Dunedin-based Scott Technology has flagged shrinking profit
margins to its shareholders as the ongoing strength of the
New Zealand dollar takes its toll on exporting manufacturers.
In a trading update to shareholders on the stock exchange
yesterday, chief executive Chris Hopkins said revenues
remained solid and the order book was at good levels, but the
company would continue to review operations because of the
short-term currency impacts on profit margins.
When contacted, Mr Hopkins said the kiwi had appreciated
almost 25% against its Australian counterpart in recent
months, from A75c to A93c.
In order to mitigate pressure on profit margins, Scott would
continue to use forward hedging contracts, and also look at
using the strong kiwi to buy components overseas, keep
reviewing its in-house costs and continue to build up its
He said there was increasing interest in leasing, which Scott
first offered about six months ago. Both the mining and meat
sectors were interested in leasing equipment, as opposed to