Shower and tapware company Methven's bottom line profit for the March year fell 20 per cent to $5.1 million as it faces "ongoing tough conditions" in its main markets, especially Australia.
However, underlying operating profits excluding one-off costs was down just 3.4 per cent to $12.9m.
While sales in Australia dropped rapidly in a weak market, the New Zealand division's profits improved as the market here picked up.
Operating profits in New Zealand, excluding one-offs, were up almost 7 per cent to $8.5m.
Sales in Australia fell 12.9 per cent, but sharp cost cutting meant Methven's Australian division profits were down just 2 per cent.
There was a "modest recovery" in the British division, with operating profits of about £200,000 (NZ$373,000) in the second half, reversing a first-half loss.
The company's underlying net debt rose almost 15 per cent to $17.2m, according to results issued today, reflecting higher-than-expected stock levels as a result of sharply falling sales in Australia.
Despite the weaker profits, Methven declared a partly imputed final dividend of 4.5 cents a share.
Outgoing Methven chief executive Rick Fala said the "ongoing tough conditions in major markets continue to have a significant impact on business performance".
Australian division sales were down almost 13 per cent, with overall group revenues down 7 per cent reflecting the downturn in Australian market conditions. But cost-cutting, saw group operating costs down almost 9 per cent on the previous year.
Despite the rise in debt levels, the business was still "comfortably" within bank facility limits, Fala said.
"Directors are comfortable with the business' financial position and outlook and hence our ability to maintain a healthy dividend flow," Fala said.