Elders shares jump as CEO says it is no ‘one-trick pony’
Shares in agribusiness group Elders jumped more than 15 per cent as chief executive Mark Allison reinforced the company’s resilience in tougher times despite falling fertiliser prices, and higher interest rates hitting the real estate division.
“Elders is not a one-trick pony,” he said.
Mr Allison said Elders would be on the front foot in pursuing further bolt-on acquisitions and had 16 potential buyouts “in our pipeline”.
Elders CEO Mark Allison says the agribusiness group runs a resilient business.
He said the company would continue to deliver 5 to 10 per cent earnings growth through the agricultural cycle but declined to make a specific forecast for 2023-24, due to uncertainties around the weather and expected drier conditions for summer crops in Queensland and NSW.
“We aim to control what we can control,” Mr Allison said.
The company’s shares gained 15 per cent by midday (AEDT) on Monday to $7.15.
Net profit after tax fell 38 per cent to $100.8 million for the 12 months ended September 30 as falling livestock prices and lower prices for farm chemicals and fertilisers dented profit margins. Revenues were down 4 per cent to $3.32 billion and the company cut its final dividend to 23¢ per share, compared with 28¢ a year ago.
But Mr Allisonsaid it was still the second-highest annual profit for Elders in the past decade.
Elders has made nine small acquisitions in the past 12 months and Mr Allison said more potential buyouts were being scrutinised.
“There is significant room for growth in the business,” he said.
Mr Allison, who a year ago signalled he would be leaving by late 2023 but changed his mind after a global executive search by the board could not find a superior candidate, has been at the helm of Elders for
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