The demand for carpet is expected to increase as a result of the floods, while two-thirds of Bremworth’s supply of wool yarn may be out of commission for months.
The carpet company’s chief executive Greg Smith told Markets with Madison the cyclone ripped through the company’s Napier plant, ruining specialist machinery and totaling an insurance claim likely in the tens of millions of dollars.
Bremworth announced a $778,000 net loss for the six months that ended in December this week, but its top priority was sourcing an alternative wool supply from abroad to ensure it could benefit from an anticipated increase in carpet demand, he said.
According to Smith, flooding affected between 10,000 and 20,000 homes, which would lead to an increase in demand over the following three months to a year.
“That could be as much as 300,000 meters of carpet that are required.”
He clarified whether the disruption and demand might cause carpet prices to rise.
The NZX50 index struggled in February, falling 1.77 percent for the month as the New Zealand company reporting season came to an end.
The S&P500 index fell by 5.46%, and the Nasdaq Composite reversed 6.73%, setting off a trend that spread throughout Wall Street.
The FTSE100 index of Europe and the Shanghai Composite index of China both experienced gains in February, rising 1.21 percent and 0.90 percent, respectively.
Mark Hampton, an investment advisor with Hamilton Hindin Greene, noted that despite many markets having a bad month, returns for the year as a whole have remained positive, which is a good sign for the months to come.
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