CONTENTS
BUSINESS PERFORMANCE
Financial Overview
ForestrySA’s financial performance
continued the excellent performance experienced since 2001-02.
Sales across most products increased from the previous year.
The housing construction and renovation markets have remained
strong during 2003-04 leading to a solid performance by
ForestrySA.
The strong sales results have been
influenced during the past three years by strong capital gains
experienced in the housing sector and historically low interest
rates. These factors have seen significant investment in the
housing industry during this period. Two interest rate rises in
late 2003 have softened investor activity and this has resulted
in a broad slowdown of the housing market. However housing
construction remains relatively strong due to a significant
build up of orders.
For 2003-04, turnover was $124.0 million
(2002-03 – $119.4 million) which is an increase of 3.9%
from the previous 12 months. Earnings before interest, tax and
revaluation for the year were $41.3 million (2002-03 –
$37.8 million) up 9.1%. This result includes Community Service
Obligation funding but is before income tax equivalents and
forest revaluation.
During the reporting period ForestrySA
paid to the Government $33.1 million comprising of dividends
($21.8 million) and taxation equivalents ($11.3 million).
Dividends paid included a special dividend of $0.92 million
that resulted from the above budget performance for the 2002-03
reporting period.
CORPORATE PROFILE
SOCIAL
ENVIRONMENTAL
ECONOMIC
FINANCIAL STATEMENT
Business Outlook
The financial performance outlook for
2004-05 is largely dependent on the activity of the housing
construction market.
The housing construction market has
remained resilient in 2003-04, however industry analysts
generally agree that a slow down across all states and
territories has commenced. Some analysts are expecting that the
peak of the slow down will occur during the 2006-07 financial
year.
ForestrySA is expecting that demand for
products in the 2004-05 financial year will not be maintained
at the levels experienced in 2002-03 and 2003-04.