Page 6 - NZPM Annual Report 2020

CHAIR &

EXECUTIVE
Report

Our strategy of broadening and strengthening our core
plumbing business and investing in technology has your

co-operative well positioned for the future.

During the current economic cycle NZPM has • 3% net increase in the number of ordinary
understood the requirement to use the strong shareholders with 65 new members joining the
market conditions to improve customer service and co-operative during the year.
shareholder returns while investing in people, process, • Continued investment in technology to accelerate
technology and risk management. The investment new ways for customers to do business with us and
we have made has built capability for flexibility and improve our operating efficiency.
adaptability, and coupled with our strong balance
sheet will allow the co-operative to continue thriving in OPERATIONAL REVIEW
more challenging market conditions.
Plumbing World and Metrix continued to perform well
The business interruption in late March from COVID-19 in competitive markets. Along with the wider building
took some of the shine off our financial results as the industry, the co-operative continued to benefit from
final four business days of the financial year were lost robust customer demand, albeit coupled with the ever-
due to the Alert Level 4 lockdown. present downward pressure on market pricing.

HIGHLIGHTS FOR THE YEAR NZPM’s revenue growth of 6% was dampened by
the loss of the last four trading days of the financial
• Consolidated revenue increased by 6% to year. Had we been able to trade at normal levels,
$246.2 million. our expected year-on-year growth would have been

• Profit before net finance costs, dividends, rebate almost 8% (just over $250 million in total revenue).
dividends and taxation increased to $11.7 million, On a regional basis, revenue growth was strongest
however, direct comparison to the prior year is less in the upper North Island with the refocused efforts
straight forward due to the adoption of the new lease to improve our relative market position paying
accounting standard and a non-recurring gain on dividends, while sales in the remainder of the North
sale of an investment in the prior year. Island continued strongly. We did not achieve
expected growth in the southern region due to a
• An improvement in our health and safety highly competitive environment and a number of other
performance metrics with the total recordable market challenges in that area.
injury frequency rate reducing to 7.7 injuries per
million hours worked and lost time injury days NZPM’s overall gross margin was static compared to
reducing to two days. the prior year with downward pressure on margin

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NZPM GROUP LIMITED ANNUAL REPORT 2020