Australia: ABB Grain announces $36.2m full year profit

Leading Australian agribusiness ABB Grain Ltd announced on November 28 an annual net profit after tax and before goodwill amortisation (NPATA) of A$36.2 million for the year ending 30 September 2005.

• Full year NPATA of A$36.2m – at high end of forecast
• Fully franked dividend of 9.0 cents per share, taking full-year dividend to 17.0c
• Total operating revenue in excess of A$1.1b

ABB’s managing director, Michael Iwaniw, said the full-year result was at the upper end of the previously forecasted profit and reflected the increasing diversification of the company, despite the poor 2004/2005 season that occurred in that financial year.

“The below average harvest we experienced last year meant receivals were down nationally, resulting in reduced profits,” Mr Iwaniw said.

“ABB’s storage and handling receivals, at 4.2 million tonnes for the season, was significantly under the five-year average of 5.9 million tonnes and well below the previous year’s intake (by AusBulk Ltd) of 6.5 million tonnes, which directly impacted on our results.

“Nevertheless, our first year as an enlarged entity, following the merger with AusBulk and United Grower Holdings, was successful with a number of highlights showing the value of diversifying our business and using to our advantage our geographic spread of operations.

“Our marketing expansion into other States on the Australian mainland has resulted in a greater number of ABB representatives nationwide servicing growers and accumulating grain from a wider area than ever before.

“Despite the low overall crop size last year ABB accumulated nationally 5.1 million tonnes of grain in the 2004/05 season. Of this total 78% was unrelated to the barley single desk.

“Further evidence of our business diversification is our Perth malthouse expansion at Forrestfield, which is on track with construction of the first stage expected to be complete in February 2006 and the new facilities expected to reach full production in May 2006.

“Also, initial tenders have been let for Outer Harbor, with some earthworks now underway.

“In addition to this are the synergies and cost efficiencies that have been achieved since the merger, and have resulted in reduced costs and improved revenue.

“This past year has truly reinforced our position as a national company, and looking ahead we will continue to build on opportunities as they arise to provide even greater service to growers, customers and shareholders alike.”

In announcing the results, Mr Iwaniw said ABB would pay a fully franked final dividend of 9.0 cents for each ABB B-class share on 23 February 2006, with a record date of 2 February 2006.

The company previously paid a fully franked interim dividend of 8.0 cents per share on 5 July 2005. The latest dividend announcement brings the total dividends paid for the 2005 financial year to 17.0 cents a share, representing 65.7% of the company’s net profit after tax and before amortisation of goodwill.

Mr Iwaniw said that, in line with usual practice, a profit forecast for the 2005/2006 fiscal year would be released at ABB’s annual general meeting on 24 February 2006.

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