Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Rural Equities sells assets to fund dairy conversion

Rural Equities divests carbon credits, halves Tandou stake to fund dairy conversion

By Suze Metherell

Sept. 29 (BusinessDesk) - Rural Equities, the farming group majority-owned by the Cushing family, sold its carbon credits and halved its stake in Australian agricultural company, Tandou, to fund the dairy conversion of its Eiffelton farm and reduce debt.

The Hastings-based company gained $250,000 from the sale of its carbon units at $4.20 apiece, it said in a statement. Reducing its stake in Tandou to 6.35 percent, from 12.66 percent, at 44 Australian cents per share saw the company gain $400,000 on book value, taking proceeds of its divestments to $6.3 million.

Rural Equities acquired the stake in ASX-listed Tandou for an undisclosed sum last year. Tandou's profit fell to A$200,000 in the year ended June 30, from A$6 million a year earlier as it was unable to recognise a fair value gain in its water entitlements in its accounts, it said. Tandou boosted its water entitlements 148 percent to A$78 million in the year.

The farming investor said it intends to keep its remaining stake in the Australian company, viewing it as a long term investment. Rodger Finlay, Rural Equities deputy chairman and Tandou director, was excluded from the company's decision to reduce its holding.

Rural Equities, which owns 25 farms across New Zealand, has begun a $5.1 million conversion of its Ashburton Eiffelton property which will see 233 hectares of its 396 hectare block converted to a 940 cow dairy farm, with the remaining land to be used for winter grazing and supplementary feed. Earlier this month, the company said debt at its balance date sat at 12.1 percent, or $26.6 million, of its $220 million in total assets.

The farm investor doubled annual profit to $24 million in the year ended June 30, as its six dairy farms produced a record 1.67 million kilograms of milk solids and the price of dairy products soared. At the time, the company flagged a falling dairy price may dent profit, but had expected an uplift in beef and sheep meat to offset it somewhat.

Shares of the company, which trade on the unregistered Unlisted market, last traded at $4.52, giving it a market capitalisation of $162 million.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Mycoplasma Bovis: More Properties Positive

One of the latest infected properties is in the Hastings district, the other three are within a farming enterprise in Winton. The suspect property is near Ashburton. More>>

ALSO:

Manawatū Gorge Alternative: More Work Needed To Choose Route

“We are currently working closely and in partnership with local councils and other stakeholders to make the right long-term decision. It’s vital we have strong support on the new route as it will represent a very significant long-term investment and it will need to serve the region and the country for decades to come.” More>>

ALSO:

RBNZ: Super Fund Chief To Be New Reserve Bank Governor

Adrian Orr has been appointed as Reserve Bank Governor effective from 27 March 2018, Finance Minister Grant Robertson says. More>>

ALSO:

ScoopPro: Helping PR Professionals Get More Out Of Scoop

Scoop.co.nz has been a fixture of New Zealand’s news and Public Relations infrastructure for over 18 years. However, without the financial assistance of those using Scoop in a professional context in key sectors such as Public Relations and media, Scoop will not be able to continue this service... More>>

Insurance: 2017 Worst Year On Record For Weather-Related Losses

The Insurance Council of New Zealand (ICNZ) announced today that 2017 has been the most expensive year on record for weather-related losses, with a total insured-losses value of more than $242 million. More>>

ALSO: