22 Feb 2011

Carpet maker not counting on NZ sales

9:00 am on 22 February 2011

The carpet maker Cavalier says it doesn't expect sales to improve in New Zealand, as building activity stalls.

The company's profit rose 22% to $8.5 million in the six months to the end of December, compared with the same period the year before.

Carpet sales in Australia rose 19%, offsetting a 15% fall in New Zealand sales.

Australia now accounts for 60% of the group's total revenue, which

rose 3% to $117 million in the half-year.

Managing director Wayne Chung says that while the company will experience a lift in carpet sales in Christchurch, as earthquake-damaged buildings are repaired, the local outlook's grim.

He says Cavalier is fortunate in having a diverse business, across the Tasman and in the United States.

The company has a conditional agreement to buy a 75% interest in Radford Yarn Technologies, and Mr Chung says that, if accepted, it will allow Cavalier Bremworth to expand its range of up-market carpets. He says Radford Yarns would retain its own brand.

The company expects its full-year profit to be between $15.8 million and $17.5 million, in line with the previous year's earnings.

Cavalier recently lodged an application with the Commerce Commission to gain control of the wool scouring business of New Zealand Wool Services International.