‘The bleeding has effectively stopped’, K&D annual meeting told

THE chairman of embattled hardware retailer Kemp and Denning Limited has told shareholders the company’s outlook is “greatly improved”.

The K&D hardware store in Murray St, Hobart. Picture: MATHEW FARRELL

THE chairman of embattled hardware retailer Kemp and Denning Limited has told shareholders the company’s outlook is “greatly improved”.

Greg Goodman told the annual meeting in Hobart on Thursday the company expects to break even this financial year after a $9.8 million loss in 2016-17.

“We have now closed this very difficult chapter in our history and I am delighted to report the bleeding has effectively stopped,” Mr Goodman told the Wrest Point meeting.

The 115-year-old company closed stores at Devonport, Glenorchy and Cambridge and sold its trade division to Clennetts Mitre 10 during the year to extinguish $7.4 million in debt.

“Your directors believe the potential for shareholders is greatly improved as a result of our efforts to quickly close loss-making operations and sell our trade business,” Mr Goodman said.

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In an announcement likely to increase speculation about the future of the Melville St operations, Mr Goodman said there had been a revaluation of the company’s property assets by several registered Hobart valuers.

The assets were worth $18.25 million in 2015.

“While the variations have not yet been adopted by the Board, it is pleasing to note that there is additional equity in our property holdings,” he said.

Hobart CBD property values are believed to have soared by at least 10 per cent since the Fragrance Group and University of Tasmania began buying in the area.

MORE: K&D FORCED TO TIGHTEN ITS BELT AFTER $9.8 MILLION LOSS

MORE: CLENNETT’S MITRE 10 BUYS KEMP & DENNING TRADE STORES

Mr Goodman said each of the 2,683,635 shares in the public unlisted company had net asset backing of $8.74 per share making the company worth $23.4 million.

Recent share sales at $3 a share value the company at $8 million.

Directors were asked why a 2013 offer of $68 million from Woolworths, which was leaked to the Mercury, was never referred to shareholders.

“The offer submitted by John Danks and Son was non-binding, subject to due diligence and confidential,” general manager Jason Hutton said.

“At the time the board believed that for commercial reasons the offer ought not to be diclosed to shareholders.”

Directors Susan Allison-Rogers and Robert Rex were re-elected.