The outlook for NZ Farmers Livestock is bright, reflecting generally high livestock values and therefore agency fees, Allied said in its results announcement.
Allied Farmers has reported an unaudited, consolidated net profit of $1.438 million for the first half of the 2022 financial year, up from $1.18m in the previous corresponding period.
Net profit before tax for NZ Farmers Livestock almost doubled to $1.5m and NZ Rural Land Management added $300,000 for the first time in an interim result.
The cost of operations for the parent company deducted $400,000.
Allied said a strong driver was the meat export business, focusing on calves and veal production.
It benefited from a faster than anticipated recovery of product prices, maintenance of stock tallies, and an earlier than usual sale of the main spring production.
That removed any export logistics risk and reflected the value of the contracted arrangements in place.
The outlook for NZ Farmers Livestock is bright, reflecting generally high livestock values and therefore agency fees, Allied said in its results announcement.
“We expect significant improvements in livestock trading activity for the balance of the year due to these higher prices, the return to more favourable weather patterns nationally, good herd sales activity, and reducing covid impacts,” independent chair Mark Franklin said.
“Dairy herd forward sales are arranged throughout the financial year but not accounted for until contracts settle late in the financial year.
“With dairy farm sales activity and a higher milk payout, these contracted sales levels are appreciably ahead of last year, and we expect to see a significant earnings contribution late in the second half of the financial year.”
Allied will not pay an interim dividend as the board believes retaining and deploying earnings is in the best interests of shareholders.
The net tangible asset backing of the shares at December 31 rose 10c to 42c and the company’s share price rose 33c or 60% to 86c over the past year.
