Steep dive in earnings at k1 Ventures

k1 Ventures' second quarter net profit dived by 97.5 per cent to $741,000.

Revenue shrank 57.1 per cent to $20.8 million for the three months to Dec 31.

The fall was driven by a decrease in investment income attributable to Knowledge Universe Holdings.

Group operating profit slumped to $3.4 million from $32.2 million in the previous corresponding period, owing to a fall in investment income and an increase in depreciation at Helm due principally to the acquisition of rail assets and locomotive upgrades.

The fall in raw materials and consumables used was attributable to a decrease in revenue from the sale of inventory and locomotive parts at Helm of $2.4 million.

Group EBITDA - or operating profit - of $13.9 million decreased by $26.9 million compared to the prior year due to lower income from investments.

Earnings per share fell to 0.04 cent from 1.36 cents previously. Net asset value per share eased by one cent to 15 cents from six months ago.

Looking ahead, k1 said Helm will continue to focus on opportunities for rail equipment acquisitions primarily in the railcar sector.

The board has determined that the company will not be making any new investments, but will instead focus its efforts on managing the current portfolio of assets and, at the appropriate time, realising these assets.

This will enable the company to maximise value from the proceeds from any realisation of assets and to return the same to shareholders as appropriate.