Sales at luxury goods maker Waterford Wedgwood will be down 9 per cent for the half-year to September 30th, the company revealed yesterday. It also announced that it plans to sell a further €100 million in preference shares, the second such sale this year, to fund more job cuts and revenue growth.
Company chairman Sir Anthony O'Reilly said revenue fell during the six months as the first €100 million share sale, announced in April, was not finalised until July, affecting production.
Speaking to reporters after the company's annual general meeting in Dublin yesterday, Sir Anthony said he believed the €200 million in share sales would be enough to pay for further restructuring and growing sales.
The company is in final talks with a US institutional investor to sell €50 million worth of preference shares in the second €100 million share sale.
Sir Anthony and his brother-in-law Peter Goulandris, the company's deputy chairman, contributed €83 million in the first €100 million share sale this year, with the remaining €17 million coming from shareholders.
The two men have applied for a further €17 million in the second fundraising. With the US investor set to take €50 million in preference shares, the company is confident of raising the remaining €33 million from investors.
Over the last four years, Waterford Wedgwood has raised more than €400 million, the bulk of which has come from Sir Anthony and Mr Goulandris. Sir Anthony told reporters that he had invested "a couple of hundred million" since he first became involved in the company in 1990.
He said the firm's two best investments had been the €90 million restructuring of operations and the purchase of a factory outside Jakarta in Indonesia, where the currency of choice is the dollar, eliminating the company's heavy exposure to currency fluctuations.
Sir Anthony said the declining dollar had "hurt this company more than almost any other company, certainly in Ireland and possibly in the British Isles. For the company to get back to where it was five years ago, the dollar needs to appreciate by 60 per cent".
He said the dollar may continue to decline over the coming years, so the company needed to cut costs further and look at locations, like Jakarta, where it was "insulated" from the currency movements.
Sir Anthony said there would be job losses "across the board - in Germany, Ireland and the UK".
The company said it had its best September for sales since 2003 and was expecting healthy sales growth this month. Sales for the first six months to September fell by 7 per cent "at constant exchange rates," the company said.
The company is planning to develop its 35-acre site in Waterford with Ballymore, the company owned by developer Sean Mulryan, in an effort to attract more tourists, said Mr Goulandris.
The company's share price fell 6.2 per cent yesterday, to close at 3 cent, valuing the company at €160.6 million.
