Briscoe Group has lifted first-half profit 11 per cent, and revealed its hostile takeover bid for Kathmandu Holdings has picked up just 2.3 per cent of the 80.1 per cent of Kathmandu shares it didn’t already own.
Briscoe’s tax-paid profit rose to $NZ20.5 million (A18.27 million) in the six months ended July 26, up from $NZ18.5million ($A16.4 million) a year earlier, and in line with July’s forecast of at least $NZ20 million ($A17.7 million), the Auckland-based company said in a statement on Monday.
Sales increased 5.4 per cent to $NZ244 million ($A216.7 million), compared to the first half of the previous financial year.
In the six-month period, Briscoe reported its homeware earnings before interest and tax increased 11 per cent to $NZ17.6 million ($A15.6 million), while sales advanced three per cent to $NZ158 million ($A140 million).
Its sporting goods unit lifted earnings 29 per cent to $NZ10.7 million ($A9.5 million), while sales climbed 10 per cent to $NZ86 million ($A76.3 million).
Briscoe is offering Kathmandu shareholders five Briscoe shares for every nine Kathmandu shares as well as NZ20 cents per share.
Kathmandu’s board has rejected the offer and so far acceptances representing just 2.3 per cent of the register have taken up the offer to date.
An announcement to the NZX on Monday puts Briscoe’s shareholding in Kathmandu at 22.2 per cent.
Briscoe managing director, Rod Duke, has reiterated he won’t be upping the offer, which closes on Thursday.
“We are, obviously, disappointed in the low acceptance level in response to our offer,” Duke said.
“This suggests to us that Kathmandu shareholders are expecting the company to reverse the negative trends in its operating and financial performance of recent years, and to deliver greater value increases than they would obtain from a merger of the two companies…
“We see little chance of a turnaround sufficient for the directors’ published forecast of a $NZ30 million ($A26.6 million) profit after tax for their 2015-16 financial year (ie a 50 per cent increase) to be achieved.”