Provenco-Cadmus full-year loss widens; may sell assets

Thursday 28th August 2008

ProvencoCadmus, the business formed from the merger of two eftpos machine companies, posted a full-year loss and said it is considering assets sales to shore up its capital.

The net loss was NZ$36.3 million, or 24.38 cents a share, from a loss of NZ$3.2 million, or 2.4 cents, a year earlier, the company said in a statement. Sales fell 4.6% to NZ$161 million.

The company is grappling with a retail slump that's left it carrying high support costs while trying to win orders for its products. Its results include impairment charges against its international oil forecourt business and a reduction in the value of tax benefits.

A return to profitability is expected in 2009 and the outlook is positive, chairman Rick Christie said.

Still, weak equity markets mean the company is rethinking plans to raise more capital after it secured NZ$8 million from cornerstone shareholders Todd Capital and Peter Maire last month.

The company is using those funds as "a bridge" while it considers options including asset sales, Christie said.

The shares fell 5.3% to 18 cents, the record low it reached earlier this month. They have shed 65% this year.

By Jonathan Underhill

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