Vertically integrated forestry and sawmilling company, York Timber Holdings, on Monday reported a headline loss per share of 141 cents for the six months ended December 31, 2009, from earnings of 27 cents previously.
It reported a basic earnings loss of 135 cents, from a gain of 27 cents earlier.
The group recorded revenue of R407.33 million, from R601.52 million in 2008, and operating profit stood at R12.19 million from R104.44 million.
No ordinary dividend was declared taking into consideration the debt facilities extended by York's bankers and other growth plans during the period under review, the group said.
York said it had not escaped the consequences of the severe downturn in the worldwide economy.
"In particular, the South African building sector has seen a slow-down over the past 18 months and a decline in the demand for sawn timber," it said.
York added that downward price pressure was also experienced due to excess capacity in the sawmilling industry, a situation that was exacerbated by the temporary oversupply of lumber due to the salvage operations subsequent to the fires in 2007 and 2008.
"The South African sawmilling industry has seen the closure of several sawmills over the past year and during the latter half of 2009 York embarked on a restructuring process to align its processing capacity with the current market demand," it said.
Looking ahead, York said it remains largely self-sufficient in terms of logs supplied by its own timber plantations and owns four modern, well-managed sawmills and a plywood plant.
"On recovery of the economy, York will gain the benefits from its restructuring and become even more competitive in the market."
"One of management's key objectives remains to increase the Group's profitability. This objective will be fulfilled through optimising its processing facilities, utilisation of own raw materials, improving operational productivity and exploitation of its leading position in the softwood market."
"The Group also plans to increase its ownership of forestry resources, should these opportunities present themselves," it concluded. - I-Net Bridge