the problems of the first half have been resolved. Sales growth in all units will be limited by the tight liquidity and a cautious approach to credit sales.
Post half year, Phoenix concluded the purchase of McMeekan Founders and Precision Grinders from Apex for a net outlay of $330 000. Whilst these units are profitable, they will not have a material effect on the year's results both in terms of earnings and the overall Balance Sheet. These two units have operations that are allied to the mining, transport, construction and agricultural sectors.
Source - Byo24News
