The Invercargill-based group yesterday reported an operating profit before restructuring costs of $10.9 million for the year ended September 30. This compares with a loss of more than $57 million for the previous corresponding period.
Restructuring costs of $2.5 million were well down on the $13.5 million recorded in the previous corresponding period. Profit after tax was $5.6 million, compared with a loss of $50.8 million in the previous corresponding period. The company paid $2.8 million in tax.
Revenue was up slightly from $1.28 billion to $1.36 billion. Operating cash flow was $89 million, compared with a deficit of $163 million.
Chairman Murray Taggart said the return to profitability was a positive result, albeit at an unsatisfactory level, and followed a year with widespread drought conditions and lingering economic weakness in key export markets.
''We experienced a difficult first quarter with slow demand in our markets. However, the company recovered well as the year progressed.''
As the high carry-over of stocks from 2012 moved into consumption, prices started to improve, especially for leg and shoulder products.
During the past 12 months, the company had focused on further developing new and existing markets, Mr Taggart said.
Chief executive Grant Cuff said prospects for the new season were positive, and overseas buyers were looking to secure product.
The company would continue to develop procurement policies that rewarded 100%-committed supply through its platinum and gold supply agreements. In return, those supplies would benefit from the extension of advanced payments and yield quality contracts with premiums above the schedule price, he said.
''These initiatives are consistent with the company's belief farmers choosing to commit their stock to one company is the key to improving long-term returns.''
The recent consolidation of processing through the closure of the Sockburn plant and transfer of sheep-meat processing from Mataura to Lorneville had further reduced overheads, Mr Cuff said.
