Ansell appoints director, warns on South Pacific Tyres write down

By Liz White, ERJ staff

Richmond, Australia-Ronald Bell has been appointed to the board of healthcare specialist Ansell, with effect from 17 August 2005. Bell will fill the vacancy left when Michael McConnell retires at Ansell's Annual General Meeting, to be held 17 Nov.

Bell, who will be based in the UK, has had over 30 years experience with the Kraft Foods group, for the last five years as president of Kraft Foods, Europe.

Earlier, the board of Australian-based glove maker Ansell said that it is confident that its Ansell Healthcare business would meet its 2005 EBITA commitment of $115 million.

But it warned of a write down in value of its share in South Pacific Tyres (SPT). During an ongoing review of the group's investment in SPT, Ansell said, it decided to write down the current Australian $138-million carrying value when the fiscal 2005 results are finalised in August. Ansell estimates this non-cash write-down at about Au$80 million.

As well as its investment in SPT, which is a 50/50 tyre manufacturing, wholesaling and retailing partnership with US-based Goodyear Tire & Rubber Co., Ansell has lent SPT Au$66 million. This is expected to be repaid in full on Ansell's exit from the SPT partnership, Ansell pointed out.

Previously, Ansell's board had expected that Ansell would ultimately recover the current carrying value of its SPT investment, but it now sees SPT turning in a fiscal 2005 second half performance which significantly lagged behind forecast with a continuing increase in low price imported tyres, and significant increases in raw material costs.”

This, together with a future trading outlook for the SPT business which has now been made available to Ansell, indicates that Ansell's carrying value of its investment in SPT is in excess of the anticipated realisable value,” Ansell commented.

Ansell said it will continue to closely monitor the situation and review the carrying value of its investment in SPT at regular intervals.