Namoi Cotton's $15.8 million profit
- By: "Farm Tender" News
- Cattle News
- Apr 25, 2018
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Namoi Cotton recorded a net profit after tax of $15.8m for the half year ended 31 August 2017, compared with a net profit after tax of $7.4m in the previous half year. A 38% increase in the 2017 Australian crop size was underpinned by improved irrigation water availability in most valleys. Namoi Cotton’s ginning and cotton seed volumes along with Namoi Cotton Alliance’s (NCA) lint procurement volumes all benefited from the increased crop size, improving from the prior half year.
Cotton seed trading margins improved considerably through effective risk and position management, market volatility trading opportunities and seed yield management. Ginning margins were pressured through increased unit variable costs associated with reduced productivity from poorer quality cotton.
The contribution from Namoi Cotton’s investment in NCA improved from the prior half year and was underpinned by a more stable environment for Australian basis (Australian cotton quality premium) and effective position risk management. These factors all combined to deliver a $6.4m improvement from the prior half year in net cash flows
from operating activities. Our forecast full-year net cash flows from operating activities is expected to be within our previous market guidance range of between $17m and $22m.
The directors have elected not to declare an interim dividend (2016: nil cents).
No Grower Member rebate has been recorded within the half-year financial results for the period up to and including the date of the restructure consistent with the prior period
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