Loss-making AACo relies on premium beef to offset difficult conditions
25/06/2014
The drought contributed to the company posting a full-year statutory net loss after tax of $39.9 million in the year to March 31, a 20% improvement on the loss of $49.8 million in the year prior.
In response to the dry conditions, the company commenced an accelerated sales programme to reduce the herd to approximately 467,000 head as at 31 March 2014. Domestic and live export prices were depressed, especially in the first half, with cattle sales revenue down by $43.7 million.
“However, the increase in live export permits to Indonesia and increased competition from other markets late last calendar year resulted in increased export volumes in the latter part of the financial year at improved live export prices,” said its chairman, Donald McGauchie.
The company predicts continuing population growth and rising living standards, especially in Asia, will see global food demand grow by up to 70% in the next 30 years.
“While AACo is well positioned to take advantage of this demand, recent improvements in market access are a positive development for both the company and broader Australian beef industry,” Mr McGauchie added, citing the government’s free trade agreements with Japan and South Korea – which imports large quantities of premium Wagyu beef.
“The expected commissioning of the Northern Beef Processing Facility in September will represent an exciting milestone in the evolution of the company. This, coupled with the strength of our branded beef and continued excellence in pastoral operations, means the company is well positioned – and on a sound financial footing following the $299 million capital raising last October – to continue to take advantage of growing global demand for premium beef.”
Share this story:
