ALF
01/09/2014 08:41
FLLYR
REL: 0841 HRS Allied Farmers Limited
FLLYR: ALF: Allied Farmers Limited Unaudited Result to 30 June 2014
ALLIED FARMERS LTD UNAUDITED RESULT TO 30 JUNE 2014
The Directors of Allied Farmers Ltd ("Allied") (ALF:NZX) report that Allied
has made an unaudited net profit from continuing operations for the year to
June 2014 of $1.16m (Last year loss $4.42m).
Allied has had a successful year in improving the result of the Livestock
Division and restructuring some of the outstanding liabilities that existed
at the start of the financial year. The result was impacted by a one off gain
of $0.8m on the settlement of an historic obligation (announced in December
2013) and the minimal impact of impairment of investments and loans that have
been significant in prior years.
The Livestock Division, which includes the operation of NZ Farmers Livestock
Ltd, owned 67% by Allied as at 30 June 2014, reported a pre-tax profit of
$1.88m (last year $0.66m) on income that was 19% ahead of the prior year. All
North Island regions showed growth on the previous year with particularly
strong performances in the Taranaki and Waikato regions, and encouraging
numbers from the Manawatu. NZ Farmers Livestock online livestock listing
service, MyLivestock.co.nz, continued to be well supported. Returns from the
meat processing operation were lower than the previous year, and while market
share was maintained, margins were lower than the prior year. During the year
the transfer of the saleyard assets from the parent company to NZ Farmers
Livestock was completed at market value. This was the final stage of the plan
to include all of the livestock operations under the NZ Farmers Livestock
banner.
The Asset Management Services Division ("AMS"), charged with the recovery of
the ex Hanover and United Finance assets, reported a small profit of $0.2m
for the year, (2013 $3.7m Loss). This reflects some small over-recovery on
the disposal of assets less some small write-downs on assets still held.
These assets have now largely been sold, with the value of assets still to be
recovered now under $0.1m. The AMS remains active in pursuing a number of
possible avenues for improving the return from these assets.
Corporate interest costs reduced from $0.8m to $0.3m as secured loans
continued to be repaid. The balance of secured debt owed to the senior lender
was $2.6m at June 2014, down from $5.1m in June 2013.
The listed entity, Allied Farmers Ltd, has shareholders' funds of $3.0m. As
in the last year's accounts, the Group accounts still reflect negative equity
as the consolidated result does not attribute the full market value of the
investment in the NZ Farmers Livestock subsidiary or the saleyard properties
held.
The focus for the coming year will be to continue to grow the Livestock
business and to leverage off the client relationships and trust that exists
with those clients to provide value for money services. The effect of the
reduced dairy pay-out is likely to have some uncertain impact on dairy
livestock sales going forward and the continuing high dollar is already
having some impact on meat exports at the early stage of this season.
After many years of considerable effort re-structuring the Company, the
Directors are encouraged that the benefits of this restructuring are now
starting to show in the financial performance and financial position of the
Company. There is still a lot of work to do and some potentially challenging
situations, but considerable progress has been made during the year.
However, shareholders and the various stakeholders should take comfort that
after a prolonged period of difficult trading and commercial difficulties the
benefits of these efforts are starting to be evident. The Directors wish to
highlight the considerable support and loyalty of all of the management and
staff of Allied Farmers and its subsidiaries, and the support of its many
stakeholders.
ALLIED FARMERS LIMITED
Garry Bluett
Chairman
End CA:00254646 For:ALF Type:FLLYR Time:2014-09-01 08:41:47
