NEW ZEALAND: Storms, floods hit Richmond's H1 profit
New Zealand meat processor Richmond has reported a sharp fall in first-half profit, which the company attributed to an "extremely challenging start to the season".
The company posted an after tax profit of NZ$0.43m (US$0.26m) for the six months to 31 March, compared to a profit of $14.2m for the same period last year. Total revenue was $589.7m, an 11% drop compared to the previous half year's $663.3m.
Richmond said that in the year-ago period it had been processing at record levels due to climatic conditions. However, in the latest period the rising New Zealand dollar, increased competition and additional capacity in the lower North Island adversely impacted both the volume and margins of Richmond's sheepmeats business.
Furthermore, the East Coast storms in spring resulting in lamb losses of approximately 0.5 million and the severe flooding in February significantly eroded Richmond's profit for the first half of the season. The February flooding resulted in both interruption and damage to Richmond operations in Hastings, Takapau, Oringi, Waitotara and Shannon. Richmond said it carries comprehensive business interruption and material damage insurance and is working closely with its insurers.
Chief executive Richard Carver said the company is back on track to achieving its year-end profit target
"The company has turned the page on a difficult six months. Richmond has delivered strong results in March and April," Carver said.
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