Rangatira Investments Interim Results 30 September 2017

28 November 2017

Rangatira profit after tax up $2.9m

Rangatira Ltd today announced its interim result for the six months to 30^th September 2017. Profit after tax for the period was $8.8 million, an increase of $2.9 million on the corresponding period last year. Rangatira’s underlying Operating Earnings fell by $1.6 million compared to the same period last year.

	Six Months to 30 September 2017 ($m)	Six Months to 30 September 2016 ($m)
Operating Earnings	2.4	4.0
Gains from Investments	7.1	1.9
One-off Items	(0.7)	-
Profit after Tax	8.8	5.9

Chair David Pilkington said, “The Rangatira Board has declared a fully imputed interim dividend of 24 cents per share (last year 22¢), to be paid on Monday 11^th December 2017.”

Rangatira’s shares trade on the Unlisted platform, and will trade ex-dividend from Monday 4^th December 2017.

Directors assessed the asset backing of Rangatira’s shares at 30^th September 2017 to be $13.23 per share, an increase of 24 cents from 31 March 2017. The total shareholder return after tax for the six months is 4.5%.

Mr Pilkington said, “Our operating earnings are seasonal, and the first half earnings are not indicative of the full year earnings. Hellers, Polynesian Spa and Rainbow’s End are all seasonal businesses and make most of their earnings in the second half. For the full year, we expect operating earnings to be similar to last years $11.7 million.

APC and Polynesian Spa performed well during the period. Polynesian Spa had a good half-year result, helped by growth in visitor numbers and increased sales. It is well positioned to make the most of continued forecast growth in tourism from key international markets. APC benefited from expansion into new product categories and improved operating efficiencies.

Bio-Strategy, Hellers and Rainbow’s End all reported lower earnings in the first half. Bio-Strategy was adversely affected by a downturn in the Australian market, but the Australian market has improved in recent months. Bio-Strategy is integrating the recently acquired VWR businesses and positioning itself for further growth. The wet winter weather impacted on demand for Hellers’ products and resulted in lower visitor numbers to Rainbow’s End. We expect more normal weather patterns in the second half and therefore demand will return to normal for Hellers and Rainbow’s End.

Rangatira has rebalanced its public investments portfolio resulting in a further increase in our allocation to cash. In the six months to 30^th September 2017, Rangatira added $9.8m to the cash position from sales of public investments.

On the lookout for profitable mid-market businesses

Over the period we looked at a broad range of opportunities, looking for firms with the potential to grow into the next iconic New Zealand brand or business. Our ideal opportunities are businesses with $10-100 million in annual revenue, and $2 million or greater in operating earnings.

Chair David Pilkington says, “Finding businesses where we can co-invest with capable owners and managers is an important criteria for our search. These situations often provide Rangatira with the greatest ability to add value through improved growth strategies and stronger balance sheets.”

ENDS

For further information, please contact:

Rangatira Investments +64 4 472 0251 info@rangatira.co.nz