Fisher & Paykel says slowing demand, intense competition and higher costs have forced it to cut its profit forecast by up to 20%.
The pressures on Fisher & Paykel Appliances are nothing new, as the appliance maker has already alluded to tough trading conditions in its main markets of New Zealand, Australia and the United States.
Now F&P says sales in December and January were significantly lower than had been expected. The expected full year earnings for Fisher & Paykel Appliances, before one-time charges of between $NZ60 million $NZ65m, below last year’s forecast of up to $NZ80.
In the home New Zealand market, Fisher & Paykel Appliances says it’s facing intense competition from imports, especially from Korea and China, while consumer demand has waned in Australia and the United States so in all markets it has had to increase discounts to compete.
It’s already cut costs by moving production closer to its American market, and expanded into Europe by buying Italian cookware manufacturer, Elba last year.
Fisher & Paykel Appliance’s share price has fallen by 5%, 20 cents, by Thursday morning to $NZ3.60.