21 Feb 2014

Nuplex set to restructure in NZ and Australia

10:02 am on 21 February 2014

Resins manufacturer Nuplex plans to restructure its Australian and New Zealand operations which is expected to cost 30 jobs and to save nearly $6 million a year.

After issuing two profit downgrades in its last financial year, Nuplex now says it expects this year's profit will be at the bottom of the range it provided at last November's annual shareholders' meeting.

The range is $130-$145 million and will mean the company has recorded three years of zero growth.

Chief executive Emery Severin says Australia in particular is going through a major structural change in industry and Nuplex will have to continue to adapt to that.

He says Nuplex will have to position its business to meet the market's needs and its customers demands going forward, as well as generating an adequate return on capital to shareholders.

Mr Severin says the size, overheads and management structure of the organisation will have to be tailored to meet the new reality of the market, which has been down more than 10 percent over the last two years.

Nuplex shares fell nearly 7 percent on Thursday before recovering slightly to close at $3.38, down 10 cents.

The company reported a $A11.4 million dollar net profit for the six months to December, compared with $A11.5 million the previous year.

The company blamed declining markets on both sides of the Tasman, as well as the high New Zealand dollar.