BusinessDesk report by Paul McBeth
Kirkcaldie & Stains, the upmarket Wellington department store, made a narrower loss in the latest financial year, and its board may have to write down the value of assets.
The company said its retail unit posted a pretax loss of $1.1 million in the 12 months ended Aug. 31, down from a loss of $1.8 million, a year earlier. Kirkcaldie’s fixed and intangible assets for the retail business were valued at $3 million as at Aug. 31, down from $3.7 million, and may need to be impaired.
“While this is an improvement on the 2013 financial year, the current year’s result will require the directors to consider whether they should recognise any impairment of the fixed assets and intangible assets associated with that part of the company’s business,” it said in a statement.
Earlier this month the retailer reached a deal to sell its Harbour City Centre building for $45.9 million, and plans to use the funds to recapitalise the retail business before returning any surplus to shareholders.
The retailer today said its leasing operation from the Harbour City Centre building reported a profit of $1 million, compared to a loss of $500,000 a year earlier, before any revaluation loss from the sale. Shareholders will vote on the transaction on Sept. 23 at a meeting in Wellington.
The shares dropped 10 percent to $2.05 yesterday, the lowest close since May, and have gained 7.9 percent this year. That values the retailer at $21 million.