GrainCorp's profit down 44 percent
- By: "Farm Tender" News
- Cattle News
- Nov 15, 2018
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Summary:
› Underlying EBITDA1 $269 million (FY17: $390 million)
› Underlying NPAT2 $71 million (FY17: $142 million)
› Statutory NPAT3 $71 million (FY17: $125 million)
› Fully franked final dividend of 8 cents per share (cps); total FY18 dividend payment 16 cps (FY17: 30 cps)
GrainCorp has reported FY18 earnings at the upper end of its increased guidance range due to continued positive performance from the Malt business and strong contributions from Bulk Liquid Terminals and Grains’ international grain trading book. The Group result is however down on last year due to the material reduction in eastern Australian grain production and consequent impact on throughput volumes and exports.
The company has declared a fully franked final dividend of 8 cps, in accordance with its policy of paying out 40-60% of full year underlying NPAT through the business cycle and its target to pay an ordinary dividend each year.
Managing Director and Chief Executive Officer Mark Palmquist said it was pleasing to see the continued solid performance of Malt, supported by improvements in Oils in a challenging environment.
“Our Malt business continues to benefit from strong demand for malt and other brewing ingredients from distilleries and both conventional and craft brewers,” Mr Palmquist said.
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“Malt’s performance included a full second half contribution from our expanded plant in Pocatello, Idaho, and we recently announced a substantial expansion to our malting capacity in Scotland to support growth in distilling demand.
“In Oils, we are embedding improvements through our operational efficiency program in the Foods business and have completed the oilseed crush expansion in Victoria. Tight canola supply continues to put pressure on crush margins.
“The environment for our Grains business during FY18 was extremely challenging and these conditions in eastern Australia have worsened in FY19.
“The integration of our storage, handling and trading businesses is progressing well, and we achieved a higher share of domestic grain trade during the year. Our team is working hard to control costs and to provide ongoing vital services to our domestic customers by reversing our supply chain to bring in grain shipments from Western Australia and South Australia.
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