Nuplex First Quarter Surplus Up 50%

Nuplex First Quarter Surplus Up 50%

Statement from the Chairman of Nuplex Industries Limited based on his address to today’s annual meeting held in Auckland

Nuplex is on track to achieve “double digit” growth in the current financial year.

This will be fuelled by favourable trading conditions in Australia, Asia and New Zealand, steady margins, a sound contribution from Asia Pacific Specialty Chemicals (APS), the company’s new Australian acquisition, and a new agency to market a range of paper process chemicals.

At Nuplex’s annual meeting in Auckland today, Chairman Fred Holland told shareholders that after the first quarter’s trading, net surplus was 50% ahead of the same position last year.

“While this trend will not be maintained over the balance of the year as raw material prices increase, with such a good first quarter result behind us we can expect a significantly better net surplus before abnormals than was achieved in the last financial year.”

For the 2002 financial year Nuplex reported an audited record surplus before abnormals of $19.1 million ( up 34% ).

He said the acquisition of Australian public company APS would add a “further $200 million turnover” to last year’s revenue of $420 million and that earnings from the operation were “running ahead of expectations”.

“APS will also take us into new market segments with opportunities for growth.”

He said the key elements of Nuplex’s growth strategy are obtaining greater critical mass, diversifying its markets geographically and attracting non New Zealand investor interest.

“ A key focus will be consolidating our position in the Australasian chemical industry, growing our initial investments in the Construction Product business segment, and through supporting the growth of our Vietnamese investment, increasing sales into Asia.

“The opportunities for resins and polymers throughout Asia are promising.”

He said output from the company’s Vietnam plant was double original expectations, with demand still “racing ahead of supply”. The company will support its Asian operation with product from other operations until a second emulsion extractor comes on stream in the first quarter of 2003.

A high temperature resin plant in Vietnam is also scheduled to come on stream in the first quarter of next year.

In the 2002 financial year, revenue from the Vietnam operations was $14.2 million, up 23%.

Australia remains the company’s most important market, with sales of $294 million, up 4%, and an EBITDA contribution of $31.2 million, up 11%. The Australian operation generates 70% of the company’s sales.

Agreement has been reached with Hercules Inc of the United States to distribute its range of paper process chemicals.

“This will add significantly to our presence in the paper industry business, and to the company’s revenue and earnings.”

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