The figure includes a NZ$106.5m write-down in intangibles, including a NZ$99.8m write-down in goodwill, putting the trading loss in the region of NZ$70m.
The total after-tax loss is nearly a fivefold increase on the NZ$35.2m loss it posted for the full year ended 30 June 2008 – a further NZ$147.6m fall into the red.
However, the company said this was largely comprised of non-recurring expenses related to the write-down and restructuring costs.
Geon’s revenues fell year-on-year from NZ$383.6m to NZ$334.9m for the year ended 30 June 2009 – a 12.7% drop that it said was better than the industry average.
Chief financial officer Ashley Fenton told ProPrint: “It has been a GFC-impacted set of results and a very difficult period, not just for us but for the industry.
“Demand from customers has been subdued, but we’re cautiously optimistic about the period ahead,” he added.
“The bottom was definitely reached last year and there are signs things are improving. Later in the year, we expect improved customer demand,” said Fenton.
He said the write-down of goodwill and intangibles reflected Geon’s “prudent” approach.
“Effectively, the directors have to reassess the value of the intangibles taking into account current and future trading. There was a view to be more prudent,” said Fenton.
The financial statement gave detail on the new credit facilities Geon announced late last year.
According to the statement, Geon negotiated a debt package of A$243.5m and NZ$41.2m on 9 November 2009, with a maturity date of May 2013.
The statement also said: “The ability of the group to meet its commitments and ongoing operating expenses will depend upon: revenue and cash flow projections being met; [and] continued access to the new facility arrangements entered into on 9 November 2009.”
In the auditor’s report accompanying the financial statement, PriceWaterhouseCoopers said: “The validity of the going concern assumption on which the financial report is prepared depends on the ability of the group to meet its revenue and cash flow projections and continued access to the borrowing facilities.
“If the company were unable to continue in operational existence for the foreseeable future, adjustments may have to be made to reflect the situation that the assets may need to be realised at other than in the amounts at which they are currently recorded in the balance sheet.”
Fenton said the auditor’s statement was a “technical requirement” and he was confident Geon would meet the criteria.
He added that the company was “very happy” with the relationship it had with its financiers. “They are very supportive. The facility has the ability – with minimal covenants – to continue potentially to 2015.
“We do have to meet some criteria to get that extension but we are covered well into 2012,” said Fenton.
Comment below to have your say on this story.
If you have a news story or tip-off, get in touch at editorial@sprinter.com.au.
Sign up to the Sprinter newsletter