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New Zealand - AWF records strong results

15 May 2013

AWF Group (AWF:NZC), the contract labour firm, more than doubled annual profit after selling its Panacea Healthcare unit and will return most of the NZD2.24 million proceeds to shareholders via a special dividend.

 The Board of AWF Group has advised that turnover lifted by +24% to NZD 130 million (USD 104 million) and net profit after tax rose +165%  to NZD 6.9 million (USD 5.5 million) up from $2.6 million in 2012, after removing the net one off impact of the sale of Panacea. #

Chief Executive, Mike Huddleston reported that all sectors of the business continued to show strong growth and profitability in an economy receptive to the provision of quality temporary staff.

"Throughout the entire year, all divisions of the business continued to experience solid growth in an increasingly positive employment market. Whilst the predominantly rural regions of the country have shown slower growth due undoubtedly to the drought conditions, Wellington has witnessed a degree of recovery and Christchurch and Auckland have shown particular strength from growth in construction, infrastructure development and manufacturing" he said.

AWF claims to be New Zealand's largest provider of temporary staff, placing an average 3,000 people a day into jobs via a network of 34 branches.

Government figures this month showed New Zealand's unemployment rate unexpectedly dropped to 6.2% in the first three months of the year, driven by increasing job opportunities in Canterbury.

AWF does not expect the tight labour market to ease, saying it sees a lack of labour resources as a possible threat to the Christchurch rebuild, with increasing activity in Auckland likely to dampen the appeal of a shift south for skilled workers.

"We think there will be a return of a reasonable number of New Zealanders from Australia and these workers, supported by immigration, will go some way to meet demand," Mr Huddleston says. "This environment presents good opportunity for AWF."

The company did not give guidance for the 2014 financial year and says it is still searching for another acquisition.

AWF Group Ltd set a new 52-week high during today's trading session when it reached NZD 3.40. up 6.25% on the day and 41.67% above a year ago. This means the company is valued at NZD 82.57 million (USD 66 million).

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