The company now expects a consolidated operating profit for the year ended June of $43million to $47 million, down from $59.1 million last year. Earnings before interest and tax (ebit) will be between $28 million and $32million, down from $44.7 million last year.
But Hellaby's board decided to keep the dividend unchanged, which was welcomed by brokers yesterday.
Hellaby managing director Alan Clarke said in a statement following a soft first-half for the resource services group, further refinery shutdown delays had continued to affect the timing of international contracts.
As a consequence, while second-half earnings would be an improvement on the first half, full-year earnings for the group would be significantly down on the previous corresponding period.
A new chief executive was being recruited to lead the resource services group.
The positive sales growth in the automotive group in the first half had continued. Higher year-on-year earnings were expected, including a full contribution from JAS Oceania and a two-month contribution from Premier Auto Trade, both of which operated in the Australian auto electrical market.
The equipment group was expecting year-on-year sales growth, driven mainly from increased truck servicing revenue, Mr Clarke said.
"The higher revenue is at reduced margins, partly because of the sales mix change and partly because of the weaker New Zealand dollar. This will affect full-year earnings, which are expected to be slightly down on the last financial year.''
The footwear group, which included Hannahs and Number One Shoes, continued to struggle in a soft and difficult retail environment. Several options for the group were under investigation, he said.
"The 2016 financial year will be a transition year for Hellaby. The very challenging conditions in the oil and gas markets are the main contributors to the lower expected full-year result.''
Also, there were one-off restructuring costs, investment into the start-up loss-making truck and trailer parts and no contribution from Elldex Packaging, which was sold at the end of the last financial year.
The focus for the remainder of the financial year was to work with the large resource services customers around the world to confirm scheduled shutdowns in the next three to six months, resource and complete current jobs and drive additional cost savings, Mr Clarke said.
Considerable effort was also being made to progress opportunities to broaden the specialist maintenance revenue streams into adjacent areas of customers' industrial processing operations.
Hellaby's balance sheet was strong and the company was well-resourced to deliver attractive and growing medium to long-term shareholder value, he said.
