25 March 2011
The Groupâ€™s unaudited result for the six months ended 28 February 2011 was a net profit before tax of $2.2 million, compared to an unaudited net profit before tax of $1.4 million for the six months ended 28 February 2010. Group revenue for the six months was $21.8 million, compared to Group revenue of $20.3 million for the six months ended 28 February 2010. A pleasing aspect of the first six monthsâ€™ result is the strong positive cashflow from operations of $1.6 million.
Review of Operations
The Groupâ€™s diversification across a range of industries has enabled us to deliver a strong result. This strong result has been achieved whilst dealing with variable global economic conditions and a high New Zealand dollar exchange rate.
Demand for our products and solutions has fluctuated across different geographical markets and over time, as has the worldâ€™s economic conditions.
Scott Technology has experienced a strong interest in demand, particularly from North America for appliance production lines and from both New Zealand and Australia for our meat processing solutions. Standard products for mining, including reference materials, have mirrored the global increase in demand and prices for commodities. With increasing demand from customers to reduce their own costs, coupled with their need to increase productivity and quality, the Group is seeing renewed interest in automated solutions that address their requirements.
Scott Technology was affected by the earthquakes that occurred in Christchurch during the first half of the financial year. We were very fortunate that our staff are safe and well and that our Christchurch manufacturing facilities sustained only minor damage. We resumed operations to near full capacity within several weeks. We are aware of friends, colleagues and businesses in and around Christchurch that were not so fortunate and our thoughts are with them.
The Groupâ€™s forward work is at record levels as we head into the second half of the financial year. With increasing pressure on a broad range of costs our focus is firmly on successfully completing this work with maximum efficiency.
The Group is actively looking at ways to expand capacity to take full advantage of the many opportunities being presented.
The Directors have approved an interim dividend of 2.0 cents per share, an increase of 0.75 cents on the 1.25 cents per share interim dividend in 2010, payable on 8 April 2011. This recognises the strong underlying performance of the Company and the strength of the Companyâ€™s balance sheet, coupled with strong cashflows and forward work position.
The Company continues to see growth opportunities across a range of activities and will progress these where they add value to the business