(2 November 2005 – New Zealand) The market has reacted negatively to Tower’s statement that the second half performance of its risk businesses in New Zealand was down NZ$8 million on the first half.Despite the New Zealand based financial services firm’s assertion that its annual profit would rise more than 60 percent to between NZ$40 and 43 million, its shares fell 15 percent.
“Operating earnings from continuing businesses, which exclude Australian Wealth Management, investment income, head office and financing costs, are expected to be in the range of NZ$30.5 million to 32.5 million, up 40 to 50 percent on the prior year,” Tower said.
But Tower said the NZ risk businesses were encountering a number of problems primarily related to a decline in service levels.
“While these have been substantially remedied, the 2005 operating result in New Zealand has been adversely impacted,” Tower said.