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AWB sees first half net profit 45-55pc lower
10:39, Tuesday, 10 February 2009

Sydney - Tuesday - February 10: (RWE Aust Business News) - AWB
(ASX:AWB) has sustained operating conditions that were substantially
weaker during the first four months of the financial year compared with
the corresponding period last year.
Managing director Gordon Davis said AWB expects first half profit
after tax and significant items to be approximately 45-55 per cent lower
than the previous corresponding half year of $22.3 million.
On an underlying earnings basis AWB expects that first half
profit before tax and significant items will be approximately 55-65pc
lower than the previous corresponding half year of $64.6m.
Such forecasts assume a continuation of current slow trading
conditions in the coming two months.
"The full year profit will largely depend on improved seasonal
conditions in the second half of the financial year," Mr Davis said.
Mr Davis said operating conditions have been solid in WA and
Queensland but the ongoing drought has adversely affected trading
conditions in Victoria, South Australia and New South Wales.
"Landmark in particular has been adversely affected by these
trading conditions," he said.
"However, Landmark is well positioned to take advantage of a
return to normal seasonal conditions in the second half of the financial
year, which is traditionally stronger than the first half."
Mr Davis said in the newly deregulated wheat export environment,
AWB Pools have been relatively well supported and as expected, cash
trading is becoming a bigger part of the wheat market with farmers using
more warehousing and on farm storage before making final marketing
decisions.
AWB is expecting pool volumes in the range of 2.5-3m tonnes.
"Due to the drought in south eastern Australia, AWB has received
lower volumes than expected through its Grainflow operations, albeit
higher than the prior corresponding period," he said.
"Harvest finance has also been adversely affected by the lower
pool volumes."