22 Nov 2021

Metro Performance Glass makes $0.7m first half profit after Covid disruptions

12:40 pm on 22 November 2021

Auckland based glass manufacturer Metro Performance Glass has clung to profitability as it struggles to combat the effects of Covid-lockdowns and supply chain problems.

Metro Performance Glass - Highbrook Business Park

Metro Performance Glass at Highbrook Business Park in East Tamaki, Auckland. Photo: SUPPLIED

Key numbers (for six months ended September vs year ago)

  • Net profit - $0.7 million vs $7.6m
  • Revenue - $116.9m vs $117m
  • Operating earnings - $3m vs $12.8m
  • No interim dividend

Metro's half year was significantly battered by the pandemic and associated disruptions to supply chains as lockdowns interrupted manufacturing and installation.

The company's New Zealand operations suffered worse with revenue marginally lower but its operating earnings were down by 70 percent because of higher costs, while the government wage subsidy did not offset the impact as much as last year.

It said it had solid sales for its retrofitting business but commercial and residential supplies were hard hit.

Its Australian business, which is concentrated in New South Wales, Victoria, and Tasmania, had a 4 percent rise in revenue but it posted a small operating loss as supply disruptions and difficulty in getting staff weighed.

However, chief executive Nigel Mander said the building boom and changes to housing codes were driving strong demand which he expected to improve sales and revenue.

"As the New Zealand and Australian governments continue to rollout their vaccination programmes and the reopening of the economy, we expect this will provide certainty and a supportive environment for the construction sector."

However, he expected the problems which pressured the first half result to persist for a while.

"The international shipping environment and inflation have created significant cost pressures impacting gross profit. We expect this environment to remain for at least the next 12 months. Price increases to offset the rapid spike continue to be introduced, however there is a lag from a timing perspective," Mander said.

The company reduced its debt levels but decided to pay no interim dividend and decided not to make any full year forecast, but said it would update on trading in the new year.

Get the RNZ app

for ad-free news and current affairs