Wellington, Feb 16 NZPA - The share market has come down hard on Fisher & Paykel Appliances -- wiping 41 cents off its shares after the company issued a profit warning today.

The whiteware manufacturer's shares, which were worth $2.94 this time last year and worth $1 on Friday, went into free fall and were worth just 59 cents this afternoon.

Earlier today the company said it expected a net profit of $25 million to $30m, down up to 54 percent on last year.

Due to the deterioration in the New Zealand dollar, Fisher & Paykel Appliances' total bank debt grew $122 from March last year to $512m at the end of January. It was predicted to be $570m by the end of March.

It is now looking at reviewing its capital structure and alternative sources of capital.

The market was very concerned the company had to come back with a capital raising, which was unexpected, said Hamilton, Hindin, Greene director Grant Williamson.

The home appliance market had dropped off in all areas Fisher & Paykel exported to and there did not appear to be too many signs of a turnaround in world housing at the moment, he said. "I think investors are starting to say; how long is it going to be before conditions change for the company? I think that's the biggest concern."

Mr Williamson said Fisher & Paykel Appliances' wares were sold into most new homes but when very few new homes being built it would have a serious effect on their sales.

A 40 percent drop in share value was a big hit for the share price to take but that was the general state of the market.

"If any company disappoints the market then the market is very harsh on their share price and we have certainly seen that this morning with Fisher & Paykel Appliances." The company announced it would not proceed with a capital note issue and was looking an alternative source of capital.

The directors were considering the merits of issuing equity, including to a cornerstone investor.

Mr Williamson said he did not believe a capital notes raising would have been particularly well received.

He did not see any short term bounce in the price until there was clarification around the structure of equity raising. That was expected to be announced in early March.

"At the moment there's still a fair degree of selling in the market place, around the 60c level."

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