Australia-based rice business SunRice has maintained its forecast for annual profits despite a decline in earnings in the first half of its financial year.

The company said its profit guidance “remains unchanged and is forecast to be around AUD40m (US$28.6m)”.

In the first six months of SunRice’s financial year, a period that ran until the end of October, the company generated net profit after tax of AUD20.8m, down 13.2% on a year earlier.

Group revenue stood at AUD568.3m, a drop of 11.5%.

SunRice said the results were line with its expectations. It pointed to “the global oversupply of rice causing continued and significant price pressure”, as well as “weakening economies and currency devaluations in key markets”. The company also cited the reduced Riverina rice harvest in 2016.

CEO Rob Gordon said: “We disclosed to the market at the AGM in August that this financial year was going to be challenging for SunRice and we were expecting a weaker first half result, primarily as global rice oversupply continued to negatively impact on prices – since October 2015, global medium grain rice prices have almost halved. Additionally, deteriorating economic conditions were experienced in some of SunRice’s key export markets across the Middle East and the Pacific.”

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However, Gordon pointed to signs the SunRice’s strategy was paying off.  “Despite the exceptional circumstances the business faced in HY17, there are persistent signals that our strategy to build a resilient and diversified business is succeeding. The international rice segment performed well, with increased globally traded volumes and a return to profitability for SunFoods. The rice food segment experienced a considerable increase in profitability.”

In October, SunRice acquired the 35% stake in US rice business SunFoods it did not already own for an undisclosed sum. SunFoods, based in California, is the owner of the Hinode brand (pronounced Hee-no-day), which is sold across 8,000 retail outlets in the US.

The same month, SunRice struck a deal to buy Australia-based pickled onions and gherkins supplier Fehlbergs Fine Foods. The deal, agreed for an undisclosed sum, was made through SunRice’s Riviana arm, which already supplies a range of pickled vegetables. The acquisition added pickled onions to the Riviana stable.