Recognising the “significant deterioration” in the company’s business and prospects, KH Foods has revised its forecasts for the next three years.
In a statement to the Australian Stock Exchange, the company said it was now anticipating losses of AUS$19.2m and AUS$6.1m in 2006 and 2007 respectively.
The company said that it needed to restructure its operations. If this can be completed successfully, the board of KH Foods predicts a return to profitability in 2008.
The restructuring efforts will be funded by loans from Washingtin H Soul Pattinson and Co, who has a 53.26% stake in KH Foods.
The company has proposed the appointment of Tony Sherlock to chair an executive committee responsible for the restructuring efforts following the resignation of managing director Don Taig.