Kresta shares dip on write down news

Shares in Malaga-based Kresta have recorded a modest drop after the company announced it would need to write down the carrying value of its inventory by up to $6 million.

In a statement to the Australian Securities Exchange Kresta said the write down will result in a decrease in the net assets of the business.

The blinds manufacturer said the write down will also reduce the company's profit for the 2010 financial year by between $3.85 million and $4.2 million.

In its annual report released last month, Kresta said its profits had increased by 85 per cent to $6.8 million.

Despite the write down Kresta said it continues to have sufficient retained earnings, to pay the final dividend of 1.5 cents per share announced with the preliminary final results on August 19.

Kresta shares had traded as high as 40 cents earlier this month.

Kresta shares resumed trading today after being in a trading halt since last Thursday and closed the day down 4 per cent or 1.5 cents at 35.5 cents.

Last week, managing director Tass Zorbas also resigned from the company.