11 Feb 2015

Business Briefs

1:59 pm on 11 February 2015

Goodman Fielder posts profit

Trans-Tasman food company, Goodman Fielder, has posted a $A28.6 million first-half net profit after a near $65 million loss in the previous first half.

The company said normalised operating profit for the six months ended December was flat, with earnings and margins in its New Zealand dairy business recovering after raw milk prices dropped, but the baking and grocery operations were challenged by price competition.

Goodman Fielder's shareholders will vote on a $1.3 billion takeover offer from Wilmar International and the Hong-Kong listed First Pacific on 26 February.

Augusta Capital buys Christchurch property

Property company, Augusta Capital, said it will buy an industrial property in Christchurch for $9.4 million which it intends to syndicate.

Augusta will seek $6 million from investors and will underwrite half that itself, with the other half being underwritten by a private third party.

The building on Birmingham Drive will be leased to the Australia-based magazine printer and distributor, PMP, for an initial 10-year term, providing a yield of 8.57 percent on the purchase price.

Australian business confidence soft

Australian business confidence and conditions stagnated at soft levels in January, despite the falling Australian dollar boosting some sectors.

The widely-watched National Australia Bank Monthly Business Survey showed that confidence edged slightly higher to 3 points, while conditions remained relatively steady at 2.

Both are below long-term averages.

Other indicators were also weak, with trading falling from 9 to 5, profitability easing from 2 to 1 and employment steady at relatively weak levels.

The bank said weakness in commercial construction and falling mining work was offsetting a strong residential sector.

Chinese inflation at five-year low

Inflation in China has hit a five-year low, rising 0.8 percent in January from December, making it the weakest reading since November 2009.

Forecasts were predicting a 1 percent rise.

The producer price index also missed forecasts, dropping 4.3 percent, marking its 35th consecutive monthly decline.

China's inflation has remained around five-year lows for the last few months, highlighting persistent weakness in the world's second largest economy.