Exclusive by Patrick Avenell
SYDNEY, NSW: Fisher & Paykel national marketing manager Peter Russell has responded to reports questioning the manufacturer’s current financial position. Following a report from the Dow Jones news centre claiming the company had breached banking covenants, Russell spoke exclusively with Current.com.au to outline Fisher & Paykel’s state of affairs.
“We are paying down the debt faster than anticipated,” Russell said. “There was an overdraft on the loan facility which helped two things. It helped the expansion of the new factories in Thailand and the purchase of the Mexico [plant] from Whirlpool Maytag.
“We had to build a lot of stock, to cover the transition from the Australasian plants to those plants, and that was just before the GFC, and it got pretty ugly there for a while. Most companies were caught in the same situation, if they were doing anything with large infrastructure.
“In fact, the banking conglomerate, they’ve only just met with our board of directors in the last couple of weeks: we are paying down all that debt much faster than anticipated, so it’s completely the opposite.”
Although he assured the local market that Fisher & Paykel was performing well in Australia, Russell did say that the United States operations were still struggling.
“What was released to the market was, [regarding] the United States – it’s bloody awful over there, so Australia, as part of the overall pie, has gotten bigger, meaning there’s just that little bit more pressure on Australia.
“The Australian side of things, we’re shrugging our shoulders and saying, ‘what’s new?’, we’ve always known Australia is a significant part of things.”
Russell said the strategic selldown of Fisher & Paykel’s Tamaki plant had been completed, enabling the company to make larger than expected payments of its debt facility.
“The debt’s been paid down much faster, and certainly with things like Tamaki, we had a huge site over in Auckland, and we weren’t using all of it, so we sold part of it, and that’s paid down a lot of [debt], and Australia has performed better than we thought, and that’s paid down a lot of the debt too.”
In relation to the Dow Jones’ story, we asked Russell to specifically address the accusation that Fisher & Paykel had breached banking covenants.
“What [Dow Jones] didn’t say was that the banking conglomerate okayed that, and said ‘that’s fine’. It was countered by the better than expected performance of writing down the debt. So they’ve just pulled bits out and not told the whole story.”