LIC
12/02/2015 10:26
HALFYR
PRICE SENSITIVE
REL: 1026 HRS Livestock Improvement Corporation Limited (NS)
HALFYR: LIC: Half year performance better than expected for farmer co-op
12 February 2015
Market statement
Half year performance better than expected for farmer co-op
LIC has recorded a solid performance in the first half of the financial year.
In the six months to 30 November 2014, the co-op achieved revenue of $159
million, 17.7% higher than the same period last year.
Chairman Murray King said the half year result was better than expected, and
driven by farmers choosing to continue to invest in solutions which improve
their productivity and prosperity.
"As their co-operative, we provide farmers with solutions that will add value
on-farm and deliver a return on their investment.
"While we do see a reduced spend in lower payout years, we find that farmers
are willing to continue to invest in the solutions that will deliver a high
return for their business."
King says the co-op experienced particularly high demand for its short
gestation genetics. DNA parentage testing and information and automation
technology systems also remain popular.
A lower year on year net profit after tax result is forecast, as part of the
expected impact of milk payout and the co-op's ongoing investment into
technology and infrastructure worth more than $20 million.
The co-op has reviewed where it can reduce discretionary costs without
impacting service to farmers, King said.
As part of its growth strategy, the co-op has announced a number of new
developments this financial year, including a joint venture in Brazil,
partnerships with Figured and SCR, and the merger of subsidiary business DAL
and Protrack.
Summary, Half Year Result
LIC revenue and other income for the six months to 30 November 2014 was $159
million, 17.7% ahead of the $135.2 million achieved during the same period in
2013. Net profit after tax for the half year was $29.7 million, up $2.7
million from the previous year reflecting the strong first half revenues
across most product categories.
LIC's business, particularly artificial breeding (AB), is highly seasonal.
Half year results incorporate the majority of AB revenues but not a similar
proportion of total costs, and are therefore not indicative of the second
half, nor the full year, result. No dividend is therefore declared at half
year.
LIC continues to operate a strong balance sheet with total assets including
cash, software, land and buildings and bull teams of $322.6 million. Cash
flows from operations continued to strengthen generating $6.6 million,
compared to $1.2 million in the half year to 30 November 2013.
ENDS
Contact:
Media: Ashleigh Sattler, Senior Communications Advisor [email protected] or
027 617 1942
About LIC
Livestock Improvement Corporation, trading as LIC, is a farmer-owned
co-operative that provides a range of services and solutions to improve the
productivity and prosperity of farmers. With origins dating back to 1909, LIC
has a long history of providing world and industry-leading innovations in
dairy genetics, farm information systems, herd testing, DNA technology and
automation. Today the New Zealand-based co-op employs more than 800 permanent
staff in New Zealand, the United Kingdom, Ireland, Australia, and Brazil.
Listed on the New Zealand alternative exchange market (NZAX), LIC has a dual
share structure with co-operative and investment shares. Farmers are
allocated co-operative shares (which have voting rights) when they purchase a
prescribed volume of products and services from LIC. They can also opt to
purchase investment shares which can only be purchased and traded amongst
co-operative shareholders, with a small holding available to LIC staff.
With annual revenue in excess of $200 million, all LIC profit is returned to
its farmer owners/shareholders in products, research and development or
dividends. Visit www.lic.co.nz for more information.
End CA:00260570 For:LIC Type:HALFYR Time:2015-02-12 10:26:21
(20min delay)