Shares of timber giant Gunns are trading at 10-year lows after the company revealed a poor first-half result and a complex restructure.
According to The Australian Financial Review, the Gunns share price is trading around 56¢ a share, compared with a 10-year high of $4.38 in January 2005. The value of the company has declined by $250 million since the day before it reported its dismal result on February 22.
The result was weaker than analysts expected, with net profit falling almost 100 per cent to $420,000. Revenue tumbled from $769.4 million to $325.9 million. Core forestry earnings fell to $12.4 million, blamed on weak woodchip volumes and issues with China supply contracts.
A stronger local dollar also hurt Gunns. The group does not expect any improvement in the second half but a gradual improvement this calendar year is anticipated.
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