Murray Goulburn is comfortable with its actions despite the prospect of a possible shareholder class action over a big profit downgrade by Australia's biggest dairy producer.
Law firm Slater and Gordon says it and litigation funder IMF Bentham are weighing legal action after Murray Goulburn this week downgraded its full-year profit guidance for the current financial year to between $39 million and $42 million.
That was down from Murray Goulburn's February forecast of $63 million and well under its prospectus forecast of $86 million ahead of its stock market debut last year.
Slater and Gordon and IMF are investigating whether Murray Goulburn misled investors but Murray Goulburn says it has met its obligations.
IMF and Slater and Gordon are also investigating whether Murray Goulburn failed in its continuous disclosure obligations by not announcing the latest downgrade prior to April 27.
Lastly, they are considering whether unitholders in Murray Goulburn's listed entity, MG Unit Trust, can recover any consequent losses.
In the wake of the downgrade, MG Unit Trust shares plunged more than 40 per cent.
"We are very comfortable with our processes and do not consider that we have any issues with our continuous disclosure," a Murray Goulburn spokesperson said on Friday.
Murray Goulburn blamed the latest downgrade on weak growth in demand for adult milk powder in China, the rising Australian dollar, and a downward revaluation of stocks of milk products expected to be sold in fiscal 2017.
The dairy co-operative said the February downgrade resulted from weak dairy commodity prices.
On April 27, Murray Goulburn announced that managing director Gary Helou and chief financial officer Brad Hingle would be stepping down from their positions.
Slater and Gordon senior class action lawyer Tim Finney said the law firm's initial investigations had identified inconsistencies between Murray Goulburn's statements to the market regarding its forecast profits in fiscal 2016, and the factors that would affect its performance.
Mr Finney said the scale of the April 27 downgrade could not be explained by the reasons so far provided by Murray Goulburn.
"We are investigating whether the true cause of Murray Goulburn's downgrade was an aggressively optimistic profit forecast built into its product disclosure statement that the company was simply never going to achieve," Mr Finney said.
At 1340 AEST on Friday, MG Unit Trust shares were down 3.5 cents, or 2.69 per cent, at $1.265
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