K&S Corporation has announced a net profit after tax of $5.6 million for the half year ended 31 December 2013. According to K&S, the prior comparative period featured “much stronger trading conditions”, particularly in resource-driven Western Australia.
Operating revenue was $258.3 million, down 12 per cent on the prior period. The company said the decrease was largely due to the weakness in demand for transport services on the eastern seaboard, lower activity levels in Western Australia and the cessation of the Australian Paper contract at the end of June 2013.
“After a disappointing first quarter to FY2014, we have seen some modest improvement in underlying trading conditions in the second quarter of FY2014. We are also seeing some benefit from the steps taken to reduce costs to align the cost base with customer volumes,” said K&S Managing Director, Greg Stevenson.
Recent contract wins in Western Australia with Argyle Diamond and Kimberley Diamond together with new contracts in New Zealand should assist the second half performance.
The result was impacted in the first half of FY2014 on a pre‐tax basis by $970,000 by one off re-organisation costs and transaction costs associated with the current merger with Scott Corporation Limited.
The merger announced by K&S Corporation in November 2013, in which K&S indicated its intention to merge with Scott Corporation by way of a conditional off-market takeover bid (“Offer”), has now been declared free of any defeating conditions and accordingly the Offer is now unconditional.
The level of Acceptances received from Scott Corporation shareholders received under the Offer currently stand at 93.16 per cent of Scott Corporation’s issued share capital.
In a statement, K&S Corporation said that it intends to exercise its compulsory acquisition rights to acquire any Scott Corporation shares in respect of which has not received valid acceptances by the close of the Offer at 7:00pm (EDST) on 4 March 2014.
#K&S’s Board is pleased to advise that we have received sufficient acceptances from Scott Corporation shareholders to entitle us to exercise compulsorily acquisition rights over any outstanding minority shareholdings,” said K&S’ Deputy Chairman, Greg Boulton AM.
“With the Offer scheduled to close on 4 March 2014, we urge any Scott Corp shareholders who intend to accept the Offer, but have not already done so, to send in their acceptance forms in accordance with the bidder’s statement before that date to ensure that the provision of consideration for their shares is not delayed.”
The merger between K&S Corporation and Scott Corporation will create a merged group with annual revenues of about $750 million, a market capitalisation in excess of $200 million, and more than 2,000 employees.