Listed meat company Affco Holdings has added to a lamentable year for export meat companies by reporting a $12 million negative turnaround in its end-of-year result.
The Hamilton company has just announced a $1.3 million operating profit before tax in the year to September 30, compared with a$13.7 million profit the previous year.
Trading revenue was down from $954 million to $926 million, but operating revenue was boosted by $23.2 million from other revenue ($4 million in 2006), boosting the company's bottom line.
Operating revenue of $949.5 million for the year under review was down 1 per cent from $959 million the year before.
An analysis of the company's financial accounts also revealed inventories were 50 per cent higher this year than last, $76 million compared with $50.5 million, while net operating cash flows were negative $17.6 million compared with positive $33.5 million a year earlier.
During the year, Affco invested in new dairy processing company Dairy Trust, selling $26 million of land and other assets to the company and subscribing to $15 million in shares.
Chairman Sam Lewis said Affco was a minority shareholder in Dairy Trust, owning 44 per cent of the company.
The meat company has also revalued the 730ha of land it owns, which resulted in a $40 million gain in asset value, not included in the profit.
Higher inventories, investments and property, plant and equipment valuations meant total assets rose sharply, from $282 million to $382 million.
A $27.4 million secured loan helped push up total liabilities from $56.5 million to $121.4 million, but total shareholder equity improved in the year from $225 million to $261 million.
