Tax ruling could hit Orica profit by $36m

An adverse court ruling on a tax matter is set to wipe about $36 million from the profits of explosives and specialty chemicals supplier Orica.

Orica and the Australian tax office have been disputing amended tax assessments issued to Orica for 2004, 2005 and 2006.

The assessments concern refinancing transactions entered into by Orica subsidiaries between 2002 and 2004.

"The Federal Court yesterday found in favour of the Commissioner (of Taxation). This decision will have an adverse impact on net profit after tax of approximately $36 million," Orica said on Tuesday.

Orica is reviewing the court judgment and is seeking advice regarding an appeal to the full Federal Court.

Orica booked a loss of $1.27 billion in fiscal 2015.

Shares in Orica were 39 cents lower at $15.20 at 1102 AEDT.