Elders announces $123m net profit
Source: Elders Ltd
via Beef Central (AU) - November 16, 2020
Australian agribusiness Elders has this morning announced a statutory profit after tax of $122.9 million and a fully franked final dividend of 13 cents per share in its full year results for the 12 months to September 2020.
An Elders statement said the strong result demonstrates the resilience of its business model in a year marked by drought, bushfire and COVID-19.
The results included underlying earnings before interest and tax (EBIT) of $119.4m, 62 percent up on FY19, and underlying earnings per share (EPS) of 70.7 cents, 35pc above the previous financial year.
Elders’ statement to the ASX said the result was driven by gross margin growth across all state geographies and products, combined with continued cost control and capital allocation discipline.
“The performance of our Rural Products division was a highlight. The acquisition and integration of leading rural supplies wholesaler AIRR added $44.0 million in wholesale gross margin, well in excess of acquisition business case projections.
“Elders also made excellent progress on its backward integration strategy, selling more of its own branded products at higher margins.
‘Within Agency Services, higher livestock prices provided upside and more than offset the soft wool market. Our Real Estate Services division achieved strong growth in both broadacre and residential property turnover.
“Financial Services delivered above acquisition case growth for the Livestock in Transit delivery warranty product.”
Elders’ Chief Executive Officer and Managing Director, Mark Allison, attributed the outcome to the company’s clear and methodical Eight Point Plan strategy, combined with “its nimble response to challenges that arose throughout the year”.
“Our solid business foundations and strict financial discipline, together with a commitment to ensuring the safety and prosperity of clients, communities and staff across Australia allowed us to succeed despite challenging operating conditions in FY20,” Mr Allison said.
“When the COVID-19 pandemic emerged, we proactively established a COVID-19 Response Committee that convened almost daily to monitor the evolving situation and respond swiftly. We focussed on minimising the risk to our employees and the communities we operate in whilst also ensuring we could continue to serve our clients and play our part in keeping the food supply chain operating.”
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