Ruralco released its half year results for the six months to 31 March 2017, delivering a record half year profit.
Directors declared an interim fully franked dividend of 9 cents per share, up 12.5% from the prior corresponding period.
Ruralco Managing Director and Chief Executive Officer, Travis Dillon, said he was pleased with the strong performance of the core business.
“Our core traditional businesses have delivered top line growth driven by favourable seasonal conditions and focused cost management,” he said.
“The investment in high quality, accretive acquisitions, has brought increased scale and diversity to our businesses, both operationally and geographically.
“The Future Farming Strategy is delivering balance to our network, priming the business to perform in the face of seasonal fluctuations.”
Rick Lee, Chairman of Ruralco, said the Board is satisfied with progress during the half:
“Disciplined working capital management has allowed the Group to maintain a strong balance sheet, providing capacity for future growth.
“This is a strong result and the Board is confident in the clear path forward,” said Mr. Lee.
PERFORMANCE
Rural Services: Strong seasonal conditions have led to organic sales growth in rural merchandise, fertiliser and crop protection chemicals. High average livestock prices, an increase in real estate sales volumes at higher average prices, and demand recovery in the wool market have all bolstered the strong performance of this division.
Water Services: Seasonal conditions produced higher than average rainfall in many parts of the country. Despite being a positive driver of the strong performance in Rural Services, the counter cyclical nature of the existing water business and the impact of its geographical concentration in the west and south was evident in the division’s weak first half financial result. The completed acquisitions of 14 new business locations in key catchment areas and agricultural centres are expected to diversify the earnings base geographically.
- Live Export: The successful restructure of the division during 2016, and reduced supply chain costs have driven strong earnings growth in the half despite a 12% decline in volume exported following closure of the southern business. The long-term market outlook continues to support Ruralco’s commitment to the live export sector.
- Financial Services: Uptake by customers of the Group’s off balance sheet seasonal finance product has doubled in the half.
-Ruralco
