Blind maker Kresta Holdings, which today released an interim profit down 63 per cent, has taken legal action in the WA Supreme Court to postpone a meeting called by fund manager Hunter Hall to take control of its board.
Blind maker Kresta Holdings, which today released an interim profit down 63 per cent, has been granted WA Supreme Court approval to postpone a meeting called by fund manager Hunter Hall to take control of its board.
The company was granted leave to delay Monday's extraordinary meeting until shareholders have received an independent expert's report on a takeover bid by Kresta director Ian Trahar who has launched a 32.5¢-a-share takeover bid.
Justice Michael Corboy decided this afternoon to delay until after February 24 when Deloitte is expected to have its report completed. A new meeting date is not known but is expected to be on or around March 8.
The takeover bid came after the boardroom stoush erupted between Mr Trahar and Hunter Hall which has a similar stake in Kresta. The two sides have fallen out over failed moves by Hunter Hall to install two directors at last year's AGM.
Mr Trahar's bid is conditional on shareholders voting down Hunter Hall's bid to dump him and fellow director Peter Hatfull from the board.
The Malaga-based blinds maker Kresta said weak consumer spending and a near-$900,000 payout to former executives has resulted in a significant dip in its interim profit.
Kresta reported a 63 per cent fall in first half profit to $1.6 million, down from the $4.3 million it lodged in the same period last year.
The profit includes a deduction of $874,000 relating to the termination cots of former CEO Tass Zorbas and another employee.
Revenue from sales was $60.7 million, down from $64 million in the prior half year.
Kresta blamed weak trading conditions for the drop in profits, which dipped to levels last seen during the global financial crisis.
"During the previous financial year the Federal Government stimulus package had a significant impact on the company's sales and the winding back of the stimulus and recent interest rate rises have, in the board's opinion, been a significant factor in the decline in revenue compared to the prior period," Kresta's results statement said.
"Furthermore, Reserve Bank data and commentary show that the savings rate for Australian households increased over the 2010 calendar year, at the expense of discretionary expenditure and exacerbating the decline in demand.
"This trend started in April 2010 has continued through the current half."
Kresta also said an underinvestment in product development, training and information technology by its previous management had left it vulnerable to the downturn in consumer spending.
Although it admitted the retail outlook was uncertain, Kresta said it was confident in its strategy as it continued to trade profitably.
At close of trade today Kresta shares were up 3.2 per cent, at $0.32.
