Ruralco warns of FY net profit slump

2 Nov 2012, 3:49 pm   -   Source: AAP

Ruralco says lower revenues from its wool and livestock business will drag its net profit down by between five and 10pct for 2011/12.

Agribusiness Ruralco has warned its full year net profit is likely to slump by up to 10 per cent due to lower revenue from its wool and livestock businesses.

"Weaker sheep and wool prices, coupled with a reduction in wool volumes have impacted the profitability and contribution of our agency businesses," managing director John Maher said in a statement on Friday.

"The financial performance of our Tasmanian residential real estate business has also been severely affected by that state's deteriorating economy."

Ruralco expects its net profit for the year to September 30 will be between five and 10 per cent below the $15 million profit recorded for 2011/12.

Its underlying net profit, before non-recurring items, is forecast to be 10 to 15 per cent below last year's $17.6 million profit.

Mr Maher said the company's earnings before interest and tax were also expected to be up to five per cent weaker.

Ruralco is due to report its latest earnings results on November 20.

The profit warning comes just weeks after Ruralco made overtures to Elders to discuss a possible merger between the two agribusinesses.

Elders has since said it wants to sell its rural services business, its biggest division, before someone tries to take it over.

Ruralco shares were steady at $3.25 at 1536 AEDT.

  • Follow us: 
  • Follow us on Facebook
  • Follow us on Twitter
  • Follow us on Youtube