EXCLUSIVE: McPherson’s Fails To Mention Appliance Group “For Sale” Strategy At AGM
McPherson’s Limited who recently held their Annual General Meeting appear to be more interested in Beauty and Health than their struggling appliance business that earlier this year had a ‘For Sale” notice up.
At their recent AGM the Company Chairman Laurence McCallister talked about their beauty products bit not their appliance division.
He also failed to explain to shareholders why they appliance was put up for sale. ChannelNews understands that there were several interested parties at the time that the Company called for expressions of interest in the division.
Last month the Company who is refusing to talk about their appliance brands which include brands such as Euromaid, IAG, Elica, and Fagor advised that it expects underlying profit before tax for the half year to 31 December 2017 to be 10% to 15% below the previous corresponding period.
What’s not known is whether the appliance division is contributing to a significant fall in profits.
The Sydney based Company was forced to issue a comprehensive reforecast of their current financial year due to what they have described as “difficult trading environment and soft consumer sentiment”.
Sales at the Company who called for “expressions of interest” for their appliance Division declined in 1H 2018 revenue in the order of 6% compared with last year.
Based on outcomes for November 2017 to date and updated estimates for the remainder of the critical November-December trading period, it is likely that the reduction in sales and the anticipated
product mix will result in underlying profit before tax reported for the first half of FY2018 being lower than the first half of FY2017 the Company said in a statement to the ASX.
Back in 2013 McPhersons issued an equity raising document following their acquisition of Home Appliances in which they hold an 82% shareholding.
During an exclusive interview with ChannelNews last year their former CEO said that the Company was achieved revenues in 2016, of $100m, we now know this was wrong.
Steve Rorie, claimed revenues of $100M and that the Company was growing at 20% per annum.
12 months later McPherson who are trying to sell the business claim that “Steve Rorie’s quotation of annualised sales of approx. $100m, were gross sales before all forms of rebates and customer allowances are netted off our reported Statutory sales. Rebates and allowances typically equate to approximately 20% of gross sales”.
The distributor also said that the statutory sales quoted in February 2017 when McPhersons acknowledged that Home Appliances contributed to 22% of total revenues were for the 6 months to Dec 2017.
McPherson’s Australian operation’s sales revenue was $262.1 million, a decrease of 9.0 per cent on FY2016 ($288.0 million).
The Home Appliances division recorded a revenue decline of $4.1 million or 5.6 per cent, following the closure of a significant customer, and delays in some key commercial building projects.