Allied Farmers has declared an audited net profit after tax attributable to shareholders in the 2023 financial year to June 30 of $3.338 million, up 16% from the previous year.
The increased profit came from a 40% growth in contribution from NZ Farmers Livestock, of which listed rural investment company Allied Farmers has 67.8% ownership.
The balance is owned by past and present agents and staff members.
That contribution was $2.4m, up from $1.7m in the year before.
The wholly owned NZ Rural Land Management Company (NZRLM) subsidiary contributed $1.14m to the net profit.
Allied Farmers chair Shelly Ruha said the directors will update shareholders on company developments at the annual meeting in November, and whether a dividend from FY23 will be paid.
Since the results announcement in late August there has been an unsolicited offer from WAF Ltd to buy up to 19.99% of the Allied Farmers shares.
A letter has gone to all shareholders from WAF, offering 71.5c a share to purchase up to 1.65 million shares, which would take WAF from 14.25% currently to 19.99%, just under the takeover threshold requirement under NZX rules.
WAF built its shareholding with on- and off-market purchases over the past year at around 75c a share.
Allied Farmers managing director Richard Milsom said the offer by WAF was considered a friendly one, lifting liquidity in the stock and enabling a number of smaller shareholders to exit if they wanted.
WAF was not seeking a seat on the board, he said.
“We are pleased that WAF likes what Allied Farmers is doing and wants to be a committed minority shareholder.”
The offer price is higher than the prior average transaction price of the ALF shares at 68c.
The ALF share price has risen to 72c since news of the offer on August 31 and the stock has traded between 70c and 80c for most of the past 12 months.
Ruha said the NZ Farmers Livestock agency business is again challenged, with difficult weather, some reduction in meat and dairy market prospects, the impact of stock processing space constraints, and plenty of grass through the summer making for an unusual year.
“While slightly behind expectations, the agency business saw encouraging progress on yard market shares, and continued to progress the online auction and other digital developments that are increasingly important tools for our team and clients, and future-proof this core area of our activity.
“The veal business, reflecting good product market returns, again returned an excellent result, appreciably ahead of both expectations and last year.”
Livestock financing is now carried out by referral to Heartland Bank.
Heartland also helped finance the acquisition back in March of the remaining 50% of NZRLM not already owned by Allied, for a total consideration of $8.3m.
NZRLM had reduced income from property transaction fees when compared with FY22.