Allied Farmers sees steady FY operating earnings despite headwinds
By Rebecca Howard
June 11 (BusinessDesk) - Allied Farmers expects annual operating earnings to be generally consistent with the prior year despite headwinds from the likes of the Mycoplasma bovis outbreak.
The company says the livestock business remains challenging, with farmer caution related to Mycoplasma bovis, climatic challenges in the earlier part of the second half, and some late softening of cattle pricing.
"To project a repeat of such strong operating earnings, in a far more difficult year, is very pleasing and a credit to the management and staff," chair Mark Benseman said.
When announcing its half-year result in February, Allied Farmers said the uncertainty caused by Mycoplasma bovis, and the resulting programme to eradicate it from the national herd, led to some disruption in livestock trading, particularly in the early stages of the season.
However, it now has full visibility of the impact on the highly-influential herd sales during May.
Allied Farmers reported pre-tax profit of $2.4 million in the year to June 2018, with the livestock unit posting a 2.6 percent decline in earnings to $2.6 million. The company has been focusing on its livestock division, having largely wound down the residual assets from the acquisition of the Hanover and United Finance loan books in 2009.
Today it warned the bottom line this year will be lower given a one-off gain in 2018 which will not be repeated.
Allied Farmers' 2018 net profit was largely flat at $1.5 million, boosted by its $441,000 share of proceeds from a lawsuit taken by the liquidator of Dave Henderson’s Property Ventures Ltd.
The stock last traded at 7.6 cents and is down 2.6 percent over the past 12 months.