Ingham's Group lifted first-half profit by more than a quarter after higher poultry volumes offset a fall in sales for the company's animal feed operation.
The poultry producer on Thursday reported a 28 per cent jump in profit, in pro-forma terms, to $65.7 million, in a result driven by a 2.8 per cent improvement poultry volume growth.
Chief executive Mick McMahon said the result - which was also boosted by a $3.1 million one-off tax credit - was supported by improved efficiencies and cost reductions that helped offset the rising cost of feed production and declining sales.
"Feed prices are up in general in a dry summer with higher wheat prices," Mr McMahon said.
In its Australian poultry business, Ingham sold more poultry - predominantly chicken and turkey - through supermarkets, restaurant and food service channels.
Prices were higher as a result of higher electricity, gas and feed prices, the company said.
Ingham's listed on the ASX in November, 2016 and the results for the six months to December 30, 2017 included pro-forma figures to account for costs associated with the listing.
In statutory terms, Ingham's $65.7 million net profit was six times higher than the previous corresponding period, when profit was weighed down by listing costs.
Revenue for the six months was 1.7 per cent lower at $1.206 billion.
Mr McMahon said the first half of the year was seasonally stronger than the second half and the company's New Zealand market remained "challenging".
While acknowleding some feed customers were struggling with higher prices, Ingham said it plans to offset the increasing costs across the business, particularly in feed, by allowing the rising prices to be passed on.
"We're not in the business of passing on price increases unless we have to," Mr McMahon said.
The company also flagged asset sales to help offset ongoing restructuring costs during the current financial year.
Ingham's shares closed flat at $3.55.
POULTRY VOLUME LIFTS INGHAMS H1
* Half year pro-forma profit up 28pct to $65.7m
* Statutory profit increased from $9m in HY17
* Revenue down 1.7pct to $1.2b
* Interim dividend of 9.5 cents, fully franked
