27 Feb 2009

Pyne Gould posts $17 million loss

10:16 pm on 27 February 2009

An increase in bad debts at its finance arm has seen Pyne Gould Corporation post a half-year loss.

The company lost $17 million in the six months to December, compared to a $22 million profit in the same period a year earlier.

The result has been hit by $34 million in provisions for bad debts at finance firm Marac, including a $25 million underwriting facility provided by Pyne Gould, as well as the company's share of losses at PGG Wrightson in which it has a 22% stake.

Pyne Gould Corporation managing director, Brian Jolliffe, says most of the increase in bad debts comes from its property development business which accounts for 19% of Marac's balance sheet.

Looking ahead, Pyne Gould is expecting demand at Marac and Perpetual Trust to remain soft and expects a fall in operating profits in the second half of the financial year.