North Island meat processor Affco Holdings today issued a profit downgrade for the first quarter after what it called "disappointing trading" in October and November.
Chairman Sam Lewis said there had been difficulties with the number of livestock processed, particularly in lambs.
This would be made worse by the increased processing capacityalready operating or proposed in the North Island, he said in a statement to the New Zealand Exchange.
The first quarter ends on December 31.
Meanwhile, Affco said shareholders at its annual meeting in Auckland today approved the acquisition of shares by Talley's Fisheries Ltd and Toocooya Nominees Ltd from Dairy Meats NZ Ltd.
Details of the share acquisition were not immediately available.
In July, Talley's boosted its stake in Affco to 37.95 per cent.
But shareholders -- including millionaire farmer Peter Spencer, whose Toocooya Holdings owned a 20.8 per cent stake in Affco -- would not allow the Nelson frozen food company to buy Dairy Meats' 4.6 per cent stake.
Acquiring Dairy Meats stake would have given Talley's 42.63 per cent of the company.
Talley's had provided significant financial support for Affco, including a partial underwrite of Affco's rights issue last year, and providing a guarantee for Affco's $10 million facility with ANZ Bank.
Affco returned a posted total after-tax earnings of $16.575 million for the year to September 30, compared with a loss of $12.25 million for the same period in 2002.
At 1.40pm, shares in Affco were down one cent at 22 cents, having traded between 14.7 cents and 26 cents this year.
