Allied Farmers forecasts lower second-half result

June 12, 2006

Allied Farmers forecasts lower second-half result

Allied Farmers Limited advises that its forecast results for the six months ending 30 June, 2006, will not match the results achieved in the previous year, and are likely to be $0.15million behind the corresponding period last financial year.

A consequence of this is that the Company will not now meet its previous forecast to the market of profitability for the full year to 30 June 2006.

Chairman John Loughlin says the Company anticipates a profit before tax of $2.15 million, compared to $3.47 million to June 30, 2005.

“This forecast reflects a reduced contribution from the Real Estate Division following a necessary but unscheduled restructuring and also a significantly less buoyant real estate market.

“It also reflects a further loss for Allied Pine. While the turnaround in Allied Pine is occurring, it is later than expected, although it is being further aided by a lower NZ dollar.

“Other factors reflected in the reduced result are increased provisioning for doubtful debts in the merchandise and pine businesses.”

Mr Loughlin says the Livestock, Wool and Finance divisions have each performed very well.

Prime Takeover

Allied Farmers also advised that its takeover offer for Prime Finance Limited has now been accepted by 98.74% of Prime shareholders, and is now unconditional with compulsory acquisition steps being taken to acquire the remaining 1.26% of shares.

John Loughlin says the acquisition of Prime Finance Limited is expected to add $1.2 million before tax profit to the Allied Farmers Limited result for a full year.

ENDS

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