Ridley Poised to Make Acquisitions

AUSTRALIA - Feed company, Ridley Corporation, has posted a net loss of almost 40 million Australian dollars (AUD) but says it is on the look-out for further acquisitions. Following a new contract with Inghams, Ridley is to re-open its Clifton facility in Queensland and grow poultry volumes in South Australia.
calendar icon 25 August 2009
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Feed manufacturer and salt producer, Ridley Corporation Ltd, says it is uniquely positioned to take advantage of consolidation opportunities in the animal feed sector, despite posting an annual net loss of AUD39.53 million.

Sydney Morning Herald reports that the 2008/09 result was pulled back by a AUD52.4 million loss on the sale in November 2008 of Ridley's 69 per cent stake in Canadian subsidiary Ridley Inc, and other significant items totalling AUD7.4 million.

Profit after tax but before significant items from continuing operations rose 27.6 per cent to AUD20.3 million.

"Whilst 2010 will largely focus on further improvement to our current businesses, we remain vigilant for opportunities that match our core competencies as a processor of value-added agricultural products," Ridley said in a statement.

"We expect to see more consolidation opportunities emerge in the animal feed sector in which Ridley is uniquely positioned to take full advantage."

Ridley shares closed up 4.5 cents, or 4.89 per cent, at 96.5 cents on Tuesday.

The company said that since the end of the 2008/09 financial year, it had entered into a significant new contract with chicken supplier, Inghams, which would result in the re-opening of Ridley's Clifton facility in southeast Queensland and growth in poultry volumes in South Australia.

The company said its Ridley AgriProducts stockfeed business was now far less exposed to seasonal and environmental fluctuations due to its focus on the intensive poultry, pig, dairy and aquafeed sectors.

Ridley said that in 2010, its Cheetham Salt business would complete a refinery refurbishment programme and was expected to return to normal profitability levels.

But the full year benefit of the programme would not be realised until the fiscal 2011 year.

In 2008/09, Ridley AgriProducts generated a 63 per cent lift in earnings before interest and tax (EBIT) to AUD24.4 million as it cut staff numbers by 20 per cent, reduced losses on its supplements business, lowered manufacturing and overhead costs and improved margins.

Cheetham Salt's reported earnings fell 19 per cent to AUD20 million after a AUD3.5 million write-off of crude salt lost as a result of abnormal weather in Queensland, and a AUD1.3 million inventory loss due to insufficient documentation and traceability.

Sydney Morning Herald reports that revenue from continuing operations for the 12 months to June 30 fell 2.2 per cent to AUD819.4 million. The company declared a final dividend of 3.5 cents per share, in line with the dividend in the prior corresponding period. The total dividend for the year was seven cents per share.

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