AAP Finance

AACo FY loss widens on $47m flood impact

By AAP Newswire

The Australian Agricultural Company's full-year loss has widened by 45 per cent to $148.4 million after a $47 million hit from flooding that killed 43,000 head of cattle.

Australia's largest cattle and beef producer made an underlying profit for the 12 months to March 31 of $37.2 million, even after the $60 million impact of drought conditions, but said on Wednesday that February's North Queensland floods had hit its bottom line.

Meat sales fell by a quarter and AACo's net loss widened from $102.6 million a year ago.

Nonetheless, managing director and chief executive Hugh Killen said the loss of cattle would not affect AACo's ability to fulfil supply obligations or the rollout of its premium branded beef strategy.

"AACo faced weather related events that were unlike anything seen before: 800,000 hectares of our property were affected by floods, while drought conditions on other properties drove up expenses," Mr Killen said.

"While we estimate the loss of around 43,000 head of cattle during this tragic Gulf flood event, I'd like to acknowledge all of my team and our neighbours and friends who are also managing the impacts of this disaster."

AACo managed to lift Wagyu herd numbers - which Mr Killen called "the engine of our business" - by three per cent, while revenue from Wagyu meat sales rose 4.5 per cent.

Mr Killen said AACo was reaching the end of a transition period following last year's decision to mothball its unprofitable Livingstone Beef abattoir in the Northern Territory and drop its budget 1824 brand.

"We have a world class executive team in place and have made some tough decisions, with the outcome being business simplification and a more efficient AACo," he said.

"They have proven to be sound decisions, especially when you consider the drought, and have helped to set the company up for the next decade."

Shares in the company lifted by 1.35 per cent to $1.13 at 1318 AEST, having been as high as $1.14 in earlier trade.

AACO'S FY HIT BY FLOODS

* Net loss $148.4m v $102.6 in pcp

* Sales down 4.1pct to $364.1m

* No dividend, unchanged