No interim dividend for shareholders in East Coast grains handler and shipper, GrainCorp after it revealed a not unexpected loss for the six months to March 31, with the severe drought the culprit.
The company revealed a $59 million loss and not much joy for the rest of the year – a weak outlook being solely dependant on the weather.
A year ago the company paid an interim of 8 cents a share, this year its nothing thanks to the continuing dry conditions across much of Eastern Australia’s grain growing areas.
The shares dipped 4.2% to $7.63 as the profit announcement came two days after the would-be suitor Long Term Asset Partners abandoned their ill-thought-out attempt takeover and departed.
Revenue from continuing operations for the six months to March 31 rose 25.5% to $2.49 billion, but the drought saw net profit fall $95 million, from a $36 million gain a year ago.
“East coast Australian grain production was the lowest in over a decade and this has had a significant unfavourable impact on both our grains and oilseeds businesses,” chief executive Mark Palmquist said in Thursday’s release.
Mr. Palmquist said the company’s malt, feeds and bulk liquid terminals business continued to perform well.
GrainCorp said it expects challenging conditions in eastern Australia to continue into the current second half.
While planting for the winter grain crop is well underway in eastern states, GrainCorp says it is too early in the season to forecast grain production levels.
The company said it will continue to push forward with its portfolio review initiatives, including the demerger of its malt business, the combination of grains and oils, simplification and cost reduction initiatives, and the $350 million sale of its Australian bulk liquid terminals to ANZ Terminals.
