Elders continues business turnaround
Elders has today announced further progress in its business turnaround, and a renewed commitment to its rural stakeholders.
Elders delivered a $26.1 million profit improvement for its first financial half, recording a statutory net profit of $15.9 million for the six months to 31 March 2015.
Elders’ Chief Executive Officer Mark Allison said that the Company’s continued progress, and positive results represent a considered and measured approach to operating as a profitable agribusiness.
”Our focus has been on delivering value to our rural stakeholders and to ensure we are operating and exploring growth in a sustainable manner,” Mr Allison said.
“Whilst we saw benefit from an uplift in livestock prices in the first half, our focus remains on what we can control as a business,” he said.
Elders’ increased and more efficient utilisation of its Killara feedlot, as well as the restructure of its business in China to focus on meat sales, contributed to a $1.6 million margin improvement for its Feed and Processing business.
The diversification of its Live Export business across new markets and customers has increased flexibility and profitability, most notably a $1.6 million margin improvement.
“In just 12 months we have achieved a 62% improvement in EBIT and improvement in our return on capital from 13% to 17%,” Mr Allison said.
“Although we still have some way to go to reach our FY17 Eight Point Plan target, through the cycle of $60 million EBIT and 20% return on capital, we are confident with the foundations we have in place.
“We are making particular progress in reviewing and rebuilding our key relationships with clients, suppliers, investors, and the local communities in which we operate,” he said.
“In the past six months we have conducted Australia-wide focus group research, engaged in ongoing investor briefings, rationalised key suppliers, and will soon launch a national TV campaign, re-launching the Elders brand.
“Positive operating conditions for the remainder of the financial year are anticipated, with encouraging market and seasonal conditions.
“Cattle and sheep prices are expected to remain strong, and demand for feedlot and live export continues to grow.