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Cavalier expects earnings to improve following restructuring

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Cavalier Corp, the struggling New Zealand carpet maker, expects earnings to improve this financial year and next as it reaps the benefits from restructuring its manufacturing operations, a lower wool price and reducing debt.

The Auckland-based company posted a loss of $2.1 million in the 2017 financial year from a profit of $3.1 million in 2016, weighed down by a 40 percent jump in restructuring costs to $6.3 million as it shut down factories and laid off staff to consolidate operations. Stripping out one-time items such as the restructuring costs, Cavalier's normalised earnings deteriorated to a loss of $1.9 million from positive earnings of $6.3 million a year earlier.

"It has been a tough year for Cavalier," chief executive Paul Alston said in his address to shareholders at the annual meeting in Auckland today. "While the full-year result was well down on expectations, the business did achieve much in FY 2017 and it is my sincere belief that we are now on a strong course to recovery, based on the work........

© The National Business Review