Its operating profit for the quarter was highlighted at $4 million yesterday, but one-off costs dragged that back to a $1.2 million net loss.
South Canterbury announced this week it had recovered $202 million from outstanding distressed loans since January, and also that South Island businessman George Kerr's Torchlight fund had taken up an option to inject $15.5 million into South Canterbury, boosting the stake to a total $37.5 million - which is separate to another Torchlight loan of $75 million made last October.
South Canterbury Finance chief executive Sandy Maier said the March-quarter performance was a "substantial turnaround" from the company's audited $198.6 million after-tax loss for the six months to December 31.
"[This] represents a turning point from the losses recorded by the company over the previous 18 months ... a heartening outcome with many positive aspects for the future of the business," Mr Maier said in a statement to markets yesterday.
The unaudited operating profit for the quarter was $4 million, including a positive net interest margin of $1.4 million, but the operating result was before one-off expenses for investment losses of $3 million, impairment losses of $1.7 million and foreign exchange losses of $500,000 - totalling a net loss of $1.2 million.
Craigs Investment Partners broker Peter McIntyre said although the results were "thin on detail", the result met market expectations and showed an increase to $80 million of cash in the balance sheet.
"The company's cash position is steadily improving. They have been working hard on business to meet the expectations of existing and [would be] new investors, and [international rating agency] Standard & Poors," Mr McIntyre said.
Following South Canterbury's "aggressive writedowns" of debts in its own book-cleansing in recent months, Mr McIntyre said the quarterly result was what the market expected.
He reiterated the markets and investors wanted more information and details on South Canterbury's roll-over rates; its current $1.25 billion prospectus and funding situation to deal with $1.13 billion of bonds and debentures coming up for roll-over or repayment during the next five months.
"The cash position is getting better but it is still not solving the riddle of the roll-over," Mr McIntyre said.
South Canterbury's unaudited total assets at March 31 were $2.08 billion and equity was $203 million, with the latter increasing by $37.5 million from the Torchlight loans and commitment from the parent Southbury Corporation Ltd.
Mr Maier said trading conditions were becoming more favourable, with improvements in the current economic environment prompting "excellent prospective lending opportunities in the business and consumer sectors".
Mr Maier said South Canterbury's core business "is again making a positive contribution that should boost the confidence of all stakeholders".
