Australia’s greatest pork producer has posted an operating profit of $24.4 million – or $17.7m, excluding JobKeeper – for the 2020/2021 financial year.
- AACo’s operating profit is up $9.2m on last year
- As the herd rebuilds after floods and drought, calving rates are up by 47 per cent
- The value of the company’s property portfolio is also up, from $810m to $915m
The ASX-listed Australian Agricultural Company (AACo) is crediting sage-high cattle costs and an enchancment in the value of the branded pork equipped for the , which also pushed the value of its cattle herd to more than $500m.
For the duration of the release of its full year outcomes neither chief govt and managing director Hugh Killen or chief financial officer Nigel Simonsz commented on the company’s receipt of the federal authorities’s JobKeeper payment, excluding to acknowledge it accounted for $6.7m of the operating profit, which was up $9.2m on the preceeding year.
Regardless of the shareholders, is no longer going to watch a dividend and Mr Killen said operating via the uncertainty of the last financial year was challenging.
“Meals products and companies face ongoing disruption across our key markets across the world,” he said.
Mr Killen said the company also delivered a obvious operating cash float of $18.4m and a statutory earnings earlier than pastime, taxes, depreciation, and amortization profit of $99.3 million, an increase of $19.2m on the old corresponding duration.
Tale costs bolster bottom line
AACo reported an eight per cent enchancment in the value of its average meat designate per kilogram and added that its Westholme and Darling Downs brands now made up for 74 per cent of its branded meat sales.
“Our stable brand portfolio and distribution partnerships have also helped us join with fresh partners and acknowledge to changes in our markets,” Mr Killen said.
The value of pork per kilogram was the great assume, translating to about $1,581 per beast for its total herd of almost 340,000 head.
Mr Killen said gains, especially in North America, had meant a rise of 14 per cent per kilogram in designate and an increase in sales quantity of 19 per cent over the same time.
“The US has been a major center of attention for digital and social campaigns to force brand awareness around Westholme,” he said.
“Now we have persisted to deal with at-home chefs via meal kit product innovations and on-line marketplace partnerships, including with high profile chefs.”
He said the company had also considered a five per cent enchancment in the value of its Darling Downs brand in South Korea over the reporting duration.
Mr Killen said AACo was monitoring the Chinese market, formerly a destination for its trim product, and said alternative markets for that meat would proceed to be explored.
Drought hampers rebuild
AACo’s total herd number was down 1.8 per cent on the year earlier than, with the sage pointing to losses in the 2019 floods on its Queensland gulf country properties and destocking all via drought on various stations.
“One among the penalties of these seasonal impacts is decrease calving rates,” Mr Killen said.
Earnings is down $40m year-on-year because AACo is preserving animals as part of herd rebuild.
But Mr Killen said there had been a 47 per cent increase in calving for this financial year.
He said three years ago the company had a herd of 400,000 head and that the aim was to return to a similar number.
“A number with a four in entrance of us will give us more flexibility than the place we are now,” he said.
“For us it’s no longer the total numbers — it’s also the number of cattle that are on feed, because we have a three-and-a-half year cycle by way of our F1 program.
Win assets high $1b
AACo estimated it had more than $1 billion in accept assets in 2020/2021, with increase especially in land values.
Its property portfolio alone increased to $915m, up from $810m a year ago.
Whereas it was no longer mentioned in the outcomes, Mr Killen said AACo’s mothballed Livingstone meat processing facility in the Northern Territory was costing the company about $1m a year to maintain.
“It’s absolutely a gateway asset and my examine has always been that I want to operate it again and clearly the place we are in the cycle factual now it’s no longer the factual time to be opening it,” he said.
“We are striking plans in place and we’re doing some work over there and moral making obvious that when that tide turns that we’re in a moral place to open it when the must haves are factual for that.”
Mr Killen said AACo remained focussed on sustainability and pointed to its second sustainability benchmarking sage as a result of be released later this year.