Howden warns strong rand may hurt group performanc
Trade and Industry Editor
ENGINEERING group Howden Africa has expressed caution about the effect the strong rand may have on its future performance.
It is worried there is a slowdown in the mining sector, which is an important customer base for Howden's products. Howden specialises in pumps and air purifying machinery.
Chairman John Feek announced his concerns to shareholders at an annual general meeting in Johannesburg yesterday. "The business environment and markets in which the group operates in SA have remained sound," he said.
"The continuing strength of the rand, however, will affect SA resource-based industries and exports, and we must expect that future projects and expansion could be delayed or deferred. We therefore remain cautious in terms of the outlook for the full year.
"Our appraisal of the various operations continues and the group has disposed of its interests in the wholly owned subsidiary Hertz Technologies." Hertz makes electric motors.
"Offshore activities are being closely monitored and Engart (which provides expertise in suppressing dust in mines) is establishing its presence in the environmental market in the US and is steadily building up a useful reference list.
"Export markets generally continue to be difficult due to the global economic environment and currency movements.
"Exceptional exchange losses totalling R7,2m were recognised for the year to December 31 2002.
"In the event that the exchange rates remain at their present levels, at the half year, this would result in a further exceptional exchange loss of R1,9m."
Jun 13 2003 06:10:22:000AM John Fraser Business Day 1st Edition
Friday
13 June 2003
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