Elders Rural Services records improved earnings in 2012 results
Elders Rural Services has recorded improved underlying earnings despite unfavourably dry conditions in the last half of the year, particularly across western and southern Australia.
The results for the year ended 30 September 2012 were released to the Australian Stock Exchange today by parent company Elders Limited, who also owns Futuris Automotive and Elders Forestry.
Elders Limited Chief Executive Officer Malcolm Jackman said the rural services division lifted its underlying EBIT to $29.5million, an increase of 18% on the previous year.
“The Australian network business was impacted by seasonal conditions late in the year which lead to lower farm supplies demand and weaker wool and sheep prices, but this was more than offset by the strong performance of Elders’ trading operations, particularly live exports and favourable mark-to-market adjustments,” Mr Jackman said.
“Despite significantly below average rainfall in western and southern Austraila the Australian network still generated sales of $1,275.3 million which is consistent with the previous year’s sales of $1,276.5 million,” he said.
“Agency operations in livestock, wool and real estate were hardest hit by the sector-wide pressures with sales revenue down 11%, 9% and 6% respectively but farm supplies sales revenue was up 2%.”
Other noteworthy figures in the Elders Rural Services underlying EBIT result include:
- A 25% increase in live export volumes;
- a favourable mark-to-market adjustment of $5.6 million;
- items excluded from underlying EBIT totalling $(10.9) million and relating to discontinued operations and the head office restructure announced in July; and
- a 25% increase in equity earnings from Elders’ joint ventures.
Mr Jackman says that the Elders Rural Services result comes as the business is undergoing an international sales process.
“It’s still early days but we are already receiving significant global interest, as we would expect for a company with an iconic brand and longstanding client relationships, backed up by high quality and dedicated staff,” he said.
“Elders Rural Services has had many owners over its nearly 175 year history and this sales process will enable the business to be recapitalised and continue to grow.”
Parent company Elders Limited reported a statutory loss of $(60.6) million, which compares with the statutory loss of $(395.4) million in the previous year. The 2012 statutory result, like the previous year, incorporates an underlying profit of $13.2 million which was more than offset by significant items excluded from the underlying profit, chiefly arising from the Company’s exit from the forestry sector. Further information about the Elders Limited result can be found at: http://www.elderslimited.com/news/asx-announcements