Elders says earnings are down
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Troubled agribusiness and automotive interiors supplier Elders has blamed a weak market for lower sales and earnings in the first two months of its fiscal year.
The debt-laden company also said the sale process for two of its businesses - Elders Rural Services and Futuris Automotive - was having an effect on the company.
"Market conditions during the first two months to November had featured dry conditions, subdued activity and lower prices in livestock markets and production schedule cutbacks in the automotive sector," chairman John Ballard said at the company's annual general meeting in Adelaide on Thursday.
"Trading results have reflected this climate.
"Total group sales and earnings for the year to date are behind that of the previous corresponding period, although it is still too early in the year's trading cycle to make reliable conclusions about any implications of this for full year outlook."
Mr Ballard said it had not been possible to insulate the businesses currently being sold from the impact of the sales process, but both businesses had capable, disciplined and highly focussed management teams.
"Both teams appreciate the opportunity that lies ahead in an alternative ownership structure with greater access to capital and are keen to demonstrate their capability," he said.
Elders reported a $60.6 million loss for the year to the end of September, and had net debt at November 30 of $359.8 million, compared with $381.4 million twelve months earlier.
A shareholder vote is still required for the Rural Services sale, but a sale would deliver the best outcomes for shareholders, Mr Ballard said.
Elders has also received non-binding indicative proposals for Futuris, he said, and aims for a sale agreement in early 2013.
Elders shares are currently trading at 11.5 cents, having traded at $23.20 in early 2008 before the global financial crisis hit, causing massive losses on its forestry assets.