Scott Tech hit by high kiwi
South Island manufacturer Scott Technology has posted a 63 per cent fall in half-year profit to $820,000.
The company said the result was affected by the high New Zealand dollar and tough market conditions.
The profit after tax for the six months to the end of February compares with $2.1 million the previous first half.
Scott makes automated production and process machinery for the appliance, meat-processing, mining and superconductor industries globally.
Despite the fall in profit the company declared an interim dividend of 2.5 cents a share, the same as the previous half year, and payable on May 6.
First-half sales at $25.2m were down slightly on the $26.8m in the 2013 first half because of the strong New Zealand dollar.
The company said sales across the entire business were strong but due to the effect of the high dollar and the competition to win project work, margins were lower than historical levels.
To deliver the profit the company increased focus on innovation and improving its processes.
The company had been affected by a slowdownin spending on equipment in the mining sector.
The appliance sector had good sales and forward work in the first half. Contacts were won from customers in North America, China and Germany but the margins were affected by the high dollar.
Scott delivered meat-processing equipment to Australian and New Zealand companies and interest was growing in Australasia and beyond in its new meat-processing systems, the company said.
Several appliance sales were won in China and the company expected China sales to grow.
The company said it was in a good position to deliver an improved performance underpinned by an aggressive development programme of new products and technologies.
Several potential purchases had been evaluated and rejected and the company was continuing to consider others because it saw the need to grow to achieve greater scale.