Wellington, New Zealand, March 6, 2006--Shares in Feltex fell 8 percent today, after the carpetmaker provided a trading update to the market.
The company said due to uncertainties in the marketplace it could not provide specific guidance about its expected performance for the rest of the financial year.
But it stressed that the three months to March were usually the 'weakest and most challenging'' in the carpet industry.
Shares in the company fell 4c to 44c, having ranged between 39c and $1.62 over the past 12 months.
Feltex said benefits from recent restructuring were starting to flow through in terms of operational efficiencies and the recent weakness in the New Zealand dollar was expected to have a positive impact on profitability.
But the company said it continued to face intense competition and pricing pressure.
Hamilton, Hindin, Greene partner Grant Williamson said things had continued to go from bad to worse for the company.
"It sounds like margins are getting squeezed due to an increase in competition, which is probably the last thing this company needs at the moment.
"They remain under some serious pressure,'' he added.
Feltex said January sales were in line with expectations, but margins were lower, while both sales and margins were lower than expected in February.
In late February Feltex reported a net loss of $11.83 million for the six months to December 31, compared with a $12.97m profit for the same period a year earlier.
The result was hit by one-off restructuring costs of $15m.
Feltex said since the balance date it had continued to work on improving efficiency, quality and sales.
It was also in the final stages of selling surplus property in Melbourne, with the proceeds to be put towards reducing debt.
