Speirs posts smaller 1H loss on year-earlier impairments

Speirs posts smaller first-half loss as year-earlier impairments weren’t repeated

By Jason Krupp

March 1 (BusinessDesk) - Speirs Group Ltd., the food technology company, posted a smaller first-half loss even as revenue fell, reflecting impairment charges against a British joint venture in the year-earlier period.

The net loss was $634,000, or 5.85 cents a share, in the six months ended Dec. 31, from a loss of $5.1 million, or 47.06 cents, a year earlier, the company said in a statement today. Revenue fell to $6.4 million from $11.7 million previously.

The earnings improvement mainly reflected impairments of $3.6 million in the first half of the previous year related to its Speirs Nutritional Partners joint venture in Britain as well as lower administration costs. It holds 61% stake in SNP.

"Directors believe that the difficulties encountered over the past three years, many of them not of our own making, have been absorbed in terms of cost," said chairman Nelson Speirs. "Much still needs to be accomplished in terms of return to adequate profitability, cash flow and equity."

The company said its hopes to recoup some of its losses through the sale of SNP, with a subsidiary of a major U.K.-listed company looking to buy the rights to the company's intellectual property, processing technology and know-how associated with Omega-3 fish oils for £1 million ($2.2 million). The deal, which is still in the due diligence stage, is expected to be completed this month.

Speirs, which holds two million perpetual bonds in Allied Nationwide Finance Ltd., was forced to pay $85,000 in the period related to borrowing associated with the bonds. The company said it is likely to continue to incur similar costs until September 2013, when its can call in an option to "put'" the non-earning bonds to Allied Farmers Ltd. in return for a payment of $2 million.

The shares were unchanged at 12 cents today on the NZAX, having last traded Feb. 22.

(BusinessDesk)

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