Ann: Change of Director's Interest Notice, page-5

Exactly correct. NOVACQ is a side business.

Their main business is mongastric and aquafeed. The feedmill business is about about local monopolies. Long term contracts are negotiated with customers. For mongastric feed sales are usually pretty predictable year on year as customers have no other choice but to buy animal feed. (It is a bit different for cattle feed where demand is higher when there is insufficient pasture.)

Input prices can rise but can also be hedged against (not sure if this is done). The industry is capital and maintenance intensive so management of these risks is important.

Ridley's Bendigo plant is at full capacity as far as I am aware. The Annual Report I believe stated the Tassie plant is 2/3s and increasing. These are both 'shiny' state of the art plants (at least as far as Australia goes). Older plants have been closed.

Presuming Ridley have done their ROI calcs correctly regarding their capital investment this should bode well for future profitability.


I'm mainly in Ridley because I highly cautious about the global economic outlook. With interest rates the way they are I want to hold equity rather than cash but I want to be in businesses that won't suffer if the Australia and the global economic conditions deteriorate.