S&P keeps CHH rating steady

The country's biggest forest owner yesterday delivered a weaker fourth quarter profit of $4 million, down on $25 million a year earlier due to restructuring at one of its pulp and paper mills.

Despite that setback, S&P said results for the year to December 31 were broadly in line with expectations and would have no bearing on Carter Holt's BBB/Stable/A-2 rating.

Excluding one-off charges, Carter Holt booked a full year net profit of $137 million -- a more than five-fold increase on the previous year's $25 million.

S&P said the result showed operational improvements and cost savings had been made. Carter Holt was also benefitting from an increase in log prices, an active housing market and a disciplined approach to working capital management and capital expenditure.

"These positives helped to offset the negative impact of a stronger New Zealand dollar and faltering pulp prices," it said.

Carter Holt shares, half owned by the world's biggest forest products company International Paper Co, last traded down a cent at $1.75.

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