The Examiner
Gunns $2 billion pulp mill project was being maintained in “ready status” as the company continues its search for a financial backer. Managing director John Gay said the company was in negotiations with a number of parties who had expressed interest in becoming a joint venture partner. “We are expecting to reach agreement on key terms with a partner by the end of April 2009,” Mr Gay said in a statement to the Australian Stock Exchange. “We believe there is strategic value in introducing a partner with a strong industry position to the project, including bringing construction, operational and marketing experience.” Mr Gay said the primary source of funding for the development would be a project finance debt facility, which is being coordinated by a European bank. “This is a project that has become even more crucial for the Tasmanian and Australian economies as the impact of the global financial crisis is felt on employment,” Mr Gay said. “It is a project which will provide over 2,000 jobs during a two-year construction period and 1,600 new jobs during operation. “At a time when many companies are making workers redundant, we are one of the few with a major job creation project being progressed.” Mr Gay said the mill project was being maintained in a ready status to proceed on achieving financial close. Read more here
And, Gunns announces $33.6 million profit
Tasmanian forest products company Gunns Limited today announced a substantial increase in net profit after tax for the half year. The company’s profit of $33.6 million was up 95 per cent on the prior corresponding period. Earnings before interest and tax increased 57 per cent to $69.3 million. This included non-operating income from the revaluation of financial instruments of $12.0 million (pre tax) and non-operating expenses of $3.5 million (pre tax) arising from business restructuring costs. Gunns Chairman John Gay said the result was driven by a solid performance by the core forest products division. “Forest products revenue increased 18 per cent to $355.9 million, while earnings increased 23 per cent to $59.8 million,” he said. The board declared a fully franked interim dividend of 2 cents per share, to be paid on April 20. Read more here