Australian poultry processor Inghams Group has lowered its earnings guidance for its 2026 financial year.
In a stock-exchange release on its fiscal first-half results today (20 February), the company said it now expects underlying earnings in its full fiscal year to sit between A$180m and A$200m (US$127m to US$141m).
It had previously forecast its "pre AASB 16" underlying EBITDA to sit between A$215m-$230m.
"A key driver of the guidance revision relates to the timing of the realisation of the operational improvements that are being made," Inghams said in its release.
"The measures that have been implemented are taking longer than initially anticipated to translate into financial results and are now expected to be more heavily weighted towards the final quarter of FY26."
The chicken nuggets and turkey mince maker also cited a "flat" performance in New Zealand.
Shares in Inghams were down 13.52% today at the close of trading in Australia after the business issued a set of results that also included a significant drop in profit and flat group revenue.
In the first half period, the group saw net profit after tax plunge nearly 65% to A$18.1m, while revenue in the period was flat at A$1.61bn.
Earnings in the period were down almost 34% at A$139.2m while underlying EBITDA pre AASB 16 dropped 35% to A$80.6m.
The company blamed the fall in first-half earnings on higher costs from surplus inventory as well as "supply chain transition and customer onboarding costs".
In its results release, Inghams CEO and managing director Ed Alexander said: "Pre AASB 16 earnings of A$80.6m for the first half of FY26 were disappointing, with the results impacted by the cost of managing excess inventory and supply chain transition inefficiencies as the business implemented an operational reset following customer changes experienced in FY25."
Alexander said the guidance change was a drop on previous expectations but “still represents a strong uplift over the first-half result".
"The fundamentals of the business continue to strengthen", he added, noting the business "returned to volume growth in the second quarter" while it also saw prices increase in Australia and New Zealand "supported by improved wholesale market fundamentals".
He also said the company had lowered inventory "which is supporting a return to normalised production settings into the third quarter and improved operating efficiency".
The chief executive added: "With improved inventory levels and momentum returning across the core business, earnings are expected to improve through the second half and into FY27.”
In October, Inghams denied media speculation that it had been exploring a sale of the publicly listed business.
A report in The Australian publication had suggested the group had been “discreetly” offering Inghams up for sale but in a stock exchange announcement the business refuted the claims.
In a stock exchange filing, Inghams said: “The company confirms that it has not been holding such discussions or otherwise pursuing a sale of the business. Inghams will keep shareholders and the market informed in line with its continuous disclosure obligations.”
In its results for the year to 28 June, the business saw net profit to shareholders fall 11.5% to A$89.3m. Revenue dropped 3.4% to A$3.15bn.
EBITDA decreased 15% to A$392.2m and EBIT declined 6.2% to A$209.3m. Earnings per share were down 11.5% at 24.2 cents.
